Colleges and universities are finding creative ways to increase revenue at a time when students are more sensitive to increases in tuition and fees, Jon Marcus writes for the Hechinger Report.
According to data from the Department of Education, 71 colleges and universities closed between 2010 and 2014, and 149 closed in the decade before that, Marcus reports. Over 500 more are currently being watched closely by regulators because of financial issues. Enrollments have been decreasing for the last five years, and tuition hikes no longer work because increasing amounts of tuition revenue is returning to students in the form of financial aid.
"Probably the most important issue that all institutions face, large and small, is that they no longer can pass on their rising costs to the consumer," says Rick Beyer, managing principal of AGB Institutional Strategies. Revenue increases for nearly half of private college tracked by Moody's have not kept up with the rate of inflation.
As a result, institutions have no choice but to look for other forms of revenue.
Unity College uses its farm to charge rent for local partners to use the greenhouse. It also offers horticultural workshops. "You can't function as a school, state or private, thinking there's an endless supply of money," says Melik Peter Khoury, president of the college.
Universities have also learned from the spike in coding boot camps and academies that have begun. They are starting their own and using it as an additional revenue source. For example, both Rutgers University and Northeastern University have launched coding boot camps.
Other programs are a little more niche. Beacon College has started a program to teach English to learning-disabled students from Saudi Arabia. The college has also entered a deal with the United Arab Emirates to train teachers there.
And 48 colleges have licensing partnerships for logos on caskets and urns, Marcus reports.
Marcus shares more alternative revenue ideas from colleges, including selling individual seats in courses (comparable to buying a song instead of an entire album), renting out athletic facilities to local clubs and teams, renting out the performing arts center, starting summer camps, catering to weddings and funerals, and licensing deals on items such as t-shirts (Marcus, Hechinger Report, 5/1).
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