What Do Academic Programs Cost?
How to Conduct a Cost Study to Inform the Administration
and Compare Costs Across Disciplines
AIR 50 TH ANNUAL FORUM
JUNE 2009
TERRI MANNING,ED.D AND LORI ALEXANDER
CENTRAL PIEDMONT COMMUNITY COLLEGE
Background
 The College had 28,394 curriculum students in the
2008-09 academic year.
 The College offers 197 associate degrees, certificates
and diplomas in 47 program areas.
 The College wanted to understand which programs
were earning more or less than the FTE amount
being paid by the state and which programs were
breaking even.
 The College produces graduates in many high cost
fields such as healthcare and the students are hired
before they graduate (great community need).
Reasons for the Study
 To prioritize our allocated budget resources
during tough economic times.
 Help make the case for additional money from
external sources (foundation, stimulus package,
scholarships, local businesses and grants).
 Help evaluate the performance of
our programs (Road Map and
Program Review processes).
 Assist us with our strategic
program planning.
Not a Function of the Study
 CPCC does not make decisions to close
programs based on the cost!
 The only reasons programs are closed are
for:



Changes at the system level
Lack of interest/low enrollment (consistent over
multiple terms)
Program consolidation
Factors Utilized in the Study
 Actual budget dollars expended by divisions in FY07




08 (data from Budgets).
All FTE students enrolled by pre-fix and course for
Fall 2007 and Spring 2008 (data from FTE Reports).
Division administrative costs were pro-rated across
programs based on a % of FTE’s.
A calculation resulting in credit hour generated.
A cost per credit hour generated was created to
compare programs over a three-year period.
The CPCC cost per credit hour was also compared to
the State reimbursement rate to determine ROI.
How it Was Actually Done
 In the 2007-8 academic year, CPCC was paid $4,729
per FTE. $3,318 was allocated for
instruction/instructional support and $1,411 to
administration, student services and various support
functions.
 One FTE in NC is one student attending 16 hours per
term times two terms – or 32 credit hours annually
(512 contact hours).
 So each credit hour was reimbursed by the state at
approximately $103.70 (health programs were paid
at $112.18.)
Financial Data
 CPCC is a Datatel College.
 We had the financial services area run a report on all
expenses by departmental budget code from state and
county funds. The report included all full and parttime salaries, equipment, expenses, teaching supplies,
travel, etc. – everything but grant funds.
 In NC all physical plant is the responsibility of the
counties (facilities, utilities, security, etc.)
 Mecklenburg County gives the College a salary
supplement for all faculty and staff. That amount was
added.
Financial Data
 We ran the FTE report by budget code.
 We calculated the number of credit hours
generated from the FTE.
 We calculated a cost per credit hour
 Let’s look at two examples
 One
low cost – the College makes money
 One costly – the College loses money
An Example from a Low Cost
Department
English, Reading and Humanities Division
PRE
State
Amt. per
credit
hour
County
County
Amt. per
Total State and Total per
credit hour
County
credit hour
$8,595.71
$1,101.61
$9,697.32
.
.
1264.8 40,472
.
.
FTE 07- Cred.
Prefix Subject
08
Hrs
Div Office
2.51
80
State
COE
Co-op
ENG
English
HUM
Humanities
68.18
2,182
.
.
JOU
Journalism
10.22
327
.
.
PHI
Philosophy
5.07
162
.
.
RED
Reading
348.62 11,156
.
.
REL
Religion
34.41
.
.
Sub-total
1733.8 55,480 $2,767,163.41 $49.88
$124,335.71
Total
1733.8 55,480 $2,775,759.12 $50.03
$125,437.32
1,101
$2,891,549.00
$2.26
$2,901,196.44
$52.29
What does this mean?
 In the 2007-2008 academic year, the English,




Reading and Humanities area earned 1,734 FTE in
classes delivered.
Those FTE calculated into 55,480 credit hours
generated.
Their total budget spent was $2,901,169 which
equaled $52.29 spent per credit hour generated.
The College earned $103.70 per credit hour or
$5, 753,276.
The College made$2,852,107 from English, reading
and humanities.
An Example from a High Cost
Department
Health Science Division – Dental Hygiene and Dental Assisting
PRE
Prefix Subject
DEN
Dental Assisting
FTE
Cred. Hrs
07-08
90.63
2,900
Division Cost (22.5%)
Total Dental Assisting 90.63
DEN
Dental Hygiene
24.25
County
County
Amt. per
credit
Total State
hour
and County $ cred hr
$415,983.86
$54,344.93
$470,328.79 $162.17
$70,125.31
$7,512.67
$77,637.99
$61,857.60
$21.33 $547,966.78 $188.94
2,900
$486,109.17
776
$402,275.12
$41,042.63
$443,317.75
$18,700.08
$2,003.38
$20,703.46
$43,046.01
$55.47 $464,021.21 $597.97
Division Cost (6%)
Total Dental Hygiene 24.25
State
State Amt.
per credit
hour
776
$420,975.20
$167.61
$542.49
What does this mean?
 In the 2007-2008 academic year, the Dental Hygiene area




earned 24.25 FTE and Dental Assisting earned 90.63 FTE
in classes/clinicals delivered.
Those FTE calculated into 776 credit hours for Dental
Hygiene and 2,900 for Dental Assisting.
The total budget spent in Dental Hygiene was $464,021 or
$598 per credit hour and $547,967 in Dental Assisting or
$189 per credit hour
The College earned $112.18 per credit hour (health
programs bonus) or $412,373.68.
The College lost $376,969 for Dental Hygiene and
$222,645 in Dental Assisting.
Two Entire Programs
Cost of Respiratory Therapy Program
Course
required
courses
BIO 163
MED 120
RCP 110
RCP 111
RCP 113
RCP 114
RCP115
RCP 122
RCP 123
RCP 210
RCP 211
RCP 214
RCP 222
RCP 145
RCP 152
RCP 235
RCP 247
Gen Ed
ENG 111
ENG 112
COM 110
MAT 121
PSY 150
HUM
Hours
Total
5
2
4
5
2
3
2
1
1
4
4
2
1
5
2
5
7
3
3
3
3
3
3
Cost/hr
$56.05
$111.82
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$155.50
$52.29
$52.29
$71.52
$43.77
$46.34
$52.29
Total Cost
FTE repay
$280.24
$223.64
$622.00
$777.50
$311.00
$466.50
$311.00
$155.50
$155.50
$622.00
$622.00
$311.00
$155.50
$777.50
$311.00
$777.50
$1,088.50
$112.18
$518.40
$224.36
$448.72
$560.90
$224.36
$336.54
$224.36
$112.18
$112.18
$448.72
$448.72
$224.36
$112.18
$560.90
$224.36
$560.90
$785.26
$156.88
$156.88
$214.56
$131.31
$139.02
$156.87
$311.04
$311.04
$311.04
$311.04
$311.04
$311.04
73
$8,923.40
$7,993.64
Cost to CPCC
-$929.76
Cost of Simulation and Gaming
Course
required
courses
SGD 111
SGD 112
SGD 113
SGD 114
SGD 212
SGD 213
SGD 214
SGD 285
SGD 289
SGD 122
SGD 123
COE 111
Hours
6 hours
6
Gen Ed
ENG 111
ENG 114
COM 110
MAT 121
HUM
SOC
3
3
3
3
3
3
Total
47
2
2
2
2
2
2
2
2
2
2
2
1
Cost to CPCC
Cost/hr
Total Cost FTE repay
$108.14
$216.28
$108.14
$216.28
$108.14
$216.28
$108.14
$216.28
$108.14
$216.28
$108.14
$216.28
$108.14
$216.28
$108.14
$216.28
$108.14
$216.28
$108.14
$216.28
$108.14
$216.28
$108.14
$108.14
Technical Electives
$108.14
$648.84
$52.29
$52.29
$71.50
$43.77
$52.29
$46.34
$156.88
$156.88
$214.50
$131.31
$156.87
$139.02
$103.68
$207.36
$207.36
$207.36
$207.36
$207.36
$207.36
$207.36
$207.36
$207.36
$207.36
$207.36
$103.68
$622.08
$311.04
$311.04
$311.04
$311.04
$311.04
$311.04
$4,091.52 $4,872.96
$781.44
Variations in Cost
 The lowest costs per credit hour were from the
general education departments:



Math = $43.77
Behavioral and Social Sciences = $46.44
Sciences = $56.05
 The highest cost programs were from Health
Programs and Engineering:
Cytotechnology = $566.29
 Surgical Technology = $307.63 (new)
 Computer Engineering = $306.41
 Electrical Engineering = $373.53

48% of Programs Decreased Costs
between 04-05 and 07-08
Decreased
Program
Costs
48%
Increased
Program
Costs
52%
Observations about
Program Costs
 Program costs are most impacted by faculty salaries,
equipment, technology, and class size.
 Programs with large class sizes and faculty hired within
the last several years have the lowest cost per credit
hour generated.
 Programs taught mostly by PT faculty have lower costs
per credit hour generated.
 Programs with smaller class sizes (due to accreditation
requirements and more tenured faculty have higher
costs per credit hour.
79% of programs grew in FTE
between 04-05 and 07-08
Grew > than 100%
Grew between 1% - 24%
Grew between 25% - 99%
Grew < 1%
7%
21%
26%
46%
Observations about
FTE Growth
 The study was conducted in a year when the
College experienced an enrollment increase of 12%.
 Enrollment increases were largely due to:
 introduction of new programs
 addition of high-demand sections
 increases in class cap sizes
 growing number of online classes
 convenience of six strategically located campuses
 retention efforts
Top 20 Highest Enrolled Courses for 07-08
(3,957 FTE or 32.8%)
500
450
400
350
300
250
200
150
100
50
0
Next Step: Plot the Programs into
1 of 4 Categories
Enrollment Trends
High Growth/ High Cost Programs
Programs with decreasing costs above the state
Programs with increasing costs above the
reimbursement rate that are growing
state reimbursement rate that are growing
enrollment.
enrollment.
High Growth/ Low Cost Programs
Programs with decreasing costs below the state
Programs with increasing costs below the
reimbursement rate that are growing
state reimbursement rate that are growing
enrollment.
enrollment.
Low Growth/ Low Cost Programs
Programs with decreasing costs below the state
Programs with increasing costs below the
reimbursement rate that are declining in
state reimbursement rate that are declining
enrollment.
in enrollment.
Low Growth/ High Cost Programs
Programs with decreasing costs above the state
Programs with increasing costs above the
reimbursement rate that are declining in
state reimbursement rate that are declining
enrollment.
in enrollment.
Trends
Costs
Results of the Study
Based on FTE and Program Cost
Comparison Data from 04-05 to 07-08
Increasing Enrollment/
High Cost (27)
13%
9%
42%
36%
Increasing Enrollment/
Low Cost (23)
Decreasing Enrollment/
Low Cost (6)
Decreasing Enrollment/
High Cost (8)
Program Planning
 Help us determine what objective to
assign each program (or cluster of
programs):




Hold. The objective is to maintain enrollment
growth and a healthy ROI.
Subsidize. The objective is to seek industry
support and funding to help underwrite costs.
Revitalize. The objective is to identify and
invest resources selectively.
Divest. The objective is to divert resources
where they can be better used elsewhere.
Programs of Focus: High Cost
Decreasing
Enrollment/ High
Cost (7)
13%
Increasing Enrollment/
High Cost (15)
31%
Initial Objective: Subsidize
 Industry Support and Funding was Sought to
Help Underwrite our High Cost Healthcare
Career Programs :








Cardiovascular Technology
Dental Hygiene
Nursing
Respiratory Care Technology
Surgical Technology
Cytotechnology
Health Information Technology
Medical Laboratory Technology
Results of Campaign
 Over $500,000 was received
in cash gifts and pledges
 Donations of equipment and
supplies
Next Objectives:

Focus on subsidizing the costs of our High Cost
Trade Programs at the Harper Campus (next up for
building expansion)

Focus on subsidizing the costs of our High Cost
Engineering Programs (going through a Statewide
Curriculum Improvement Process)
Questions or Comments?
For More Information:
Lori Alexander, Assistant to the VP, Learning Unit
Central Piedmont Community College
P) 704-330-6853
E) lori.alexander@cpcc.edu
Terri Manning, Assoc. VP Institutional Research
& Director, Center for Applied Research
Central Piedmont Community College
P) (704)330-6592
E) terri.manning@cpcc.edu