The Board of Trustees raised tuition, room, and board by 3.9 percent and increased the pool of undergraduate financial aid by 7 percent as part of a $1.24 billion operating budget for 2008–09, approved Jan. 26. Investment income, primarily from the University endowment, will fund about 45 percent of the budget.
The costs for an undergraduate will be $45,695: $34,290 for tuition, $6,205 for room, and $5,200 for board. The University said the total figure compares favorably with the tuition and fees of peer institutions. In January, Yale announced a 2.2 percent increase in tuition, room, and board — set to mirror the projected rate of inflation — raising its total bill to $45,990.
Provost Christopher Eisgruber ’83, chairman of the Priorities Committee, a group of faculty, staff, students, and administrators that submits the budget proposal to President Tilghman, said that Princeton’s tuition increase is “likely to be less than or equal to the average rate of increase in the incomes of tuition-paying families.” The 2008–09 undergraduate financial aid pool will be $86.7 million, more than half of the total amount that the University expects to collect in undergraduate tuition.
Universities with large endowments have been scrutinized in recent months by members of the Senate Finance Committee, including Sen. Max Baucus, D-Mont., the chairman, who has questioned whether universities should be compelled to spend 5 percent of their assets each year, as charitable foundations are required to do. In an October 2007 letter to the Finance Committee, University Vice President and Secretary Robert K. Durkee ’69 wrote that Princeton’s payout rate for 2007–08 was “roughly 4.6 percent” of the endowment. The University budgeted $535 million of its investment income to fund operating expenses in the current academic year and plans to spend more than $568 million in 2008–09.
About $1.6 million of the 2008–09 budget will fund new initiatives, including larger stipends for graduate students in the humanities and social sciences, salary increases for faculty and staff, and additional staff positions in several areas, such as health services, information technology, and the Frist Campus Center. In response to University Student Government requests, the laundry facilities at campus dormitories will receive new machines and a Web-based monitoring system that will allow students to check on their wash loads from their desks. The University also plans to increase its support of intramural and club sports.
Eisgruber, in his annual letter to President Tilghman, wrote that the University is in “excellent financial health,” thanks to strong endowment returns and record-breaking Annual Giving. There was one cloud in the budget picture: Growth in federal research funding again failed to keep pace with inflation, growing by just 0.6 percent last year.