I've read way too much stuff from people on here that have no idea how a university runs or how an endowment works say that NU should just start building athletic facilities and that the higher ups are too cheap and don't care about sports to that. If you believe that, then you have no idea how things work.
1. The endowment isn't a giant pile a money to be used for anything. A lot of it is based on donations that are specifically marked for things that are important to individual donors. This could be certain schools, programs, or departments. This could be campus general campus beautification. This could be something as specific as donating $500,000 with the intention of using a 7% return per year of $35,000 for upkeep, improvement and maintenance of the Shakespearean Garden. So you need to take the endowment and cut it down by earmarked donations.
2. The endowment's $9,000,000,000 isn't money the university can spend. I heard a stat that a similar university to Northwestern costs $1.5-2 million dollars to run per day. That combines the salary of all the university employees from top level professors down to janitors, the police, the cafeteria workers... That's 547.5-730 million dollars per year. Divide that into 8500 students and you get $64,411-85,882 needed in tuition. Tuition is $61,640.
So why can't NU spend the endowment on athletics if sales are meeting costs given that it's a not for profit?
That's a pretty easy answer. Most kids are not paying full or anywhere close to full tuition. It's not even close and is probably less than 1/2. That means Northwestern is taking in less than 250,000,000 in tuition. The remainder needs to be made up with a return from the endowment. Let's say that the 1/3 of the endowment is earmarked leaving $6 billion. We can make a modest return of 7%. That gives you a return of $420,000,000. You add that to the the 250,000,000 in tuition, and you're left with $660,000,000 which is right in line with the $1.5-2 million dollar per day cost.
If NU were to completely overhaul it's sports facilities, that's 270,000,000 for a practice facility, 288,500,000 for a football stadium (based on TCF Stadium at Minnesota), and 180,700,000 for a basketball stadium (based on Pinnacle Bank Arena at Nebraska). That totals 750,000,000 out of the endowment. This means, you would expect $52,500,000 less of a return on admission. That's $6,562 of extra tuition money needed per student per year, and since the average student pays about 50% tuition (if that), that's going to raise tuition by $13,125.
So hey, let's completely redo all the facilities... and raise tuition to 75,000 per year!!!!
1. The endowment isn't a giant pile a money to be used for anything. A lot of it is based on donations that are specifically marked for things that are important to individual donors. This could be certain schools, programs, or departments. This could be campus general campus beautification. This could be something as specific as donating $500,000 with the intention of using a 7% return per year of $35,000 for upkeep, improvement and maintenance of the Shakespearean Garden. So you need to take the endowment and cut it down by earmarked donations.
2. The endowment's $9,000,000,000 isn't money the university can spend. I heard a stat that a similar university to Northwestern costs $1.5-2 million dollars to run per day. That combines the salary of all the university employees from top level professors down to janitors, the police, the cafeteria workers... That's 547.5-730 million dollars per year. Divide that into 8500 students and you get $64,411-85,882 needed in tuition. Tuition is $61,640.
So why can't NU spend the endowment on athletics if sales are meeting costs given that it's a not for profit?
That's a pretty easy answer. Most kids are not paying full or anywhere close to full tuition. It's not even close and is probably less than 1/2. That means Northwestern is taking in less than 250,000,000 in tuition. The remainder needs to be made up with a return from the endowment. Let's say that the 1/3 of the endowment is earmarked leaving $6 billion. We can make a modest return of 7%. That gives you a return of $420,000,000. You add that to the the 250,000,000 in tuition, and you're left with $660,000,000 which is right in line with the $1.5-2 million dollar per day cost.
If NU were to completely overhaul it's sports facilities, that's 270,000,000 for a practice facility, 288,500,000 for a football stadium (based on TCF Stadium at Minnesota), and 180,700,000 for a basketball stadium (based on Pinnacle Bank Arena at Nebraska). That totals 750,000,000 out of the endowment. This means, you would expect $52,500,000 less of a return on admission. That's $6,562 of extra tuition money needed per student per year, and since the average student pays about 50% tuition (if that), that's going to raise tuition by $13,125.
So hey, let's completely redo all the facilities... and raise tuition to 75,000 per year!!!!
