In light of Grinnell’s decision to retain its established tuition for the 2020-21 academic year, some have asked how Grinnell is utilizing its resources to provide relief to students and families.
Robust Learning
We have all but lost track of how much Grinnell has invested to re-create a robust learning environment for our students, regardless of whether they will be enrolled in online or in-person classes this year. Students will still have regular access to top-of-their field faculty with terminal degrees and international recognition. Our faculty, staff and administration continue to invest enormous sums of energy, time and college resources into preparing for the next academic year. New online pedagogies are under development, we are converting classes to the new 7.5-week term schedule, and investments in new technology are expected to exceed $2.5 million.
Additional Grants
Some of our peers have rolled back their tuition increases this year. Grinnell awarded every student the COVID-19 Response Grant worth $2,500 for the 2020-21 academic year. The value of our grant exceeds this year’s tuition increase and represents a $4 million investment in additional grant aid.
Because several of our students will be unable to earn their work-study award through jobs on campus this year, we have invested over $1 million to cover 50% of all work-study awards with a grant and the other 50% with an optional loan. Students may also benefit from working on campus or remotely in a number of available positions this year.
We realize that some families have experienced negative financial consequences as a result of the pandemic. We have set aside over $2 million in additional financial aid to assist with new financial demands for students and their families. If your family has encountered new financial challenges, please contact the Financial Aid Office for assistance.
Compared to Peers
We are aware that some of our peers that have made the decision to move many of their classes online have announced a rollback of their tuition increases. As a percentage of our operating budget, Grinnell already awards more in tuition discounts than any other need-blind institution that meets the full need of every enrolled student. In some cases, our peers have reduced tuition and capped the number of credits their students will be eligible to earn this year. Grinnell has expanded the total number of credits a student may take this year at no additional tuition cost.
The Value of In-Person Learning
We agree that the on-campus experience has tremendous inherent value, much of which is reflected in the cost of room, board and fees. That is why we are attempting to give every student an on-campus experience this year. When a student does not live on campus, however, they are absolved of charges for room, board and fees. Herein lies additional savings for those who do not qualify for financial aid.
Health and Safety Costs
Grinnell will be covering the costs of testing, personal protective equipment (PPE), and other public health measures to allow students, faculty and staff to utilize our campus in a way that seeks to protect their personal health and well-being. This investment will reach several million dollars by the end of the academic year; all covered from Grinnell resources.
New Hiring
To serve the needs of our students throughout this unusual year, we are in the process of hiring additional essential employees. These expenses will be paid entirely through Grinnell resources.
Savings
There are simply no savings to pass along to students and their families. In spite of several millions of dollars in revenue losses this year due to our low-density, community health approach to reopening, we have decided not to furlough any part-time or full-time faculty and staff this year. Instead of a workforce reduction, our team is working tirelessly to offer a full complement of academic and support services to students across the globe. Our resources will be utilized to pay the wages and benefits of the people who make Grinnell, Grinnell. Now and when the pandemic ends, we will offer every student as vibrant and innovative a learning community as our means will allow. And our people—those who ensure that Grinnell is just as strong after the pandemic, will be here to serve students when we can all be back on campus again.
Adding it Up
We estimate that Grinnell spent over $7 million in unanticipated expenses this year before the next academic year begins. Total costs to keep our students and community safe will exceed $35 million of unscheduled expense and revenue loss. Yes, Grinnell’s endowment is a significant resource, but it is not bottomless and it is already used every year to provide grants to students and to fund over 50% of our annual operating costs. Endowment returns can replace what we do not charge in tuition because it is sizeable. It is how Grinnell remains accessible to students across the socio-economic spectrum. Erosion of the endowment is an erosion of the tuition trust fund for the students who depend upon Grinnell to support their educational experiences.
New Gifts for Grinnell Students
To ensure that Grinnell students are prepared for the coming academic year, we recently established a goal of raising $300,000 to support remote learning challenges, help us narrow the technology access equity gap that the pandemic is amplifying, and continue to make a Grinnell education accessible for all students. To help us reach this goal, an anonymous parent, who learned of this need for our students, offered a $2 for $1 match (up to a maximum of $100,000) to inspire additional gifts. Gifts made to the Support Our Students (SOS) Fund during the match period (Aug. 10-24) will be used to provide laptops and cellular hot spots to students in need.
Grinnell’s Funding Model
For greater context about tuition and cost, we provide this breakdown of our funding model. The total per student cost to operate Grinnell annually ($83,000) actually exceeds the established comprehensive fee for tuition, fees, room and board ($70,544). This means that even a student who receives no financial aid from Grinnell is paying $12,000 less per year than it costs to provide a Grinnell education. This gift to our students is only possible because of our endowment and generous contributions made to the College by alumni and friends for student support.
Grinnell College has three primary sources of revenue: 1) the annual endowment spending distribution, 2) revenue from students, and 3) philanthropic support, plus other auxiliary operations (e.g. bookstore, conference services, golf course, etc.).
Endowment Funding
About 54% of Grinnell’s annual operating revenue comes from the endowment. Our endowment has grown over time because of philanthropic support and strong investment performance over many years. The role of the endowment is to provide intergenerational equity and future financial stability. Over-spending from the endowment in any one year will have a lasting negative impact on the future operations of the college.
Student Revenue
Net student revenue (what is received after financial aid is awarded – cf. Compared to Peers above) accounts for less than one-half of the annual operating budget (about 40%). This leaves the College dependent upon endowment spending distribution and annual contributions from alumni and other donors. The College relies upon philanthropy to fill the gap between the amount Grinnell students and their families pay plus the amount covered by draw from the endowment.
Philanthropic Support
Annual giving reflects the generosity of donors (including many faculty and staff) who invest in Grinnell each year to ensure that Grinnell students receive an excellent education at a price substantially less than the cost Grinnell incurs to provide the education. Every year, thousands of alumni support current students in the way they were supported by alumni and friends when they were enrolled at Grinnell. Gifts to Grinnell College are an essential component of our funding model and create a margin of excellence that the College is proud to offer to our students.