While college students and their families may get a sinking feeling with every report of rising college costs, research is under way that aims at least to show students and families what colleges do with all that money.
The National Association of College and University Business Officers is doing a school survey to devise a formula for calculating the cost of educating undergraduates, from faculty salaries to heating classrooms.
The preliminary result, presented earlier this week at NACUBO's annual meeting in New York, suggests that most any school, from low-cost community college to the big-ticket private elite, tends to spend more educating undergraduates than tuition covers.
This is no surprise to college financial officers.
"The economics of education are backwards," Gregory Fusco, a former university administrator directing the college-cost project, said Tuesday in an interview.
Colleges generally spend more on their product (graduates) than they charge the customer (students and families), Fusco said. That's because education is subsidized by other sources, including federal aid, donations, invested endowments and, in the case of public colleges and universities, local and state government support.
The amount of borrowing for college can "get a little scary," Fusco said. "If people knew the 50 cents they're paying for a dollar's worth ... they would understand what they're getting a little better."
Just last week, new government research on college costs found 55 percent of the nation's undergraduates paid for the 1999-00 school year with loans and grants, up from 50 percent just five years earlier.
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