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More colleges cutting costs

June 13, 1999|By GREG SIMMONS

When students return to college this fall, they may find a new bunch of corporate names greeting them as they eat, buy books or buy a drink at their college athletic games.

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One of the biggest trends in higher-education cost cutting is for institutions to hawk off bits and pieces of traditionally institutional bodies - such as campus bookstores and dining facilities - to such corporations as Barnes & Noble and Marriott.

By deferring responsibility to the experts, universities can focus more on the administration of education, proponents say.

"They have a model which seems to work," said Frank Buhrman, a spokesman for Mount St. Mary's College in Emmitsburg, Md., regarding the Barnes & Noble book chain.

Barnes & Noble has bought several area campus bookstores and others across the country, including ones at Mount Saint Mary's; the University of Maryland, College Park; West Virginia University at Morgantown; all Penn State system schools and a few Ivy League schools, such as Columbia University.

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Stan Frank, Barnes & Noble's director of marketing for the college bookstore division, said the reasoning for privatization is simple: "One, the level of service, and, two, more money comes to the store."

"We run better stores than the school runs on their own or can afford to run on their own," Frank said. "It's kind of a win-win situation (for both parties)."

Buhrman said at Mount St. Mary's, the continuing demand to maintain adequate levels of financial aid and educational technology continues to drive overall costs up.

Conversely, higher-ed competition is continuing to keep tuition levels low, so universities have to find funds from other sources or eliminate strains on the university's purse strings, Buhrman said.

Mount St. Mary's tuition rose from $15,900 last year to $16,520, a 3.9 percent increase; the University of Maryland's full-time, undergraduate tuition for in-state students rose from $3,894 to $4,050, a rise of 4 percent; and Wilson College raised tuition 2.5 percent.

Only Frederick and Hagerstown community colleges kept rates stable - both kept in-county resident rates to $70 per credit hour, which for a 15-credit semester would run students $1,050 before a slew of fees, some of which are flat and others are per credit hour.

In comparison to the inflation rate - average prices rose 2.2 percent in the 12 months ending in April, according to the Bureau of Labor Statistics - this increase, and the increase of most other colleges in the area is meager, university administrators say. But tuition rates do not always reflect the cost to students.

"Tuition may be a euphemism for the total cost to college," said Joseph Vivona, the vice chancellor of the Office of Administration and Finance for the University System of Maryland.

He said he thinks the general public likes to use tuition as the measuring stick for the price of education, but that can be misleading. Vivona said higher education systems place a "firewall" between tuition, which reflects the academic costs, and auxiliary costs, which represent excess such needs as athletic facilities and dining services.

Tuition alone is affected primarily by streamlining administration, buying more efficient products and services and utilizing "pouring rights," Vivona said.

"Pouring rights" literally refer to contracts allowing one company to reign over a specific area: in College Park, the University of Maryland campus sold its rights to PepsiCo., booting out almost all Coca-Cola products.

In addition to privatization, cutting back administration is an important cost-cutting tool. In Pennsylvania, the State System of Higher Education - Shippensburg University is a part of this system - uses 11 people to administer payroll services to the 12,000 employees of the 14-school system, said Kenn Marshall, the system's press secretary.

Marshall said 80 percent of that system's costs are personnel-related. Most university administrators said their personnel costs float between 70 and 80 percent of overall costs. He also said that only one of the 14 Pennsylvania schools maintains a school-run bookstore.

Auxiliary costs, such as bookstores and dining services, if not privately contracted, are still fees that students must pay to attend the school. Because athletic departments must still be student supported to some degree, and schools are constantly upgrading technology and therefore creating new fees, the whole fee process should be monitored carefully, said the University System of Maryland Student Regent Susan Woda.

"For students, (an extra fee of) $200 is working 40 extra hours a week," Woda said. One of her greatest battles as the one voting student on the University System of Maryland's Board of Regents is against unjustified fees and and those added with little or no explanation to the students, she said.

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