At a town-hall meeting on Monday in the ICC auditorium, University President John DeGioia discussed how Georgetown is coping with the recession: moderate tuition increases, increased commitment to financial aid, and delayed staff and faculty salary increases and construction projects.
The 2.9 percent tuition hike, which DeGioia said is the smallest percentage increase in a generation, is intended to strike a balance between the growth required to maintain the University’s standards and the restraint necessitated by the financial climate. According to DeGioia, the University is committed to meeting full financial aid and will increase the budget for aid by 18 percent, up to $88 million.
“It’s very challenging to sustain this policy,” he said. “We anticipate greater need and have built the budget accordingly.”
Next year’s targeted faculty and staff increase will be delayed by six months, and wage increases will be lower than they have been in recent years. However, this will not affect the University’s Just Employment Policy, which guarantees that employees will be paid a living wage.
Although the new McDonough School of Business building, which is scheduled to open this spring, will be completed on time, work on the new science building has been delayed. Administrators expect the new facility to have an annual operating cost of 10 million dollars, on top of its construction costs.
“It will require a better set of financial conditions than are present at his time,” DeGioia said. “As soon as conditions are improved, we will move forward with this building.”
Tony Pals, a spokesperson for the National Association of Independent Colleges and Universities, said that Georgetown’s moves are typical of how universities have been reacting to the crisis.
“What’s clear is that private colleges and universities are responding quickly and forcefully to the recession,” he said. “They are taking clear and decisive steps to shore up their budgets and to transfer cost savings to areas that benefit students.”
In particular, most universities across the country are focused on sustaining financial aid. According to Pals, 92 percent of private colleges and universities plan to increase their financial aid packages next year, and 82 percent are increasing their tuition at lower rates than in the past three years.
But the recession, which Pals described as “the perfect storm,” will not be easy on universities, with endowments down, credit tight, and fundraising slow-going. If the crisis continues another year or two, many universities will be forced to make cuts to student aid and faculty pay—something that Georgetown has so far avoided.
DeGioia acknowledged that the worst may be yet to come.
“The severity of what we are experiencing continues to worsen,” DeGioia said. “Everything I have said tonight assumes that things could get worse.”
—Additional reporting by Juliana Brint