Frequently Asked Questions

When students pay tuition, this money is used to cover the university’s operational expenses – ensuring that the university functions smoothly and maintains high-quality education and services. Here's how the tuition revenue is utilized:

1. Salaries and Benefits: The largest portion of tuition fees goes to paying the salaries and benefits of professors, administrative staff, and other employees. This ensures that the university can hire and retain qualified personnel to provide education and support services.
2. Facilities and Maintenance (Occupancy): Tuition helps cover the costs of maintaining and operating campus buildings, classrooms, labs, and other facilities. This includes utilities, repairs, and upgrades to keep the campus safe and conducive to learning.
3. Academic and Administrative Services (Purchased Services): This includes expenses for services the university needs to run effectively, like IT services, security, consulting, and other contracted services that support both academic and administrative functions.
4. Scholarships and Financial Aid: Part of the tuition revenue is used to fund scholarships and financial aid, which help make education accessible to more students by reducing their financial burden.
5. Educational Resources: This includes spending on libraries, research materials, lab equipment, and other educational resources that enhance the learning experience.
6. Debt Service (Interest): The university uses a portion of its revenue to pay interest on borrowed funds, which were used to finance major projects like building new facilities or upgrading existing ones.

No, tuition is not used to fund the endowment.

The endowment is funded through donations. Individuals, alumni, corporations, and other donors give money to the university to establish or contribute to an endowment fund.

The endowment is a large pool of money that the university invests. The earnings from these investments are used to support the university in various ways, such as funding scholarships, research, and other special projects. The endowment is intended to be a perpetual source of income for the university.

We use an outsourced chief investment office (OCIO) to manage the pooled investments portion of our endowment.  The OCIO selects appropriate asset managers to invest and manage our investments across various asset classes.

The university draws funds (i.e. payout) from the endowment according to the Board-approved spending policy to fund specific activities or programs as designated by the donors. For example, an endowment fund might support a scholarship, a faculty position, or a research project.

Tuition is collected from students and is used to cover the daily operational costs of running the university.

Donations fund the endowment. These funds are invested, and the payout from these investments are used for specific purposes as defined by the donor. The endowment is intended to be a perpetual source of income generated over time.

The ratings (A1 from Moody’s,  A+ from S&P), coupled with stable outlook, reflect a strong assessment of the university’s financial health by both of the leading rating agencies. Our ratings being affirmed signal our continued strong financial position and indicate that the university is fiscally sound, financially stable, and well managed. Moody’s highlights our very good brand and strategic position as a large, comprehensive, urban university. S&P adds that the university’s financial risk profile is strong.

Operating margin is a crucial financial metric as it reflects GW’s ability to cover its operating expenses with its operating revenues. A strong operating margin, above 2%, would provide the university with increased financial flexibility to reinvest this surplus into strategic initiatives such as strengthening academic offerings, improving the student experience, enhancing research capabilities, improving campus infrastructure, and attracting top students and faculty. It also gives the university necessary resources to tackle unexpected costs.

A positive and stable operating margin can also solidify and enhance the university's creditworthiness, making it easier for the university to secure favorable financing terms for capital projects.

GW’s endowment is composed of a diversified portfolio that includes pooled investments and significant real estate holdings. Pooled investments, which include global equities, fixed income and alternative investments in hedge funds and private equity, provide liquidity and growth. They also help to stabilize the endowment by spreading risk across various asset classes while seeking market returns. Real Estate investments provide a reliable and steady earnings stream through rental income and ground lease income. These properties are in strategic locations, provide the endowment with valuable income and typically also appreciate over time. By balancing growth-oriented pooled investments with income-generating real estate, the endowment aims to provide both immediate financial support and long-term sustainable asset appreciation.