The Budget Committee held its second open forum on Jan. 19 for the Guilford community to ask questions about the proposed 2006-2007 budget. The purpose of the meeting was to update the community on the latest formulations of the budget, give specifics on tuition increases, salary increases, financial aid and Strategic Long Range Plan (SLRP) implementation.

Kent Chabotar, President of Guilford College, established several goals for the budget committee. The primary goal is to have an equitable budget every year. Other goals include decreasing the endowment spending, increasing tuition, increasing major maintenance and other capital projects, and increasing pay for faculty and staff. The objective of the committee was to bring order to Guilford’s finances.

The original projection for the 2006-2007 budget estimated a deficit of $706,000. This is referred to as the gap. A revised and more accurate projection revealed that the gap was closer to $1,580,000. These revisions included figures relating to the revised endowment distribution, annual giving estimates, early college revisions, revised financial aid estimates and an increase in other expenses, such as utilities.

Heather Hayton, Assistant Professor of English and Chair of the Budget Committee, had this to say about the revised estimates: “As we worked to close that $1,580,000 gap we also continued to focus our energy on refining and revising our estimates because we felt very strongly as a committee, especially under [Vice President of Financing Jerry Boothby’s] leadership, that it is better to have realistic numbers than to wake up one morning with huge surprises.”

By carefully revising early projections, the committee hopes to close the gap and balance the budget. Three main actions will accomplish this goal. These include an increase in tuition, a slight increase in the number of first-year students and a decrease in the financial aid discount rate.

Guilford’s goal is to be in the “middle of the pack.” The average increase in tuition and fees next year is six percent among comparative schools. Guilford plans to increases tuition and fees by 5.5 percent.

Five percent was the original projection in the Strategic Plan. One year’s tuition for a double occupancy room will increase from $28,170 to $29,710 for a full pay student.

“These increases we see in higher education in general – I just can’t believe that that is sustainable, because we are coming up to the $30,000 suggested retail price,” said Jim Hood, Associate Professor of English. “I hope we are giving thought to not necessarily staying with the pack, but maybe breaking from the pack. I just have this awful feeling that higher education is really going to get slammed.”

“This is the stuff that keeps us awake at night,” said Randy Doss, Vice-President of Enrollment.

The second action taken to close the gap is to increase first-year enrollment from 411 to 431. This small increase will bring more revenue to the college and further close the gap.

Jack Zerbe, Professor of Theater Studies and budget committee member, had this to say about the increase: “[The budget] seems like it came down to cutting the rate, increasing the tuition, and getting more students. Of course, then what does that mean for the type of student we’ll get? Does that mean there will be a low standard of student that we will get as well?”

Doss responded to Zerbe’s question: “A year ago we finished with 2,491 applications, which was a 30 percent increase over the previous year for traditional students. And yesterday we hit 2,575. So that gives us more flexibility than we have had. The key question is, ‘are we number one on peoples’ list or are we number six on peoples’ list?’ and certainly only time will tell. Historical data tells us we are going to yield between 25 percent and 27 percent of the accepted students, so that means I have to accept 1750 to get 431 at 26%. The problem is I don’t know which 26% are going to accept our offer, but I know which 26% I want.”

The third way in which the gap will be closed is decreasing the financial aid discount rate from 40.5 percent to 40 percent. The moderate decrease will further close the gap and help balance the budget.

Increasing tuition, accepting more students and adjusting the discount rate are the three main ways the college is balancing the budget and setting the course for financial stability.