A Message about Tuition and the Value of a Berklee Education

Published December 12, 2014.

Dear members of the Berklee community,

As you know, Berklee is considered by many to be one of the top institutes of contemporary music in the world. Maintaining and, indeed, building on our leadership position is one of our highest priorities. However, we are also quite mindful of the high cost of a college education.  Berklee president Roger H. Brown has identified affordability as a top strategic initiative and his administration is diligently pursuing numerous initiatives to make the cost of a Berklee education as affordable as possible. These include lower increases to tuition and room and board and higher scholarship support.

Recently, I had the opportunity to meet with the Student Government Association (SGA) executive team to discuss Berklee’s finances and tuition. I thank the students involved for their leadership and involvement in making Berklee the best it can be. It was an excellent meeting and we all agreed that it might be helpful to share the presentation (view the slides) from that meeting as well as the following summary of the meeting’s discussion.

SGA December 2014 Executive Meeting Summary

At the outset of president Brown’s administration, after receiving input from students, parents, faculty, staff, alumni, and other key stakeholders, a number of strategic investments were identified to fulfill Berklee’s mission to become the leading institution of contemporary music in the world. These investments have been costly, but they are paying off, as evidenced by our growing number of applications, the high quality of our faculty and students, and by our higher graduation rates. The value of a Berklee education has risen significantly as a result and Berklee is now widely considered to be one of the best music colleges in the world.

There is no question that our tuition has risen in the process. However, when compared to the other high-quality music schools that our students typically consider, our tuition is not only below the average, but many thousands of dollars below some of the schools at the high end of the range (see slide 4 in the presentation). We think this makes for a pretty compelling value proposition: one of the best music degrees available at below-average cost.

Still, we understand that not every student who is admitted to Berklee can afford to attend, so making Berklee as affordable as possible to as many as possible is an ongoing challenge and priority. To this end, Berklee recently launched its online degree programs, which are significantly less expensive than the on-campus degree programs. While online students do not enjoy all the benefits and facilities that come with the on-campus programs, they still receive a high-quality education. We intend to expand the number of online degree programs over time.  Furthermore, the administration is looking at ways to integrate more affordable online options into the on-campus curriculum. We are also exploring the expansion of transfer credits from other colleges and universities.  Finally, the administration is focused on increasing scholarship support. Growth in scholarships and college work-study funds has been very rapid over the past five-plus years. In fact, we expect scholarship support to exceed $40 million for the first time this year. Expanding scholarship support is also a key focus of our new $100 million capital campaign, Soundbreaking, which has already attracted more than $50 million in donor support. Investing in our students will remain a high priority going forward.

Maintaining our leadership position also requires ongoing investment in faculty, facilities, and technology, and our long-range investment program is on track. Our continued investments in faculty – with 16 new faculty members added in 2014 – and in curriculum ensure that the quality of a Berklee education remains of the highest caliber. Three years ago, we concluded a comprehensive review of our curriculum, which resulted in, among other actions: mandatory 50-minute private lessons for all entering students with the option of continuing the longer lesson in the second semester; the introduction of new minors programs; requiring entering students to enroll in a first-semester seminar (Artistry, Creativity, and Inquiry); the introduction of a professional development seminar taken in the sixth semester; and the introduction of a number of highly regarded institutes, including the Berklee Global Jazz Institute, the American Roots Music Institute, the Institute for Creative Entrepreneurship, and most recently, the Berklee Popular Music Institute.

We have also made major investments in our facilities. Since 2007, we have invested more than $185 million in the acquisition or improvement of our facilities, a number of which are featured in the presentation. It is important to note that our major facility-related projects are typically funded by long-term debt so that the costs of these projects are spread over many generations of Berklee students.

In thinking about how tuition dollars are spent each year, it is first important to recognize that Berklee is a private, non-profit institution; every dollar we receive is invested in the college. In addition, while tuition is by far the largest source of the college’s revenues, it is not the only source. With Berklee’s growing stature, gifts and donations have become an important and growing source of support for the college. The aforementioned capital campaign, Soundbreaking, is on track to meet its $100 million goal. These funds are used to support scholarships, operations, facilities, and the like. Similarly, our endowment supports our operating budget, providing more than $14 million in support this year. Both of these sources of income help to offset tuition increases.

Our operating costs (see slide 6 in the presentation) for 2014 break down as follows: direct scholarship support to students (16%); instruction and academic support (47%), which covers the cost of faculty as well as ancillary support such as work-study, lab monitors, classroom supplies, and staff support; student services (6%) such as admissions, financial aid, the registrar, etc.; and costs primarily paid for by fees from those students who use Berklee room and board (14%). Together, these add up to 83 percent of our operating budget. The remaining 17 percent is best described as the infrastructure that supports the college: technology, security, facilities, alumni relations, fundraising, finance, human resources, etc.

These costs are typical of higher education institutions and are closely monitored by our senior management and board of trustees; our outside auditors, of course, also review them. (Berklee’s financial information is publicly available; see slide 8 for web access information.) Beyond monitoring costs, our staff members have been actively engaged in finding ways to contain or reduce costs at Berklee. A number of significant cost-savings initiatives to improve efficiency have been implemented in the past few years and more new initiatives have been identified for future implementation.

These efforts will help us limit future tuition increases. In fact, while we do not anticipate actual reductions in our tuition cost in the near term, beginning with the fall of 2014, any tuition increases have been kept closer to the rate of inflation. This will help us to remain competitive from a cost standpoint while keeping us on track to be the leading institute of contemporary music in the world.

We hope that you find this letter and the presentation materials (view the slides) useful, and we welcome any thoughts or questions you might have.

Richard M. Hisey
Chief Financial Officer
Senior Vice President for Administration and Finance
Berklee College of Music