The answer to this question depends largely on how one presents the budget. In any presentation, however, two generalizations can be made about our revenues and expenditures. Our largest revenue sources are the endowment contribution and "net" tuition and fees. Our largest expenditure is the cost of "Instruction." Looked at in a very different way, our largest expenditures are for all salaries/ benefits and also for the maintenance of our campus (our physical plant).

At Grinnell, we present our budget in a manner that is consistent with other educational institutions. This also helps to ensure that our budget is accurately and fairly presented. In reporting our budget, we do not show directly Grinnell College-awarded scholarships and grants, which is obviously a very large "expense" item in our budget. This is because, consistent with the methodology used by our peers, we "net" out financial aid grants from our tuition and mandatory fee income. That is, we show the tuition and mandatory fees as "paid" and then deduct from that figure the amount of any Grinnell College-awarded scholarships and grants. Thus, as set out in the pie chart below, tuition and fees and Grinnell College-awarded scholarships and grants are reported as one figure in our budget: "net tuition and fees." This is done because, for accounting purposes, an item of tuition or any other fee that is reduced by a scholarship or grant award is not "paid," as an accounting matter, and probably should not be sho wn as a revenue item. At the same time, scholarships and grants are a significant allocation of the College's resources.

Conversely, when we present our budget, we show almost all other income items on a "gross" basis. For instance, we show our auxiliary enterprises income, which includes items such as room, board, and bookstore payments as revenue. Were we to "net" our Auxiliary Enterprises revenue with the direct costs associated with running these enterprises, we would only show a modest amount of net auxiliary income. Here is what our revenues look like as we report them.

Net Tuition & Fees [$20.65M]=Gross Tuition & Fees [$41.55M] minus Grinnell College Scholarships & Grants awarded [$20.9M]
Tuition Discount Rate [50.3%] = Grinnell College-Awarded Scholarships & Grants [$20.9M] divided by Gross Tuition & Fees [$41.55M]
The whole pie = Gross Tuition & Fees [$41.55M]
Based on the FY 2006 Budget approved by the Board of Trustees on February 18, 2005

Thus, to specifically answer the question on the expenditure-side, we could do so in two ways.

1) Under our reporting methodology, on the expenditure side, we talk in terms of several functional categories such as "Instruction," Student Services," "Institutional Support," and "Auxiliary Enterprises." (You can see which budgets fall under each of these classifications at: http://www.grinnell.edu/offices/institutionalplanning/budgetcategories/.) Here is what next year's expenditures, including our largest ones, look like by functional classification:

2) We could also think about our expenditures in an entirely different way, within what is called a "natural" classification. Using this classification, for example, we could organize our expenditures by such categories as "salaries/benefits" and "maintaining our campus" (our physical plant), which are our two largest expenditures, rather than by the function classifications listed above. Here is what next year's expenditures look like by one natural classification:

Maintaining generous financial aid support and competitive salaries as well as operating our new facilities largely drive our increased spending. For example, while we project that gross tuition will increase by $3.7 million, we also project that financial aid support will grow by $2.72 million, thus leaving slightly under $1 million in additional revenue from tuition. This additional tuition revenue is also a result of a growth in the budgeted number of students on-campus, discussed in
Question #7 below.