How much money does it cost to run a college?

Josh Chilson

Josh Chilson

Running a college is expensive. It costs more than what is paid in tuition and fees. Much more. Not even student loans could pay for it all. Public universities like SDSU receive funding from both the federal and the state governments. Other sources also contribute money that benefits SDSU students.

According to the South Dakota Board of Regents Fiscal Year (FY) 2008 Fact Book, SDSU had an operating budget of about $165 million for 2007-2008. This figure increases each year.

“Regardless of what some people may think, generally our budget does go up each year, even if it’s only salary increases,” said Jeri Kurtz, the director of institutional research in SDSU’s Finance and Business Office. “As long as enrollments go up, our budgets will increase.”

A little over $58 million of the total budget came from direct costs to students. This includes tuition, room and board and student fees.

How do broke college students pay for their share? Last year, SDSU students as a whole received a little over $18 million in scholarships and grants. The rest of the bills are covered by a little work and a lot of loans. The average 2007 SDSU graduate left school with over $20,000 in student loans.

Students also pay indirect fees, such as books at the bookstore. In the budget, these costs are categorized as “other.” This category, which accounts for $40 million of the budget, includes revenue from the bookstore, dairy plant and meat lab. In addition, it includes self-support tuition – or extra money that students pay for certain programs like nursing or classes in Sioux Falls – and grants from private sources such as soybean producers or the pork industry. It is not specified in the Board of Regents’ budget how much of this “other” category is generated by students or how much by other private sources.

A large contributor to the financing of SDSU is the state of South Dakota. State general fund money accounted for almost $45 million of SDSU’s FY08 budget. This was taxpayer money that state government appropriated for higher education.

In the fiscal year 2007, South Dakota spent about 15 percent of its general fund appropriation on postsecondary education. That amounts to about $224 per capita in taxes in South Dakota spent on the state funding of public universities.

Federal funding accounted for about $21 million of the budget. These are typically federal grants that are requested directly by an individual or group within the university that is seeking funding of a special research project or program.

SDSU also received about $550,000 from the School and Public Land Department. In addition, SDSU received $130,000 from the higher education facility fund, or HEFF. This money goes toward maintaining buildings and facilities.

Another area that contributes a great deal of money to SDSU and is not accounted for in the Board of Regent’s budget is the SDSU Foundation.

Steve Erpenbach, the President and CEO of the SDSU Foundation, said the Foundation’s goal is to “raise and administer money that will benefit the students of SDSU.”

The Foundation raised $21 million through private donations last year, up from an average of about $15 million over previous years. This money goes towards scholarships, assorted projects or new buildings: whatever the donor wants it to be spent on.