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Pitfalls of Tuition Dependence

Pitfalls of Tuition Dependence

In most Christian schools, a dangerous condition exists. Because we intentionally maintain low teacher-student ratios, the ministry is "labor intensive" but not "revenue intensive!"

tuitionOur extensive work with the pilot schools in our program has revealed that the condition of tuition dependence exists universally in Christian education. On average, the pilot schools in our program generate more than 86% of the schools' total income through tuition and fees. While most school ministries are supported by some limited fundraising efforts, a modest church contribution, and other miscellaneous income sources, the conclusion is undeniable that tuition provides the crucial measure of support for the ongoing operations of the ministry.

personnelNow consider where those dollars are going. Right at 90% of our pilot schools' operating budgets are devoted to paying personnel expenses!

What happens to the budget if the school suffers a 10% decrease in enrollment?

The inevitable conclusion is that cut-backs must be made, and most likely those cut-backs will take the form of lay-offs of school staff where the bulk of the money is being spent. This leads to a dangerous "death spiral" as the school's quality suffers, teacher-student ratios begin to climb, and ultimately parents withdraw students and seek better alternatives.

Unfortunately, when the school is tuition-dependent, simply growing the student body does not alleviate the financial pressures faced by the administration. In order to keep teacher-student ratios low, additional staff must be added for each group of additional students. The addition of new students merely exacerbates the problems!

The good news is, there is a solution to the problem of tuition dependency! Through Eternal Vision's endowment building process, Christian schools can break the cycle through the development of an income stream that is entirely independent of tuition dollars.

Once the endowment is fully funded, staff compensation will be nearly doubled in most cases and completely removed from the budget! That means 100% of the school's current tuition income will be available for spending on everything else! Imagine the freedom for the administration to improve quality and address program and facility needs!