Small universities across the county, including the University of Portland, are under increasing pressure to provide more financial aid to incoming students as federal pandemic relief funds dry up.
According to Vice President for Finance and Operations Eric Barger, UP remains committed to providing accessible education. However, the rising cost of financial aid has strained its budget.
The university’s discount rate — the portion of tuition subsidized through grants and scholarships — has surged to 57.4%, more than 10% higher than pre-pandemic levels, contributing to a 7.2% operating deficit.
"When scholarships get too high, it erodes our ability to provide that education, to pay the expenses,” Barger said. “So I think we're always in a mode of, ‘How do we most efficiently use the resources we have to deliver on the education as efficiently as we can without affecting in a negative way the student experience?’ That's our goal.”
This increase in financial aid has come at a time when enrollment has dropped below expectations. UP enrolled 711 first-year students this fall, missing its target of 725. With fewer students contributing tuition, the heightened financial aid packages further strain the university’s budget.
Despite these challenges, UP’s strong endowment and donor support have kept it on solid financial ground.
“In the end, we're actually going to see a positive bottom line for the university fiscal year 2024,” Barger said.
According to Barger, the University maintains relatively low debt compared to other Northwest institutions. Combined with its large endowment, this strengthens UP's financial position, ensuring that despite its liabilities, the University has a significant reserve of resources to rely on.
Still, efforts to generate revenue by strengthening enrollment are underway.
For example, the newly launched Moreau Pathway Program offers automatic admission to well-performing students from Catholic high schools in the Portland Metro Area and Southwest Washington.
According to Dean of Admissions Matt Deschner, the program is part of an effort to recruit from UP’s “backyard,” rather than from far-away cities where travel difficulties — from COVID outbreaks to natural disasters — could affect enrollment.
“Frankly, we haven't done what we need to in our backyard,” Deschner said. “So now is an opportunity to really look forward and recruit heavily in Oregon and Washington”
Additionally, the University has launched 13 new academic programs in the last year — such as Bachelors in Business Administration in supply chain and business analytics — to attract more prospective students in high-demand fields.
“I think the [newly added] programs are designed to align with what we think students who are potentially going to come to the University of Portland are interested [in],” Barger said.
Rather than slashing under-enrolled programs, the University has offered early retirement incentives to some faculty in those areas to reduce costs while keeping the programs intact.
According to Barger, no non-adjunct faculty have been laid off, although the University has not decided whether faculty and staff will receive an annual salary increase this year.
However, the University is working on pooling money for faculty compensation this year while still trying to close the revenue-budget gap, according to Barger. He says the University hopes to have more information about the effort later this year.
Looking ahead, UP is advancing its ongoing fundraising campaign to support its financial goals.
“We are in what we call the leadership phase,” Barger said. “And this is a place where we've already kind of decided on our goals, our purposes, and we're talking to a few kinds of key people, whether they're in the Board of Regents or otherwise affiliated with the university, about giving certain lead gifts.”
Lead gifts are meant to attract more dollars, and as the campaign gains steam. With $65 million already raised, the University’s fundraising campaign is expected to go public in 2026 once it raises $200 million in lead gifts, half its $400 million goal.
According to Barger, of the $400 million, $200 million is intended for scholarships and $80 million is targeted at the Student Welcome and Engagement Center. The rest will be allocated among a variety of other projects.
Riley Martinez is a member of the editorial board. He can be reached at martinri24@up.edu.
