from Vice President for Finance Samuel E. Jones '75, M.B.A. '80
William & Mary’s Financial Performance
Fiscal year 2013 saw continued improvement in the College’s finances as revenues remained strong and expenditures reflected strategic plan priorities. The College’s financial health reflects an ability to recruit outstanding students; to maintain its status as both a public institution within the Commonwealth of Virginia, as well as an internationally recognized “Public Ivy;” to raise revenue through tuition and fees, grants and contracts, and private funds; and a willingness to reallocate funds toward higher priority items.
William & Mary continues to recruit, admit, and retain top-caliber students even as the College competes with the most selective public and private institutions in the country. Freshman applications to the College reached a new high of 14,047 for fall 2013. The credentials of our admitted students remain strong, reflecting the highly selective nature of the College. These statistics, coupled with the College’s academic reputation, suggest strong student demand into the future.
Fiscal year 2013 saw renewed state investment in William & Mary and its programs, slowing the decades-long decline in state operating support. Revenue from tuition and fees, self-supporting auxiliary enterprise activities (residence halls, food service, intercollegiate athletics, etc.), grants and contracts, and private giving provided the diversity of funding critical to the university’s overall financial health.
Expenditures reflected William & Mary’s strategic priorities in maintaining the quality of its academic programs. Salary support for faculty and staff; financial aid for undergraduate and graduate students; and programmatic support for additional enrollment, faculty research, the new marine science minor, and international/study abroad activities serve to move the College forward in these vital areas.
The rebound in the value of endowments benefiting the College that began in fiscal year 2010 continued into fiscal year 2013. By June 30, 2013, the consolidated value of endowments held by all of the various entities supporting the College and its programs totaled $697.7 million, an increase of 8.3 percent above the June 30, 2012, value and a record high for the College. Strong investment performance by the Board of Visitors and The College of William & Mary Foundation endowments, combined with increased gift flow, supported this increase. The Board of Visitors’ endowment and the Foundation’s William & Mary Investment Trust, the largest of the College’s investment portfolios, remain highly diversified across asset classes. A more detailed discussion of investment performance follows.
Construction and renovation activity remains brisk on campus. The English department returned to its home facility in the newly renovated Tucker Hall. A combination of private and state funds allowed for a complete renovation of the Brafferton, home to offices for the president and the provost. Planning is well under way for the final phase of the Integrated Science Center (ISC) and for the renovation of Tyler Hall. Because the ISC 3 and Tyler Hall projects have been authorized by the state, the College will move forward with construction as soon as planning is complete.
On the non-academic side, construction of the new fraternity houses is complete. This project dramatically improved fraternity housing, while adding an additional 187 beds to William & Mary’s on-campus inventory. The College’s purchase of the Hospitality House, a hotel adjacent to campus, reaffirms the university’s residential commitment. In fall 2013, students moved into portions of the building, which has been renamed One Tribe Place. Planning continues regarding the long-term use of conference, restaurant, and other space available in the building. The College also completed an expansion of the dining facility in the Sadler Center to provide better service and a late-night dining option for students.
The Board of Visitors and the administration remain focused on how best to attract and retain the very best students, faculty, and staff while enhancing program quality, affordability, and access. Recognizing the need for additional investment in the College, the Board of Visitors in April approved The William & Mary Promise, a new operating model that provides vitally needed resources to secure the future of Virginia’s distinctive “Public Ivy” while markedly enhancing predictability, affordability, and access for Virginia students. Key elements of the promise include:
- A four-year tuition guarantee. The promise provides Virginia families with financial predictability through a commitment to incoming, in-state students that tuition will remain constant through all four years of their undergraduate study. Entering Virginia students now know exactly what their tuition costs will be for all four years at William & Mary, and those costs will not rise from year to year.
- Tuition capped at the Consumer Price Index for returning Virginia undergraduates. For in-state, undergraduate students enrolled at William & Mary before adoption of the new model, the promise caps annual tuition increases to no greater than the rate of inflation.
- Relief for middle-income families. The promise reduces the “net tuition” paid by middle-income families, as defined by the state’s Higher Education Advisory Committee (HEAC). More than 70 percent of Virginia households qualify as middle-income under the HEAC definition. Under The William & Mary Promise, students from middle-income families who qualify for need-based financial aid pay no more “net tuition” (tuition less financial aid) than under the former model.
- Less debt for William & Mary graduates. The promise reduces by up to $8,000 the four-year loan burden for middle-income, in-state undergraduate students who have demonstrated financial need. Specifically, the plan lowers the maximum amount of loans included with an in-state financial aid package by 36 percent ($2,000 annually) for families with an income between $40,000 and $60,000, and by 18 percent ($1,000 annually) for all other families with demonstrated financial need. Students from Virginia families with a household income of less than $40,000 will continue to receive financial aid that covers 100 percent of their need with grants.
- Additional Virginia students. The promise provides additional accessibility to the College by enrolling an additional 150 in-state students by 2016.
The William & Mary Promise ensures that all Virginia students, regardless of income or financial aid eligibility, will continue to receive a “Public Ivy” education for less than it actually costs the College to provide that education. Even after the step increases in tuition, William & Mary as a public university will be subsidizing the education of all in-state students, even those whose family incomes and assets make them ineligible for financial aid.
Funds generated through the promise, in combination with private and reallocated funds, allow the College to move forward with key elements of its strategic plan. Faculty and staff salaries and undergraduate financial aid support remain top priorities, even as the College continues initiatives that expand technology-based instructional methods, interdisciplinary opportunities, applied learning, and global education and awareness.
Capital funding now shifts to the programmatic and space needs of William & Mary’s various arts programs. Prior studies have more than adequately documented the condition and space needs in theatre, speech, dance, music, art and art history, and the Muscarelle Museum of Art. The College’s six-year capital plan submitted to the Commonwealth of Virginia last spring requests funding to support the phased implementation of an “Arts Quarter” to provide quality instructional, performance, and exhibition space for William & Mary’s students, faculty, and visitors.