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ND to continue need-blind admissions

Jenn Metz | Friday, November 14, 2008

With the stock market down, college affordability has become a significant issue for families across the country. Recent articles in national newspapers like The New York Times have examined the state of financial aid and the feasibility of a need-blind admissions process in today’s economy.

The University of Notre Dame will remain committed to two of its admissions’ goals – accessibility and affordability – and will respond to the economic crisis facing the United States in “typical Notre Dame fashion,” Joseph Russo, Director of Student Financial Strategies in the Office of Student Financial Services told The Observer.

“We’re staying steady, focused in a positive direction … we’re typically very deliberate and pretty conservative,” he said. “In terms of our finances, we’re one of the most stable institutions in higher education.”

Russo said he agrees with representatives from other colleges and universities who say college affordability is becoming a concern.

“It has for families, it has for policy makers, and it certainly has for the media,” he said.

Families, he said, are now wondering if they can still realistically aspire for their children to attend four-year private institutions, like Notre Dame, or if they need to look at four-year public or two-year community schools. Likewise, policy makers – both governmental and institutional – are concerned with trying to constrain the rising cost of college, he said.

“How can college costs continue to rise at this rate, and what will they be like in 50 years? These are legitimate concerns,” Russo said.

According to a report recently released by The College Board entitled “Trends in College Pricing,” college price increases have generally kept pace with the rising inflation, as measured by the Consumer Price Index (CPI).

In the 2008-2009 academic year, the average tuition and fee listed prices for undergraduates currently attending four-year private, non-profit postsecondary institutions increased by 5.9 percent.

The average price increase was higher than the 5.8 percent increase in CPI as of July 2008.

Tuition, fees, room and board prices at four-year private, non-profit institutions increased by 5.6 percent, according to the report. According to a companion report, titled “Trends in Student Aid,” also released by The College Board, the total grant, work-study and education tax benefits to college students rose to a record high in the 2008-2009 academic year – $143.4 billion.

Annualized over the period of the last 10 years, University tuition has gone up, on average, 6 percent each year. The 2008-2009 amount of $36,850 is a 4.8 percent increase from 2007-2008’s $35,190.

Taking into account tuition, fees, room and board, equaling the total bill, this year’s figure of $46,680 is a 4.9 percent increase of last year’s $44,480.

Notre Dame financial aid: A profile

Financial aid is determined at Notre Dame by first figuring out the amount a family is able to pay, Russo said, and then calculating their financial need.

Need is measured “very carefully,” he said.

Depending on the resources in question, need is calculated by two different methodologies – federal and institutional.

The federal government is a “big provider of student aid – through federal grants, federal loans and work study,” Russo said.

The federal methodology “drives eligibility for need-based federal student aid,” he said.

For Notre Dame dollars, the University uses a similar methodology called institutional methodology, a product of The College Board, which many schools subscribe to.

“This is not a perfect science – we gather as much information as we can from the family, we verify it with tax documents and we review the initial reading that The College Board sends us, and sometimes make adjustments to that, and in the end, we come up with a number that we think is reasonable for the family,” Russo said.

These calculations make several assumptions – including the family’s willingness to contribute, he said.

“There’s clearly going to be, for a lot of families, a lot of sacrifice … and a lot of hard work.”

A combination of work and/or loans and University Scholarships may be added to the financial aid package, to cover the family’s need and to reach what the Office of Financial Aid calls the “Cost of Attendance.” This figure takes into account tuition and fees, room and board, books and supplies, as well as personal and transportation expenses.

The average freshman scholarship this year will be between $22,000 and $23,000, Russo said, and roughly 45 percent of students receive University scholarships. Athletes and the children of University employees who receive educational benefits are not included in either of those figures, he said.

About three quarters of all Notre Dame undergraduates receive some sort of financial help from some place – including athletes and children of University employees.

During the 2007-2008 academic year, over $270 million dollars were given to all Notre Dame students. Of that total, $167 million was given to undergraduates, and specifically $39 million was given to freshmen.

These percentages are comparable to peer institutions such as the Ivy League schools, Duke, Northwestern and Stanford, Russo said.

The University is one of the charter members of an organization called the 568 Presidents’ Group – comprised of 27 institutions committed to need-blind admissions and to addressing “some real serious issues that created divergence in how families ability to pay was being calculated,” Russo said.

Russo is a member of the Group’s technical committee working to solve these problems and come up with a consensus approach to determine a family’s ability to pay.

“We’re all going to do it the same way – that’s the consensus approach,” he said.

‘Affordable and accessible’

Notre Dame is committed to meeting 100 percent of students’ demonstrated need, Russo said, and the University plans on continuing its previous admissions and financial aid policies, even though the economy may negatively affect its financial situation this year.

Notre Dame is need-blind during the admissions process – “which is referenced by a couple of presidents in recent articles as something that is very difficult to do,” he said. “But we will remain that way.”

Being a need-blind institution is the University’s “premier policy” in terms of admissions and financial aid, Russo said. A Need-blind institution does not consider an applicant’s financial situation when making admissions decisions.

“There are not a lot of high-cost private institutions that have this policy, and those that do are going to be looking hard at it this year,” he said.

Notre Dame, however, will be keeping this policy.

“We want to be accessible to anybody, we want the admissions decision to be based on applicants’ credentials as they compete with other students, not on whether they can afford to come here,” Russo said. “Only a handful of high-priced privates can say that. If you’re admitted, we can look anyone in the eye and say, ‘We can make this happen.’

“We can make it affordable – we want access and we want affordability,” he said.

The University has a “very generous” policy dealing with the treatment of outside scholarships – that is, scholarships from outside groups like a local Rotary Club or the National Merit Scholarship. Part of this policy has to do with being competitive with peer institutions, Russo said.

Notre Dame allows the money received in outside scholarships to count toward the amount of work and/or loans in a student’s financial aid package.

“That’s very generous. Most schools haven’t met families’ need, and that gap needs to be filled with outside scholarships, and those who have met need might not be as generous in the way they treat outside scholarships,” he said.

Scholarships awarded by about 140 of the world’s roughly 280 Notre Dame Alumni Association Clubs fall under the category of outside scholarships, Russo said. These figures added up “to the tune of over $2.7 million this year.”

“That’s very special for Notre Dame and I don’t see that changing – I see it growing,” he said.

Although the University does not currently plan on cutting out loans for all students, Russo said that might someday be a possibility.

“There will be students, in the end, who don’t have any loans,” he said.

Where does the money come from?

Russo said money for University scholarships come from three places – the University endowment, private donors and tuition.

The first two sources provide what Russo called “real money” to pay students’ bills. Twenty-five percent of the University endowment is allotted for scholarships

The third source, called tuition discounting, is the single-largest source of University Scholarships, he said. Tuition discounting uses what Russo called “funny money.”

This method reduces the student’s bill “behind the scenes,” which creates an expense that has to be offset by revenue. The primary source of revenue for the University is tuition, “so everybody’s tuition has got to come up a bit to pay for this reduction,” Russo said.

The national average tuition discount rate is 40 percent, he said. Some schools have reached their limit as far as tuition discounting goes, and are currently running into trouble, he said.

“We would like to have most of our scholarship dollars be real dollars and to not put the burden on tuition,” Russo said. “We’d like the tuition discount rate to be zero – that’s a tough goal to reach.”

A $1.5 billion fundraising campaign is currently underway, he said – the third University fundraising campaign in the last 15 years. The No. 1 priority of these campaigns has been undergraduate scholarship endowment.

Reviewing packages

No immediate changes are planned to the University’s policy of reviewing or re-evaluating financial aid packages.

Russo said there has been “nothing out of the ordinary” in terms of circumstances brought to the Office of Financial Aid’s attention, like a parent losing his or her job or the death of a parent.

In these cases, the University does re-evaluate aid packages.