PROVIDENCE, R.I. [Brown University] — Based on recommendations from a committee of faculty, staff, students and senior administrators, the Corporation of Brown University approved a Fiscal Year 2025 Brown operating budget that includes $1.79 billion in revenues and $1.83 billion in expenditures.

The FY25 budget continues Brown’s focus on investing in its academic mission and the people across campus who work to fulfill that mission. Employee salaries, wages and benefits account for the largest share (43%) of expenses, with a budget of $799 million; student financial aid comprises the second-largest share (26%), with $477 million in investments.

Brown’s governing body approved the budget during its May meetings in line with the recommendations in the report of the University Resources Committee.

“With a representative body of community members deliberating thoughtfully on complex budget questions, one benefit is the firsthand understanding that participants bring on how key financial decisions can make a positive difference on the work of individuals across campus,” said Provost Francis J. Doyle III, who chairs the URC. “Our students, faculty and staff are the cornerstone of everything we accomplish in research and teaching, and a consistent focus on Brown’s people and values inspired each of our FY25 budget recommendations.”

The budget outlines targeted investments in priority areas, including continued support for the University's Operational Plan for Investing in Research; enhancements to the new Center for Career Exploration; growth in residential and online master’s degree programs; voluntary contributions to the City of Providence; and renovations to Andrews House as a new home for the Cogut Institute for the Humanities. These and other important initiatives to support students and advance research, teaching and campus life will be supported in part by $337.7 million in endowment spending, a 22% increase over FY24.

The budget’s approval follows the February 2024 establishment of the highest faculty and staff salary pool in 16 years, at 4.5%, and a 4.75% increase in tuition and fees in the face of significant inflation affecting costs. After the largest annual jump in expenses at U.S. colleges and universities since 2001 in the prior fiscal year, a 4.0% climb in expenses at U.S. colleges and universities in the most recent full fiscal year continued a trend in which the impact of inflation has translated into higher operating costs for Brown and other schools.

The 4.75% increase in tuition and fees follows a comparable increase in FY24 after two years of increases that were considerably lower than most of Brown’s peer institutions. To sustain a commitment to meeting 100% of every undergraduate student’s financial need, the University’s FY25 budget includes a 7% increase in financial aid for undergraduates, as well as a total student aid budget of $477 million to support undergraduate, master’s, Ph.D. and medical students.

The continued expansion of Brown’s undergraduate financial aid budget will sustain and expand on recent increases in financial support for students. With new measures including additional scholarships for moderate-income undergraduates, 52% of Brown’s most recent incoming class received aid, and the average family financial responsibility for those students was $27,580. The expanded budget for FY25 will be critical in Brown’s plan to launch need-blind admissions for international students beginning with the Class of 2029.

“Our goal is to ensure that every undergraduate student with financial need can benefit from scholarships and aid that enables them to come to Brown regardless of their financial background,” Doyle said. “A strong financial aid program not only opens doors for talented students, it enriches our academic community with the people and perspectives that makes our education and research stronger across the board.”

Brown’s budget also provides $232.9 million in student aid and support for graduate students, continuing its track record of new investments in aid for Ph.D., master’s and medical students, which range from fellowships and stipends to support for students who are parents.

Brown’s financial outlook

With $1.79 billion in revenues and $1.83 billion in expenditures, the approved FY25 budget projects an operating deficit of $46 million for FY25, which is 3% of total revenue. One priority for the University in the coming years will be to limit annual deficits, even while continuing to invest in important priorities.

In a letter accompanying the URC’s recommended budget, Doyle noted that Brown has experienced tremendous growth in its education and research over the last decade, fueled by previous years of high investment returns, successful fundraising, additional students, and access to credit at low interest rates in a low-inflation environment. That fiscal environment enabled the University to continue to invest in priorities in research, teaching, student support, campus development and more.

Projects have included cutting-edge new facilities — from new life sciences laboratories and athletics projects underway to the completion of the Lindemann Performing Arts Center and two new residence hall projects, to the renovation of Churchill House for Africana Studies and Rites and Reason Theatre, and Stonewall House for the LGBTQ Center, to the purchase of River House for graduate student housing and a portion of South Street Landing for collaborative office space. They also include important financial aid initiatives, new research centers, growth in academic programs, additional faculty hires and expanded partnerships beyond the Brown campus.

But the University is now operating in a different financial climate, with multiple factors creating considerable financial pressure. Among those are little projected growth in undergraduate tuition, with no plans at Brown for further expansion of the undergraduate student body. Endowment forecasts are anticipating more modest investment returns than in recent record-setting years, which means the endowment’s annual contribution to the operating budget will decline relative to past funding. University leaders are also focused on keeping pace with needs for wage growth for employees, given the impact of inflation on living costs, as well as planning for increases in the cost of new debt and inflation that is expected to ease slightly, but remain higher than the low inflation that persisted for much of the last decade.

“These factors, combined, indicate that careful financial management will be essential…,” Doyle wrote, particularly in avoiding sustained annual budget deficits. “Over the course of the summer and into the coming academic year, in consultation with the URC and other campus partners, we will develop achievable targets and plans to bring our budget into balance while continuing to make the strategic investments required to elevate Brown’s impact as a leading research university.”

In the development of the FY25 budget, the URC recommended multiple measures to keep the operating deficit as low as possible. Those include a temporary increase in the endowment payout, from 4.8% to 5.5% of the endowment’s 12-quarter average fair value, to provide more revenue to offset costs of shorter-term strategic investments to support key academic priorities.

The budget development process also asked unit leaders across campus to limit new spending requests and required the development of a second budget scenario with a more constrained spending target, a best practice in financial planning that will become a regular part of Brown’s budget process. When initial funding requests from across campus exceeded available resources by $140 million (roughly 8% of the overall operating budget), those were prioritized based on institutional goals, strategic priorities and a commitment to supporting the faculty, staff and students who enable the University to achieve its mission. 

Developing the University’s operating budget is always a demanding task, Doyle said, given the need to carefully balance spending in support of Brown’s people and priorities while also ensuring long-term fiscal responsibility.

“I am grateful to all of the participants in this year’s process — the faculty, staff and students serving on the URC, the members of our community who spent months developing their funding requests, and the academic and administrative leaders who supported the process,” he wrote in recommending the budget. “The community’s dedication to Brown was key to enabling the URC’s important work of shaping the University’s financial future.”

Brown’s Fiscal Year 2025 begins on July 1, 2024. The full URC report is available on the website of Brown’s Office of the Provost.

Brown’s Fiscal Year 2025 Base Operating Budget

Consolidated Budget Revenue — Key Components

• Tuition and fees: $753.5 million
• Endowment: $337.7 million
• Sponsored research: $300.9 million
• Annual Fund and spendable gifts: $112.8 million
• Auxiliary and miscellaneous: $287.3 million

Consolidated Budget Expenditures — Key Components

• Faculty compensation: $312.9 million
• Staff compensation: $467.2 million
• Student compensation: $18.8 million
• Undergraduate student aid: $216.7 million
• Graduate student aid: $232.9 million
• Other student aid: $27.4 million
• General operating and subcontracts: $380.9 million
• Property, debt and capital: $116.2 million
• Internal services, transfers and other: $65.7 million

Budget by Division

The University’s consolidated budget comprises six main budget divisions, detailed here with total revenue budgets for FY25:

• Education & General and Auxiliary Enterprises: $1.3 billion
• Biology and Medicine: $255 million
• Public Health: $139 million
• Engineering: $31 million
• Pre-College Programs: $45 million
• Professional Studies: $19 million

Endowment

Brown’s endowment payout is governed by a disciplined policy that balances the need for current income with the important goal of preserving the endowment’s value to provide funding for future generations of students.

For FY25, Brown’s endowment will provide $337.7 million of revenue to the operating budget, a $59.9 million increase over FY24. An endowment draw (or payout) of 5.5% will help to cover the costs of shorter-term strategic investments while remaining within the policy recommendation of an amount in the range of 4.5 to 5.5% of the endowment’s 12-quarter average fair value. This year’s payout will also enable support for campus activities ranging from undergraduate scholarships and professorships to graduate student fellowships, research laboratories, library acquisitions, academic programs, student life initiatives and varsity athletics.

Tuition and Fees

To enable students to anticipate the following year’s cost of attendance, the Brown Corporation approves tuition and fees in February each year. Undergraduate tuition and fees for 2024-24, as approved in February 2024, are:

• Tuition: $68,612
• Standard room rate: $9,940
• Standard board: $7,504
• Health services fee: $1,166
• Undergraduate student resources fee: $1,044
• Student activities fee: $400
• Student recreation fee: $90

TOTAL UNDERGRADUATE: $88,756

Graduate tuition for most doctoral and on-campus master’s degree programs will increase by 4.5% to $8,576 per course. Given a shift in 2018 to market-based pricing for some master’s degrees, approximately a dozen University master’s programs have tuition rates that vary from the standard — for most, tuition for 2024-25 will increase by 4%, with cost for a small number of programs remaining the same as for 2023-24.

Medical school tuition will increase by 2.75% to $71,192.