Boston College to cut spending to bolster financial aid

By Peter Schworm, Globe Staff

Boston College President Rev. William P. Leahy called today for a university-wide 2 percent spending cut to bolster the institution's financial aid budget in anticipation of increased requests for tuition assistance.

"Need for financial aid will increase as some BC families struggle with lost jobs and diminished home values," Leahy said in a letter to the college community. "It will be critical to have additional funds available."

The cut will total $2.5 million. The savings will be placed in a reserve account to assist students next semester and the following academic year.

Leahy said the financial crisis and steep market slides had hurt the college's endowment, which it relies on for about 10 percent of its yearly budget. Last month, university officials said the endowment totaled $1.7 billion.

"While Boston College depends on investment income significantly less than many of our peers, the decline in our endowment certainly affects our revenue projections and must be compensated for in our budget process," Leahy wrote.

Since the economic downturn, colleges across the country, including Harvard, MIT, Dartmouth, and Boston University, have announced cost-cutting measures to offset endowment losses.

Yesterday, Northeastern University confirmed it was shelving plans for a multi-million dollar dormitory, and MIT this week announced it will seek to trim its budget by 10 percent to 15 percent in the next two or three years.

College officials are expecting a sharp increase in financial aid requests next year because of increasing unemployment and declining home values and investment funds, and many education specialists predict that more students will apply to less-expensive public colleges.

Leahy said BC remained committed to making admissions decisions without regard to families' ability to pay, and to meeting the financial need of accepted students. Boston College costs close to $50,000, but 70 percent of undergraduates receive financial aid, with an average award of about $28,000.

This year, BC awarded $114 million in financial aid, $75 million to undergraduates.

Leahy said university officials would make specific decisions about tuition, salaries, hiring, and construction plans in the next six weeks. The college's sweeping expansion plan, including new dormitories and athletic fields on its Brighton campus, is now under city review.

Last month, Boston College launched a $1.5 billion fund-raising campaign, the largest in its history. The college has raised $535 million so far, including $15 million in donations in the past month.

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