American University releases budget plan for fiscal years 2023 and 2024
Plan includes focuses on increased financial aid, compensation and new faculty and staff hires
The American University Board of Trustees has approved its budget for fiscal years 2023-2024, Board of Trustees Chair Marc Duber announced in a Wednesday email to the community.
According to the email, the University plans to have a $1.74 billion budget over the next two years, setting aside $850 million for the fiscal year 2023 and $894 million for the fiscal year 2024. The updated budget plan comes after the University’s decision in February to increase tuition, room and board and makes key investments in financial aid and worker compensation while increasing the number of new hires for faculty and staff. According to the email, the fiscal year 2023 budget includes the largest compensation pool since 2005.
“We're excited about the focus of the 23-24 budget because our focus is on people,” Chief Financial Officer Bronté Burleigh-Jones said during a student media briefing Tuesday.
The University’s Chief Communications Officer Matthew Bennett said in the briefing that the budget comprises several categories.
The largest expenditure categories within the University’s budget plan are financial aid and compensation. Burleigh-Jones said financial aid will increase by $32 million over the next two fiscal years after the University raised tuition by 5 percent.
Faculty and staff are set to see compensation increases thanks to a 4 percent salary pool. A 2 percent increase will be given to staff and faculty who are not a part of the collective bargaining table for the unionization effort, which is required by federal law. An additional 2 percent is set aside for staff and faculty that are eligible for performance increases.
Additionally, the University is investing in a “salary adjustment pool” to support term faculty. Over the course of two years, the salary floor for term faculty was on the lower end of the pay spectrum and there was a narrow gap between the floors for term faculty with the highest degree possible in their fields, such as a PhD. The pool will also address disparities in compensation for term faculty who make less than $100,000 a year and have more than five years of service at AU.
Bennett said the University is investing money into faculty positions that the different schools on campus have identified as necessary.
In the email, it is mentioned that the University’s budget plan includes “considerable investments in terms of students thriving, faculty research, experiential learning, lifelong learning, and the instructional needs in our academic units, in addition to DEI, fundraising, and Title IX.”
Part of the budget is also set aside for “equity and retention,” which is a multi-year market-based strategy to address internal salaries.
The budget seeks to account for the $100 million in losses the University has faced due to the coronavirus pandemic.
Bennett said in the briefing that the losses came from the University’s 10 percent tuition discount while classes were virtual, a lack of students in residence halls and the costs of maintaining COVID-19 testing sites.
The full budget report will be released and available within the next few weeks.
Correction: The compensation for faculty and staff is from a 4 percent salary pool, not 4 percent of the total budget.