Losing Ground: 4th Annual College M&O Cost Study

Just as the nation's school districts are paying the price for decades of deferred maintenance, colleges too are feeling the effects of inadequately maintained buildings. It is estimated that America's higher-education institutions have a $26 billion backlog of repair needs, and it is expected that the needs and dollars required will grow exponentially unless the situation is addressed shortly.

According to American School & University's annual College Maintenance and Operations (M&O) Cost Study, colleges may be adding to the deferred maintenance dilemma by allocating fewer dollars and a smaller percentage of their total budgets to maintenance and operations. Overall, colleges earmarked 9.7 percent of their total institution budgets to M&O for the 1997-98 school year (compared with 10.5 percent last year). Spending on M&O per full-time-equivalent (FTE) student and per-square-foot also dropped.

Arriving at the results Data for the 4th annual College M&O Cost Study were compiled from an in-depth questionnaire mailed in November 1997 to approximately 1,200 physical plant directors at 2-year colleges and 4-year colleges with no significant graduate programs. Respondents were asked to document expenditures for various M&O categories for the 1997-98 school year, including salaries, benefits, energy, supplies and equipment.

In our attempts to provide useful comparative information, the cost study specifically targets 2-year colleges and 4-year colleges with no significant graduate programs. The reason larger 4-year institutions that have significant graduate programs are not surveyed is because their operations are so varied that results would be less useful for overall comparative purposes. Although this survey is not meant to properly reflect larger institutions' expenditures, it does provide some useful data to be gleaned.

When examining the type of institution responding to the survey, 95.1 percent of 2-year colleges were public and 86.8 percent of 4-year colleges were private. This should be considered when comparing your institution's costs with those reported in the survey.

Reviewing the data

Table 1 examines M&O spending per FTE student, and includes breakdowns by 2-year, 4-year, and all colleges for such categories as salaries, benefits, energy, water/sewer, supplies, equipment maintenance, equipment and total M&O, as well as identifies the percentage of the total budget allocated to M&O by colleges.

As highlighted in past years, 4-year colleges budget considerably more per-student for M&O than their 2-year counterparts. For the 1997-98 school year, 4-year colleges allocated $1,204 per student while 2-year colleges spent $431. The wide discrepancy in spending is most likely due to a number of factors, including the most obvious--4-year colleges differ significantly in their educational mission and offerings to students. In addition, 4-year colleges typically have more specialized buildings and courses; older physical plants; extensive laboratory and health facilities; housing concerns; and 24-hour, year-round usage than 2-year colleges.

Two-year colleges do, however, allocate a larger percentage of their total institution budget to M&O than 4-year colleges. Two-year colleges allocate 10 percent of their total budgets to M&O while 4-year colleges dedicate 9 percent.

Salaries and benefits represent the most significant portion of M&O costs at both 2-year and 4-year colleges. Two-year colleges spend 55 percent of their M&O budgets on salaries and benefits; 4-year colleges 48 percent; and all institutions 53 percent.

The next most significant expenditure per student is energy, including gas, electricity, oil and other sources. Four-year colleges dedicate a larger percentage of their budget (30 percent compared to 27 percent at 2-year institutions) to energy, and spend more than three times the amount ($362) per student than 2-year colleges ($118). The median college allocates 28 percent of its M&O budget ($200 per student) for energy. Four-year institutions post larger percentages and per-student costs in the remaining categories, as well.

Alternative calculations

While per-student costs vary widely between 2-year and 4-year colleges, M&O expenditures per square feet of building maintained are more comparable (see Table 2). For example, 2-year colleges spend $4.17 per square foot on M&O while 4-year colleges spend a $3.21. The median college allocates $3.59 per square foot.

Although most of the M&O costs per square foot for 2-year and 4-year colleges are fairly close, 4-year colleges maintain more than four times the amount of building space per FTE student than 2-year colleges. Four-year institutions maintain 431 square feet per student; 2-year colleges maintain 105 square feet. The median college maintains 220 square feet per student.

Median salaries paid a variety of M&O job functions at colleges can be found in Table 3, including:

-Administration: Those individuals who have managerial or supervisory duties (does not include the overall director of physical plant).

-Clerical: Those individuals who perform secretarial duties.

-Custodial: Those individuals responsible for building upkeep and cleaning.

-Engineer/Architect: Those in-house positions responsible for planning, design and specialized facilities duties.

-Grounds: Those individuals responsible for landscape maintenance and upkeep. 

-Maintenance: Those individuals who perform skilled jobs, such as plumbing, electrical or HVAC repair.

-Motor Pool: Those individuals involved with transportation operations.

-Security: Those individuals responsible for safety of buildings and equipment. Does not include professional security or law-enforcement officials, if employed by the college.

Please note that job functions such as security, engineer/architect and motor pool should only be factored in if they are part of your M&O budget.

Table 4 identifies the median number of full-time M&O personnel by function at colleges, as well as the median number of full-time M&O personnel per 100 FTE students. For the 1997-98 school year, the median 2-year college had 39 full-time M&O personnel; the median 4-year college had 51; and the median institution had 43 full-time M&O personnel.

Four-year colleges employ more than three times the number of M&O staff per 100 FTE students than 2-year colleges (3.80 compared to 1.19). The median college employs 2.08 M&O staff per 100 FTE students.

In addition to the tables featured, the study found that the median institution: Has a 1997-98 school-year budget of $2 million for M&O. Maintains 67 total acres. Has a full-time enrollment of 2,117 (3,450 at 2-year colleges and 1,350 at 4-year institutions). Maintains 516,019 gross square feet (gsf) of buildings (2-year colleges maintain 488,018 gsf; 4-year colleges maintain 604,500 gsf). In addition, colleges are more likely to contract out M&O services than their school district counterparts. More than 42 percent of 4-year colleges and 32 percent of 2-year colleges report turning over M&O to outside firms.

Respondents to the cost study again plan on making major M&O equipment purchases in the near future. Approximately 72 percent of all colleges plan to make major equipment purchases this year. More than 75 percent of 2-year colleges expect to purchase major equipment while 68 percent of 4-year colleges will be doing the same.

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