1. Understanding College Costs and Price through Delta Metrics
Education Writers Association National Seminar
Steve Hurlburt
May 17, 2012

2. The Delta Cost Project
Mission: to improve college affordability by helping policy makers and higher education administrators understand higher education costs and productivity
Focus: how colleges and universities spend money; how tuition (price), other revenues, & spending relate to one another
Tools: reports and briefs; online analysis system; website with available resources

3. Cost vs. Price
Cost: what institutions spend to provide an education to students
Price: what students pay to receive the education
Sticker price
Net price

4. Why do college tuition prices keep rising?
Other revenues decline (“Cost shifting”)
State appropriations for publics
Private gifts, grants, and endowments
Spending increases

5. Tuition revenue increases as state appropriations decline
Net tuition revenues and state and local appropriations revenues per FTE student, AY (in 2009 dollars)

6. Making sense of spending
Major expenditure categories
Education & related (E&R) spending: Core educational mission
Education & general spending: All core operating expenditures
Total operating expenses: All spending
Focus on E&R spending:
Spending for E&R versus other functions
Spending within E&R: Instruction and student services vs. administration
Education and related (E&R) expenses Total spending on direct educational costs. Education and related expenses includes spending on instruction, student services, and the education share of spending on academic support, institutional support, and operations and maintenance (i.e. "overhead").
Student services share of E&
Education and general expenditures includes all core operating expenditures, including instruction, research, public service, academic support, student services, institutional support, operations and maintenance, and net scholarships and fellowships. Expenditures; Equity
Auxiliary enterprises Expenses for essentially self-supporting operations of the institution that exist to furnish a service to students, faculty,

7. Total spending outpaced spending on core educational mission (E&R)
Total expenditures per FTE student by grouped categories,
AY 2004 and 2009 (in 2009 dollars)

8. E&R spending has increased more in private institutions than publics
Average E&R spending per FTE student by component, AY 2004 and 2009 (in 2009 dollars)

9. Understanding costs, price, & subsidies in higher education
For not-for-profit colleges, price is generally less than costs
Subsidy: difference between costs & price
Price + Subsidy = Cost
Costs
Subsidy
Price

10. Tuition revenues are covering a larger share of costs
Net tuition and subsidy shares of E&R costs, AY 2004 and 2009
(in 2009 dollars)

11. Explaining rising tuitions: Cost-shifting or increased spending?
Changes in net tuition, state and local appropriations, and education and related spending per FTE student, AY (in 2009 dollars)

12. Using data to improve oversight of college spending
Focus on patterns in spending for E&R
Is spending for instruction and student services being protected?
How are subsidies changing over time?
Education and related (E&R) expenses Total spending on direct educational costs. Education and related expenses includes spending on instruction, student services, and the education share of spending on academic support, institutional support, and operations and maintenance (i.e. "overhead").
Student services share of E&
Education and general expenditures includes all core operating expenditures, including instruction, research, public service, academic support, student services, institutional support, operations and maintenance, and net scholarships and fellowships. Expenditures; Equity
Auxiliary enterprises Expenses for essentially self-supporting operations of the institution that exist to furnish a service to students, faculty,

13. Website (www.deltacostproject.org)
Delta Cost Resources
Website (
State profiles (
Annual trends report
Issue briefs and other products
Trends in College Spending (TCS) Online (
Education and related (E&R) expenses Total spending on direct educational costs. Education and related expenses includes spending on instruction, student services, and the education share of spending on academic support, institutional support, and operations and maintenance (i.e. "overhead").
Student services share of E&
Education and general expenditures includes all core operating expenditures, including instruction, research, public service, academic support, student services, institutional support, operations and maintenance, and net scholarships and fellowships. Expenditures; Equity
Auxiliary enterprises Expenses for essentially self-supporting operations of the institution that exist to furnish a service to students, faculty,

14. Delta Cost Resources: Helpful Staff
Rita Kirshstein, Project Director (202) Steve Hurlburt, Deputy Project Director (202)