Yale Projects Balanced Operating Budget for Second Year
Yale University’s proposed operating budget for 1998-99, which for the second year in a row is balanced, projects spending of $1.16 billion, an increase of approximately 5 percent over the current spending plan.
The major sources of revenue for the University are grants and contracts – 27 percent, term bill income – 23 percent, endowment spending – 19 percent and medical services income – 16 percent. The endowment spending of more than $226 million is an increase of 15 percent over 1997-98. University Budget and Planning Director Gary Sax says endowment spending accounts for almost twice the share of the operating budget than it did a decade ago.
In addition, gifts for current use, which are not invested in the endowment, total $58 million, or 5 percent of operating revenue, for 1998-99. Together, gifts and income from the investment of gifts – endowment spending – are expected to provide nearly a quarter of the University’s revenues.
Deputy Provost Charles H. Long notes that the expected growth of grant and contract income by 7 percent and the increase in medical services income by 4 percent exceeded expectations in the recent past. “A few years ago we feared that, because of outside forces over which we had no control, growth would be flat regardless of how hard we worked,” Long says. “You don’t get grants and contracts and medical service income by accident.”
The budget estimates that 53 percent of revenues will be devoted to salaries and fringe benefits for faculty and staff. Student financial aid accounts for 9 percent, or $112.4 million, of expenditures.
The budget’s term bill income reflects a 2.9 percent increase in the term bill for Yale College, the lowest in three decades. To maintain its policy of meeting the full demonstrated financial need of Yale College students, the budget includes $30.5 million for aid, a total which reflects the University’s adoption earlier this year of enhancements in financial aid. “Yale is more accessible this year than last,” Long says.
The budget proposal also allocates $15.2 million for capital maintenance, carrying on Yale’s 10-year plan, adopted in 1995-96, to build adequate funding of $50 million – in 1995-96 dollars – for the capital maintenance needs of its facilities into the annual operating budget.
Noting Yale’s success in recruiting faculty over the last two years, budget officials say the operating budget funds compensation and support of these new faculty, as well as providing faculty salary increases exceeding those of recent years, thereby sustaining Yale’s competitiveness with peer institutions.
The operating budget also makes needed investments in academic and administrative computing, administration officials say.
The University also announced that the Capital Budget for 1998-99 calls for spending of $241 million. During the upcoming fiscal year, the University will be completing its work on Linsly Chittenden, Sterling Memorial Library, the Music Library, the “swing dorm” that will house Yale College students during renovations of residential colleges, the Sterling Law School and the Central Power Plant. Other facilities receiving significant capital funding during the year will be Payne Whitney Gymnasium, Berkeley College and the new School of Art building on Chapel Street. The anticipated total cost of all current building and renovation projects – many of which are multi-year initiatives – is nearly $1 billion.