The last decade has seen a major shift in the treatment of 403(b) retirement plans, and many 403(b) plans now look and feel closer to 401(k) plans. Most of these changes are positive, especially from the viewpoint of the employee/investor.  But while the Department of Labor’s (DOL’s) introduction of  Employee Retirement Income Security Act (ERISA) to 403(b) opened plans to a variety of investment vehicles, it also created additional disclosure requirements and responsibilities for plan fiduciaries.

A recent article in NACUBO’s Business Officer magazine closely examines the undercurrents of these changes, summarizing five major trends to look for in future changes:  Read more... (295 words, estimated 1:11 mins reading time)

Michelin’s recent announcement that their newest plant will be located in South Carolina contradicts the predictions from many analysts that U.S. manufacturing can’t compete with cheaper production from places like China or Mexico. As the Wall Street Journal reports, relationships between factories and schools are helping reeducate employees to fill demand for newer production jobs.

The area’s manufacturers have built a symbiosis between factory and school. Walking through GE’s gas-turbine plane some months back, I asked the factory manager how she coped with the nation’s shortage of engineers. “We don’t have a shortage,” she said. She gets plenty from Clemson University, Greenville Technical College and other regional schools.  Read more... (193 words, estimated 46 secs reading time)

Fundraising figures in 2011 were better than average for nearly all colleges and universities, but the discrepancy between the top 20 wealthiest universities and all others continued to widen drastically. As the San Francisco Chronicle reports, the top 25 wealthiest universities accounted for 86 percent of all $30.3 billion in 2011 fundraising.

Last year’s fundraising total nationally remains $1.3 billion below the 2008 peak of $31.6 billion, and while some non-elite schools had good years, many were still struggling as the economy sputtered last year. Roughly two-thirds outside the Top 20 saw fundraising rise by less than the 8.2 percent national average.

 Read more... (156 words, estimated 37 secs reading time)

Last week, the Obama administration released its Fiscal Year 2013 budget request, outlining details in a speech in Annandale, Virginia. As the National Association of College and University Business Officers (NACUBO) reports, the spending details outline a number of higher education initiatives focusing chiefly on job training, increased college access, affordability and completion. To accomplish these goals, the budget makes alterations to student aid, higher education funding, research budgeting and taxation.

FY13 Student Aid Proposals:

• The president is seeking a $5,635 maximum Pell Grant award (for academic year 2013-2014), an increase from the current $5,550.
• The administration is proposing to tie the distribution of federal campus-based aid—Supplemental Opportunity Grants (SEOG), Federal Work-Study (FWS), and Perkins Loans—to three principles: setting responsible tuition policy; providing good value to students; and serving low-income students.

 Read more... (277 words, 1 image, estimated 1:06 mins reading time)

Fiscal year 2011 was a good one for college endowments, with an average return of 19.2 percent. In a study by the National Association of College and University Business Officers (NACUBO) of 823 U.S. colleges and universities, the double-digit growth built even further on 2010′s 11.9 percent jump.

However, as the Chicago Tribune reports, endowment funds, while up, are still not fully recovered to 2008 levels.

Colleges typically spend around 5 percent of their endowment annually to boost spending on things like faculty salaries, student financial aid and other operating costs. Most colleges depend largely on tuition revenue and government support, but at elite universities, endowment spending accounts for a substantial part of the budget; at Harvard, for instance, roughly one-third of the operating budget comes from income generated by the university’s endowment. 

 Read more... (193 words, 1 image, estimated 46 secs reading time)

A recent study, “The American Freshman: National Norms Fall 2011,” found that entering college freshman were less likely to attend their first college of choice last Fall than at any time since 1974. While competition for top schools is on the rise, so is the inability of students to pay top dollar even if they are admitted. As the New York Times reports, nearly one in every 5 students accepted to their first-choice school do not attend because they could not secure adequate financial aid.

“When you look at those students, the primary thing that jumps out is cost and financial aid,” John H. Pryor, director of the Cooperative Institutional Research Program at the University of California, Los Angeles said in an interview. “These students who were accepted and are not attending are much more likely to say they are not going because they did not get the financial aid they wanted.”

 Read more... (204 words, estimated 49 secs reading time)

The IRS recently announced the launch of the Exempt Organizations Select Check, an online search tool which provides information regarding the federal tax status and filings of exempt organizations. Select Check condenses information previously housed on three different sites to more efficiently search for an organization’s:

• Eligibility to receive tax-deductible charitable contributions (Publication 78 data),
• Tax-exempt status revocation due to lapses in Form 990 filing in three consecutive years (Auto-Revocation List), and
• Annual Form 990-N filings (e-Postcard).

Starting this month, Select Check will be updated monthly for most information, and more often for 990-N filings. For more information and search tips, visit Exempt Organizations Select Check.  Read more... (105 words, 1 image, estimated 25 secs reading time)

A recent study by Fidelity Investments found younger higher-education employees investment strategies, where they exist, don’t necessarily align with their needs. As Market Watch reports, fewer than 25% of respondents ages 21-32 have a formal investment plan, and those that do are very conservative in their choices.

Nearly half (49%) of the higher education workers surveyed described themselves as “conservative” investors when it comes to retirement, regardless of age. In fact, younger employees were found to be using the same asset allocation strategies as their older counterparts, with Gen Y using a similar asset mix (50% stock, 35% bond/annuity and 15% cash) as Gen X and Baby Boomers.  Read more... (205 words, estimated 49 secs reading time)

Colleges with certain specialized majors have had recent success luring out-of-state students with tuition discounts. If a student is looking for a particular focus, such as an MBA with a logistics concentration, and cannot find that program within state borders, many states have programs to offer that student their own in-state tuition cost to attend an out-of-state university. As BusinessWeek reports, these exchange programs have become more popular as more students shop for their educations by price tag.  Read more... (254 words, 1 image, estimated 1:01 mins reading time)

While double-digit gains in university endowments have governments reexamining tax measures, the Funds’ managers argue that they are not yet recovered in an uncertain market. According to the Chronicle of Higher Education, the National Association of College and University Business Officers (NACUBO) and the Commonfund Institute show endowments at 86 percent of their value at the same time in 2007.

“We’re still nowhere near where we need to be to recoup the losses from the downturn,” said William F. Jarvis, managing director of the Commonfund Institute.  Read more... (193 words, estimated 46 secs reading time)