From today's Chronicle of Higher Education comes a story about how colleges are trying to seek additional revenue amidst the downturn in the economy by retooling their fund-raising offices. In part, this focus on getting additional revenue explains why costs have outpaced inflation. Economist Robert E. Martin examined the incentives within higher education and explains this as a "cost spiral." Here are the essential paragraphs about Pomona College.
Pomona College, in California, had also staffed up its fund-raising office in recent years to focus on soliciting major gifts. Pomona, which has a longstanding and successful deferred-giving program, did not have a major-gifts program. Last summer the college doubled its major-gift staff from three to six, and made a priority of paying for their travel, says Christopher Ponce, vice president for institutional advancement.To finance those changes, Mr. Ponce moved money from other divisions in the advancement operation, such as communications. Also, the college is offering early retirement, which may leave some positions open."The goal is to achieve budget reductions you can live with," he says.