When will Private Schools' bubble burst ?

[Anonymous]

Health care costs; higher teacher salaries; new FTE positions for the legions of IT specialists needed to support all the technologies; constant capital expense for IT and lassroom technology; new FTE positions for expanded college counseling and educational counseling; new FTE positions for the environmental or diversity or international programs coordinator; higher insurance premiums due to more litigation against schools; higher energy costs (costs a lot to fill up the as tank on the school bus and heat and cool those big buildings); fancy new facilities.

That's where the tuition money goes. Crazy rising costs in aggregate but any given piece seems very defensible.

[Anonymous]

Anonymous wrote:As an ncs alum from the 90s whose tuition started at 7000 and torpedo out at 10000, I am annoyed by the ridiculously lavish athletic center they built. That money invested well in the endowment would have been better served going to teachers' salaries and lower tuition.

But the Athletic center was supposedly paid for with its own Capital campaign, right. Isn't that what was said back then? So why the quintupling of tuition in 20 years ?

Lets see 30,000 more per kid is 2.4 million more in revenue a year. Have these schools operating costs gone up 2. 4 million dollars a year ? What's there annual budget ? And just how did they manage before in the 1990's ?

[Anonymous]

sorry, that's 2.4 million in tuition revenue per grade, not for entire school. Its about 24 million in tuition revenue taken in per year, 10 of millions more in Capital fund raising, and a couple million each year for annual fund. What's the take , 40 million a year in revenue ? Where is it going?

[Anonymous]

Private schools have as their back bone ( and bulk of parent pop) the upper middle class, and they are losing them.

And another thing, Mom and Dad both billing 60 hours plus a week just to pay 120K a year for elementary school tuition is bad for kids. The thing kids need most is their parent's time. These tuition hikes are causing families to not spend as much time together.

These two points are so important, and they are real. Ask teachers at even the top independent schools how the students' needs have changed over years. And the "middle" parents (who are actually very well off) are getting priced out.

[Anonymous]

Anonymous wrote:Health care costs; higher teacher salaries; new FTE positions for the legions of IT specialists needed to support all the technologies; constant capital expense for IT and lassroom technology; new FTE positions for expanded college counseling and educational counseling; new FTE positions for the environmental or diversity or international programs coordinator; higher insurance premiums due to more litigation against schools; higher energy costs (costs a lot to fill up the as tank on the school bus and heat and cool those big buildings); fancy new facilities.

That's where the tuition money goes. Crazy rising costs in aggregate but any given piece seems very defensible.

The average It salary is about 40K a year. maybe the head IT guy gets 200K/year, so the whole department costs the school maybe 500K a year. OK, say its a million. Now where did the remaining 39 million dollars in annual revenue go ? teachers salaries ? I don't think so. Even if health care costs have tripled, that still does not get you to 40 million in expenses a year ?

[Anonymous]

Anonymous wrote:

Anonymous wrote:Health care costs; higher teacher salaries; new FTE positions for the legions of IT specialists needed to support all the technologies; constant capital expense for IT and lassroom technology; new FTE positions for expanded college counseling and educational counseling; new FTE positions for the environmental or diversity or international programs coordinator; higher insurance premiums due to more litigation against schools; higher energy costs (costs a lot to fill up the as tank on the school bus and heat and cool those big buildings); fancy new facilities.

That's where the tuition money goes. Crazy rising costs in aggregate but any given piece seems very defensible.

The average It salary is about 40K a year. maybe the head IT guy gets 200K/year, so the whole department costs the school maybe 500K a year. OK, say its a million. Now where did the remaining 39 million dollars in annual revenue go ? teachers salaries ? I don't think so. Even if health care costs have tripled, that still does not get you to 40 million in expenses a year ?

Pbbt!! This is the biggest scam out there! Those head IT guys have the skills of today's average high school student . Schools are being hosed because they are too clueless to figure out technology has advanced and what they pay some schmo 200K to do, could be done by a pimple faced kid for a fraction of the cost.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Health care costs; higher teacher salaries; new FTE positions for the legions of IT specialists needed to support all the technologies; constant capital expense for IT and lassroom technology; new FTE positions for expanded college counseling and educational counseling; new FTE positions for the environmental or diversity or international programs coordinator; higher insurance premiums due to more litigation against schools; higher energy costs (costs a lot to fill up the as tank on the school bus and heat and cool those big buildings); fancy new facilities.

That's where the tuition money goes. Crazy rising costs in aggregate but any given piece seems very defensible.

The average It salary is about 40K a year. maybe the head IT guy gets 200K/year, so the whole department costs the school maybe 500K a year. OK, say its a million. Now where did the remaining 39 million dollars in annual revenue go ? teachers salaries ? I don't think so. Even if health care costs have tripled, that still does not get you to 40 million in expenses a year ?

1. You seem to be focusing on just one item out of a long list of accurate items -- and even at that, remember to multiply every FTE salary figure by about 20 to cover payroll taxes and benefits.

2. If you look at a typical private school budget, something like 65-70% of costs are related to personnel. Health care premiums is a big piece of that; moreover, talk to private school teachers who've been around for 20 years or more and they will generally be able to identify a time period where they got big pay raises (in part bc the pay was so very low).

3. Your 40 million revenue per year figure is crazy. A private school with 500 kids at 35k is $17.5 in tuition revenue BEFORE financial aid, so let's say $15 million. The best day school annual giving campaigns might raise $2 million per year, so that's high end. A very good endowment for this area is $40 million -- a prudent 4-5% draw gives you $1.6 - 2 million more. So you're talking about $18.5 to $20 million in yearly revenue, max. Capital campaigns by definition are raising for a specified capital expense like a building. Even if the capital campaign raises money for endowment, $10 million (NOT easy by any means for a day school to raise) still only gets you an additional $500,000 yearly income with a 5% draw. On the expense side, assume at least 100 full time employees (teachers, IT, admin, front office, buildings and grounds, some coaches, nurse, counselor, college counselor, learning specialist, librarians) for a school of that size.

The economics get a little better at 1000 students, but schools are not great places for economies of scale -- small class sizes mean lots of teachers. One area independent with an enrollment of about 1000 has at least 225 full-time faculty/staff.

[Anonymous]

Anonymous wrote:35k , who is paying that next year? It's now 40k( oh ,excuse me: $39,750) .35k is soooo "last year" .

http://www.maret.org/admission/affording_maret/tuition_fee_summary/index.aspx

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:35k , who is paying that next year? It's now 40k( oh ,excuse me: $39,750) .35k is soooo "last year" .

I believe you're exaggerating tuition costs by a bit. I just a few examples checked online.

Sidwell $33-34k
Holton $33-35k
NCS $35k
STA $37k

Still very expensive, but claiming that tuition is $40k seems a stretch. Whose tuition is $40k ... or even $39.75k?

I wonder why you are on the Private School forum, when seemingly you do not have a child in private yourself. Everyone who does, knows that what is published on the website is last years tuition. If you had a kid in private and looked at the mailing that came with your contract, you'd know that the figures you quoted above just went up 4-6% across the board. Why are you debating a subject you clearly have no knowledge of without a dog in the fight to boot.

you can not do math. Where did you go for school? What is 5% of 34K?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Health care costs; higher teacher salaries; new FTE positions for the legions of IT specialists needed to support all the technologies; constant capital expense for IT and lassroom technology; new FTE positions for expanded college counseling and educational counseling; new FTE positions for the environmental or diversity or international programs coordinator; higher insurance premiums due to more litigation against schools; higher energy costs (costs a lot to fill up the as tank on the school bus and heat and cool those big buildings); fancy new facilities.

That's where the tuition money goes. Crazy rising costs in aggregate but any given piece seems very defensible.

The average It salary is about 40K a year. maybe the head IT guy gets 200K/year, so the whole department costs the school maybe 500K a year. OK, say its a million. Now where did the remaining 39 million dollars in annual revenue go ? teachers salaries ? I don't think so. Even if health care costs have tripled, that still does not get you to 40 million in expenses a year ?

Pbbt!! This is the biggest scam out there! Those head IT guys have the skills of today's average high school student . Schools are being hosed because they are too clueless to figure out technology has advanced and what they pay some schmo 200K to do, could be done by a pimple faced kid for a fraction of the cost.

No, I didn't say the average IT employee makes 200K. I said the average IT employee at a DC Private probably makes about 40K, but the Dept Head of Information Technology ( you know the guy with the MS in computer science, the MBA, and 15-20 year work history with gradually increasing levels of responsibility. You know the guy responsible for running the IT dept ( he gets maybe 200K)

[Anonymous]

Something smells. I sense a bubble about to burst and last time I felt that way was 2005, 2006.

So you smelled a bubble JUST BEFORE the great price increase. ?? don't kid yourself.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:35k , who is paying that next year? It's now 40k( oh ,excuse me: $39,750) .35k is soooo "last year" .

I believe you're exaggerating tuition costs by a bit. I just a few examples checked online.

Sidwell $33-34k
Holton $33-35k
NCS $35k
STA $37k

Still very expensive, but claiming that tuition is $40k seems a stretch. Whose tuition is $40k ... or even $39.75k?

I wonder why you are on the Private School forum, when seemingly you do not have a child in private yourself. Everyone who does, knows that what is published on the website is last years tuition. If you had a kid in private and looked at the mailing that came with your contract, you'd know that the figures you quoted above just went up 4-6% across the board. Why are you debating a subject you clearly have no knowledge of without a dog in the fight to boot.

you can not do math. Where did you go for school? What is 5% of 34K?

My guess is you are just hoping to desperately make the point that is less than 6% of 37K( since you picked a low figure on both the percentage increase AND the max tuition. Why so defensive ? What's the matter, don't like where the thread is going?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Health care costs; higher teacher salaries; new FTE positions for the legions of IT specialists needed to support all the technologies; constant capital expense for IT and lassroom technology; new FTE positions for expanded college counseling and educational counseling; new FTE positions for the environmental or diversity or international programs coordinator; higher insurance premiums due to more litigation against schools; higher energy costs (costs a lot to fill up the as tank on the school bus and heat and cool those big buildings); fancy new facilities.

That's where the tuition money goes. Crazy rising costs in aggregate but any given piece seems very defensible.

The average It salary is about 40K a year. maybe the head IT guy gets 200K/year, so the whole department costs the school maybe 500K a year. OK, say its a million. Now where did the remaining 39 million dollars in annual revenue go ? teachers salaries ? I don't think so. Even if health care costs have tripled, that still does not get you to 40 million in expenses a year ?

1. You seem to be focusing on just one item out of a long list of accurate items -- and even at that, remember to multiply every FTE salary figure by about 20 to cover payroll taxes and benefits.

2. If you look at a typical private school budget, something like 65-70% of costs are related to personnel. Health care premiums is a big piece of that; moreover, talk to private school teachers who've been around for 20 years or more and they will generally be able to identify a time period where they got big pay raises (in part bc the pay was so very low).

3. Your 40 million revenue per year figure is crazy. A private school with 500 kids at 35k is $17.5 in tuition revenue BEFORE financial aid, so let's say $15 million. The best day school annual giving campaigns might raise $2 million per year, so that's high end. A very good endowment for this area is $40 million -- a prudent 4-5% draw gives you $1.6 - 2 million more. So you're talking about $18.5 to $20 million in yearly revenue, max. Capital campaigns by definition are raising for a specified capital expense like a building. Even if the capital campaign raises money for endowment, $10 million (NOT easy by any means for a day school to raise) still only gets you an additional $500,000 yearly income with a 5% draw. On the expense side, assume at least 100 full time employees (teachers, IT, admin, front office, buildings and grounds, some coaches, nurse, counselor, college counselor, learning specialist, librarians) for a school of that size.

The economics get a little better at 1000 students, but schools are not great places for economies of scale -- small class sizes mean lots of teachers. One area independent with an enrollment of about 1000 has at least 225 full-time faculty/staff.

Wrong, check the enrollment of these schools, its more like 900 + students( nearly double what you quote), and tuition is nearly 40K, not 35K ( you keep down playing that) Why are you on this thread when you obviously are not in the know. The teachers, most without certification, are paid far less than in DCPS, and many classes are co-taught with a junior teacher who is paid very little. The parents at most of these schools have to pay for their kids lunch, which is catered in or comes packed from home for christ sake. The maitenance is out sourced to the lowest bidder.

Look around, in just about every corner of our economy there is over billing , waste and deregulation allowing people to line their own pockets. This insistance that you have that Private schools are somehow immune to that trend, is ridiculously naiive.

[Anonymous]

Ok, ranting bubble PP, what school do your children attend? What's their tuition next year? Put your money where your mouth is.

[Anonymous]

Anonymous wrote:
Something smells. I sense a bubble about to burst and last time I felt that way was 2005, 2006.

So you smelled a bubble JUST BEFORE the great price increase. ?? don't kid yourself.

Are you being deliberately obtuse, read the whole thread before posting.