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Operating Budget Detail

Major Categories of Revenue

Tuition and fees net of financial aid for undergraduate and graduate students account for 54% of total operating revenue.

Student housing and dining contribute 10% of operating revenue, while all other auxiliary operations account for 5% of the total.

Expendable philanthropic contributions account for 5% of total revenue for operations. Gifts to endowment and gifts for construction (i.e., not expendable for operations) are in addition to this total.

Endowment distributions, combined with earnings on short-term investments of operating cash balances, provide 4% of the revenue budget. (The market value of NYU's total endowment at August 31, 2012 was approximately $2.8 billion, of which, $796 million was for the NYU Langone Medical Center.)

The budget assumes a total return on endowment investments of 6%. Distributions from endowment to support operations are generally calculated as 5% of the endowment’s 12 quarter (three years) average market value, with certain caps on the allowed distribution to further moderate volatility.

Income from commercial real estate represents 3% of the revenue budget.

Sponsored research accounts for 4% of total revenue, and sponsored educational programs account for 8% of the total.

Clinical income from dental patient care provides 2% of operating revenue.

All other sources of revenue total 5%. This category includes many relatively small items such as service payments from the School of Medicine, annual appropriations from the State of New York, and transfers from non-operating funds.

Major Categories of Expense

  • Expenditures for salaries and employee fringe benefits comprise 52% of all expenses.
  • Operation and maintenance of the physical plant accounts for 19% of the expense budget, divided as follows: 2% for energy, 5% for rent, 6% for debt service, and 6% for cleaning, building maintenance contracts, and all other expenses.
  • General operating expenses account for 18% of the budget.
  • Five percent of the budget is transferred to non-operating funds, primarily the capital fund for construction and information technology projects.
  • Professional services and fees make up 4% of the expense budget.
  • Two percent of the budget is designated for contingency and academic investments designated by the Provost.

Expenditures by Purpose

Another way to view the expense budget is by purpose of expenditures.

  • Expenditures by schools and institutes comprise 67% of the total budget.
  • Facilities management and campus safety account for 14% of total expenditures, divided as follows: 4% for student housing, 1% for faculty housing, and 9% for academic buildings and general infrastructure.
  • The direct cost of auxiliary operations, including student housing, dining, and residential education, account for 4% of the total budget. When the fully allocated costs of facilities management and administrative operations are added, the expenses of auxiliary operations more closely match the revenue from auxiliary operations.
  • Administrative units comprise 7% of the total expense budget and include budgets for services such as development and alumni relations, human resources, finance, legal, and contingencies.
  • Provostial operations, including such units as the offices of the Provost, Admissions and Financial Aid, Institutional Research, Registrar, EVP Health and SVP Research, represent 3% of total expenditures. This expense category also includes budgetary reserves for academic initiatives.
  • Information technology services accounts for 3% of the total, and student affairs accounts for 2%.
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Undergraduate Student Charges

The combined rate of increase in undergraduate tuition and fees in the fiscal 2013 budget over the prior year is 3.8%. Compared with 25 peer private non-profit institutions, NYU’s rate of increase is below the group’s median and mean. The rate of increase for room and board charges for a typical arrangement of an entering freshman was 3.5%, also below both the median and the mean rates of increase of the comparison group. A recent survey by Campus Grotto ranks NYU’s charge for tuition and fees as 51st among private non-profit colleges and universities in the United States. NYU’s cost of student housing, however, is higher than most universities, due to its location in New York City.

The budget for undergraduate financial aid (institutional grant-in-aid) in fiscal 2013 increased by 10% over the budgeted amount for fiscal 2012. This compares with a total increase of undergraduate tuition and fees (driven by both rate and enrollment growth) of 5.7%.


Endowment per Student

In a national study of 518 private institutions' endowments at June 30, 2011, NYU's total endowment (including the School of Medicine) was the 18th largest in total size, but 163rd in endowment per student (or $75,003 per student).


Endowment Performance

The Endowment is invested with a long-term orientation. For the three years ended August 31, 2012 the Fund has delivered an annualized return of 7.8% per year, outperforming the passive 60/40 blended benchmark return of 6.7%, while incurring one-third less the amount volatility. This means that on a risk-adjusted basis, the Fund has performed very well by providing not only a higher, but also a more stable source of support to the University’s operating budget than the benchmark.


Employment

In the Fall 2012 semester, the University employs approximately 8,000 individuals in academic positions as full-time and part-time faculty members and researchers, and approximately 5,000 individuals as full-time and part-time technical, clerical, service, and administrative employees. In addition, throughout fiscal 2012, the University is likely to employ approximately 8,000 part-time students in hourly positions.


Some Highlights of Changes in the Budget over the Past Five Years

Between fiscal years 2009 and 2013:

  • The portion of total revenue received from net tuition and fees was reduced from 59% to 54% over the past five years.
  • Salaries and fringe benefits increased from 50% to 52% of total expenses
  • The budgets for schools and institutes rose from 60% to 67% of total expenses, while budgeted expenditures for administrative operations fell from 10% to 7% of total expenses
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