Endowment Guide

Luther ranks below ELCA mean for dollars per student

Date 11/21/2002 12:00 AM | Topic: News

At the Nov. 8-9 meeting of the Board of Regents, President Rick Torgerson reported that Luther's endowment per FTE student is below the mean amount for ELCA colleges with greater than 2000 students.

The endowment per FTE student is a measure that relates the total size of Luther's endowment to the size of the student body. Luther's endowment per FTE student was reported at $23,025 per year, which falls well below the $39,169 mean for ELCA colleges with greater than 2000 students.

This means that Luther students have an endowment per FTE student that is $16,144 or 42.3% below the mean endowment per FTE student of other ELCA insitutions.

According to the Report on the Luther College Board of Regents Meeting distributed to faculty, Torgerson reported steady endowment growth from 1997-2000, but due to a drop in the market and rising expenses, the figure would be a key indicator for Luther to watch.

In his quarterly report to the Board of Regents, Torgerson said the implications of the low figure to be, "a measure of financial flexibility that mitigates pressure to increase student costs each year."

In the same report, Torgerson set a goal of 9.5% growth per year and an aspiration to reach the top quartile of ELCA colleges.

An increase of 27.5% in health care costs for the college was also reported at the meeting by Diane Tacke, vice president for finance and administration. Tacke reported that the five year history of Luther shows an average increase of 15.37% per year.

Health care costs increased from $2,225,775 during the 2000-2001 school year to $2,838,344 during the 2001-2002 school year, with a single year increase of $612,569.

The Resources and Facilities Committee report stated, "Although Luther has taken considerable steps to transfer more of the cost to employees and to manage employee use of health care through incentives, it was agreed that more must be done. There was considerable support for shifting more of the future risk of rising health care costs to employees, even if it requires an offsetting increase in salaries."

According to the faculty report, Board of Regents Chair David Larson noted that "health care costs have a large impact on the overall viability of the college."

Larson went on to say that the Executive Committee of the Board had requested the president to conduct a study on health care and "develop a strategy to transform the college's compensation and employee benefits plan, with implementation to begin in fiscal year 2003-2004."

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Barry Campbell
News editor

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