The 2017-18 Budget
To: The NYU Community
From: NYU Provost Katherine Fleming and Executive Vice President Martin Dorph
Date: Monday, May 15, 2017
We’re writing to share the principal elements and priorities of the budget in support of NYU’s academic mission during 2017-18. We’ll be proposing them in June to the members of the Board of Trustees for approval.
NYU’s proposed operating budget for 2017-18 (for all parts of the University other than the NYU Langone Medical Center) is $3.276 billion. That is 7% greater than this year, largely owing to routine inflationary growth in salaries and other University expenses, and planned growth in programs such as the College of Global Public Health, as well as growth in NYU Abu Dhabi and NYU Shanghai (no funds for which come from the Washington Square campus).
The proposed capital plan – for major, multi-year investments in new facilities, technologies, and equipment – projects spending of about $732 million in 2017-2018, and $2.726 billion for 2018 through 2025.
The Operating Budget
The proposed operating budget for 2017-18 represents ongoing annual spending for programs, personnel, goods, and services, as well as adjustments for priorities. Among the priorities for the coming year are affordability measures; support for equity, diversity, and inclusion efforts; and enhancing public safety.
Cost-of-Attendance and Affordability: Guided by President Andrew Hamilton’s emphasis on affordability, for 2017-18 we are once again proposing a reduced increase in cost-of-attendance (tuition, fees, room, and board) for most undergraduate programs: 2.3%. This reflects an increase in tuition and fees of 2.9%, and an increase in room and board of 0.6% for most entering freshmen (reflecting in part a new, lower-cost default meal plan).
As you will recall, the increase in undergraduate cost-of-attendance from last year to this was also significantly reduced: 2.0%. The two-year increase represents the lowest two-year increase in more than 20 years. It’s also considerably lower than the increases posted for the comparable period by the private colleges and universities against which we typically compete for students.
In addition, another 50 beds within the student housing system will be designated as lower-cost. Between last year and this year, the percentage of beds designated as lower-cost now stands at almost 30%.
Offsetting savings for the two-year period were achieved through reductions in other-than-personal-services (OTPS) and other administrative expense savings.
Scholarship Aid: The undergraduate scholarship aid budget – which currently is $410 million – will increase by 6.1% – or $25 million – for 2017-18.
Stipends for fully-funded Ph.D. students are expected to increase by 2.5%.
This year, NYU raised $117 million for the Momentum Campaign, the $1 billion campaign to support improved scholarship aid. In total, NYU has raised $762 million towards the Momentum Campaign goal.
Annual Merit Increases and Other Compensation: For 2017-18, the annual merit increase (AMI) pool will be as follows:
- For tenured and tenure-track faculty: the AMI pool will be 2.5%
- For full-time continuing contract faculty: the AMI pool will be 2.5%
- For administrators: the AMI pool will be 2.5%
Unionized employees – adjunct faculty, clerical workers, public safety officers, and graduate workers, among others – will receive increases in line with their collective bargaining agreements.
Consistent with previous affordability-related commitments, student workers will receive a minimum of $13.50/hr for undergraduates beginning September 1, 2017.
Fundraising and Endowment: In 2015-16, NYU raised $506.4 million. Between September 1, 2016, and the beginning of May 2017, NYU raised $362 million, putting us ahead of last year at this time and on our way to achieving the $600 million FY17 fundraising goal. As noted previously, $117 million was raised towards scholarship aid through the Momentum Campaign, including 20 gifts of $1 million or more.
The value of the endowment as of August 31, 2016 was $3.61 billion, up from $3.48 billion a year prior. The endowment is expected to contribute approximately $131 million to the University’s annual operating budget.
The Capital Plan
Major projects in the coming years include:
- 370 Jay St., which will serve as a hub for media, technology, and the arts in Brooklyn. Its occupants will include CUSP; two Tandon departments – Electrical and Computer Engineering, and Computer Science and Engineering; MAGNET; two programs from Steinhardt – the Music and Audio Research Laboratory and Educational Communication and Technology; and Tisch’s ITP program and the Clive Davis Institute of Recorded Music, among others.
- 181 Mercer St., which will provide dozens of new classrooms; new, specialized performing arts instructional spaces; student housing; faculty housing; and a replacement athletics facility for Coles.
- 404 Lafayette St., which will be the home for the College of Global Public Health.
Rogers Hall, a principal instructional and lab building at the Tandon School of Engineering, will be renovated and upgraded.
- The Co-Generation Plant, which will be upgraded and expanded to allow for additional high-efficiency, low-emission electrical generation capacity.
- Ongoing Renewal and Replacement of infrastructure and equipment in existing buildings.
Debt rating upgrade: In evaluating NYU’s latest issuance of bonds to fund capital projects, including a number of the projects cited previously, Moody’s Investors Service upgraded its rating of NYU bonds to “Aa2” from “Aa3”. Upgrades reflect positive evaluations of NYU’s financial health, and are associated with lowered costs for borrowing.
Standard & Poor’s Global Ratings assigned a “AA-” rating for NYU’s debt, in line with their previous ratings.