13 reasons why US colleges are in financial trouble

March 9, 2009

The Chronicle of Higher Education has come up with 13 common errors that have put many American institutions in dire financial straits. One of the most serious mistakes colleges made was to commit nearly every dollar of projected income to capital and operating expenses, opening the way for layoffs and budget cuts. With deferred maintenance already a problem in higher education, the building boom in the last decade has created a burdened future for institutions. Many schools have relied on low-interest bonds and loans, which are now a lot more expensive to carry after the credit markets seized up last fall. Colleges that have failed to establish a firm identity or monitor demographic shifts are likely to lose prospective students. Resistance to enhanced accountability measures has led to rising college costs and student debt. The Chronicle of Higher Education (subscription required)