It was the type of demonstration last seen at George Washington University during the days of the Vietnam war. Two hundred students marched on the administration building, chanted slogans, demanded a meeting with the university president, and threatened to take over the building.
But the noontime demonstration last week was not a peace rally. The students were protesting a proposed 25.5 percent increase in GW undergraduate tuition -- an increase university officials say is needed to cover a deficit in GW's nonmedical operating budget, caused in part by an unexpected 5 percent drop in enrollment. any students say they cannot afford the proposed tuition increase, which comes on the heels of a 19 percent tuition increase this year and would raise the tab for a year's undergraduate education to $6,150. Although that price is still lower than the cost at many equivalent schools, some students say they will transfer out of GW rather than pay the higher rate. This raises the specter of another sharp drop in enrollment that will create a deficit that in turn will have to be covered by still-higher tuition -- a vicious cycle.
"I'm going to transfer," GW freshman Eric Edenfield said last week as he demonstrated against the tuition increase in front of the administration building, Rice Hall. "This is no longer the cheap alternative it used to be."
The Rice Hall demonstration is not the only way students have struck back at the planned tuition hike, which GW trustees will vote on in January. The students have also lobbied alumni and trustees, held forums to question university administrators about the increase and begun work on an alternate university budget.
They've even undertaken a campaign to send pennies to university President Lloyd H. Elliott to show their dissatisfaction with the planned increase. Depending on whose estimate you listen to, Elliott received between 1,000 and 2,000 pennies; the university president says he'll probably adopt a student suggestion and hold a contest to guess the number of pennies sent in. Proceeds would go to student aid.
Such controversy over finances is nothing new at the 16,500-student university. There have been tuition protests before, and GW has repeatedly come under fire for its extensive real estate dealings. The university, critics say, seems to be operated more like a business than an institution of higher education.
But GW is a business -- a $253 million business last year -- whose 7,200 employes make it one of the largest nongovernment employers in the District. And with enrollment dropping, federal funds stagnant and corporate and private benefactors hard to find, GW officials are being forced to resort to sophisticated financing, management and marketing techniques to keep the university financially healthy. These are tough times for private universities, GW officials say, with increasing challenges to institutions' abilities to stay financially strong without compromising educational standards.
"The small four-year liberal-arts colleges are going to be the hardest-hit," says William D. Johnson, GW's associate provost and director of planning and budgeting. "Institutions like GW are going to have to do some creative management, whatever that means. It isn't going to be easy.
"We've done all the creative accounting we can do," he adds. "Now we've got to do some creative management." t GW, that has meant renewed commitment to the university's controversial real estate investments, which substitute for an endowment, the unpopular tuition increase and forays into new areas of financing, most notably tax-exempt revenue bonds backed by the District of Columbia government. GW in the past year has raised a total of $55 million from two revenue bond issues, using the funds for buildings and other capital projects. University officials envision another bond issue in the next few months to raise funds for financial aid to help students with the increase in tuition.
"In my opinion, there aren't any other sources, either for us or for other private institutions," Elliott says. "Therefore, to be able to recruit new students and to retain those once enrolled, we must, I think, in the immediate years ahead, fund more student aid, both in the university's own resources and through such things as borrowing under the D.C. tax-exempt bond program."
GW, mind you, is in no danger of financial collapse. When figures from the university medical center are included, GW had one of its best years ever in 1981, university officials say. But in the complex world of institutional accounting, they say, each sector of GW must pay for itself. And the operating budget for the nonmedical parts of the university alone showed a $3.5 million deficit last year, smaller deficits in each of the three previous years, and will likely show a $1.7 million shortfall in the current school year.
The way some students see it, though, the proposed tuition increase is a sign of panic, of a university administration suddenly victimized by its own misjudgment.
"Somebody made a $3.5 million mistake, and I think they're passing the mistake on to the students," says Fran Callamari, a junior. Says junior Marc Wurzel, one of the leaders of the student protest against the tuition hike, "When a businessman makes some grievous errors, whether it's in enrollment, costs, or a piled-up deficit, it's just hard to understand why."
University officials say the deficits are the result of several factors -- including mistakes here and there. Perhaps one of the most important factors is that GW tuition increases during much of the past decade failed to track inflation. Even as students raised protests over the $100-a-year tuition increases of the mid-'70s, GW was falling farther and farther behind the increase in costs, officials say. In the years from 1977 to 1981, they estimate, the university lost $17 million by not pegging tuition increases to inflation.
But the small increases were fine as long as enrollment continued to rise. Like any other business, the university made up the difference in volume. But when enrollment began dropping, the deficits started to appear. The enrollment decline was basically a matter of demographics: the number of college-age men and women is declining as the baby boom generation tails off. In addition, GW is facing increased competition from less-expensive, improving state colleges like the University of Maryland and George Mason University, and fears of cutbacks in federal student aid are scaring some students away from expensive private colleges, educators say.
Whatever the reason, 800 students GW expected to register this fall didn't show up -- putting a crimp in GW's financial plans. "Either they show up in September or we're in trouble for the rest of the year," says vice president and treasurer Charles E. Diehl. "We can't have a Christmas sale on January enrollments."
At first, GW officials feared that the enrollment drop would cause a shortfall of several million dollars this school year. A cost-cutting program brought the projected deficit for the year down to $1.7 million. GW officials say they can't cut costs any further, because of the fixed costs of many college programs in terms of facilities and tenured faculty, without laying off professors and other employes. "Cutting expenses often means cutting educational quality," Elliott says. So the latest deficit will be lumped together with those from previous years, and tuition will be raised to cover the difference.
As if the announced plans for tuition increases weren't enough of a public relations problem for the university administration, students are worried about increases farther down the road, in light of recommendations made by an outside consultant to the university.
The consultant suggested that GW could improve its image by upgrading its educational standards and charging the highest tuition in the Washington area; even with the planned increase next year, its tuition will likely rank behind Georgetown and American. "This recommendation does not include reference to whether the university needs the money," the report said. "For purposes of assuring quality, that is almost irrelevant." In light of the current controversy, GW officials admit that it would be impolitic to heed the recommendation in the near future.
Even before they announced plans to raise tuition, GW officials were expecting a further 3.6 percent drop in enrollment for the 1983-'84 school year. Now nobody knows what to expect.
"There just aren't any what I consider reliable guidelines or criteria by which to make such projections," Elliott says. Johnson says of the earlier estimate: "There are those who think that's unreasonably optimistic in terms of this hellishly high increase." And a survey of 227 students by the school newspaper, the Hatchet, found 22.5 percent planning to transfer out of the school; student leaders believe that number is high, however.
But school officials worry about a vicious cycle of students being driven away because of high tuition, in turn pushing the price higher. And Elliott and other GW administrators don't want to lower admissions standards to make up the difference. "Each incoming class in the last five years has been better than the previous one, and we would obviously like to see that pattern continue," the president said.
To help students cope with the increase, GW officials plan to add to student aid funds. In addition to working on another revenue bond issue to fund scholarships, the university has budgeted $500,000 to help students in need pay next year's tuition. Johnson says the university would rather subsidize a student's education than lose the student -- and partial tuition.
The university administration also says it announced the planned increase unusually early in the school year to give students a chance to make plans to adjust to the higher fees. Some students, however, charge that GW is offering itself as a stalking horse for other colleges, who will be watching to see if GW can push through an increase of this size without causing a wholesale exodus of the student body.
GW's 1982-'83 tuition of $4,900 compares to $6,830 at Georgetown; $6,200 at American; $5,750 at Catholic; $5,400 at Trinity, and $3,303 for a nonresident at the University of Maryland. Outside the Washington area, Columbia University's tuition for this academic year was $7,050; for Washington University in St. Louis, $7,125; for Boston University, $7,175; for Carnegie-Mellon Institute in Pittsburgh, $6,300, and for Case Western Reserve University in Cleveland, $6,200.
Some students are dissatisfied with the university's justifications for the tuition increase, saying either that they've seen no increase in educational quality to justify the increase or that the university wants the money to pay for past mistakes or future programs that won't benefit the current student body.
"The stuff that they're building now, we'll never see," says Tom Mannion, a junior who is president of the George Washungton University Student Association (GWUSA).
But Mannion, who says many students have been too apathetic to join the protests organized by GWUSA, is trying to work with the administration to hold down the tuition increase. Last week, GWUSA offered an alternative university budget, which administration officials say they will consider, so that next fall's tuition increase can be shaved by about $75. It also proposed that students be allowed to pay tuition a year in advance in return for a promise that they would be exempt from any rate hike.
The association said the university should do more to sell itself to new students and potential corporate and foundation benefactors. "I'm sorry we didn't come up with anything to allow more drastic cuts" in the proposed tuition, said Jerry Kampler, a junior. "But we're working with out hands tied."
Mannion believes the trustees might not rubber-stamp the administration's tuition proposal if presented with an alternative. But "reality dictates there will be an increase," Wurzel concedes.
University officials say they are sympathetic to the students' complaints.
"Tuition is viewed like taxes. No one wants to pay such charges," Elliott says. "Unfortunately, no private institution and few public institutions have found a way to do otherwise."