Rising tuition costs and crippling student debt continue to occupy the heart and minds of emerging classical musicians. But one major conservatory believes they have a solution to not only control costs, but begin easing them down for most students.
The Juiliard Institute plans to begin offering its students financial aid with repayment in the form of securing a percentage of their future earnings.
I spoke with Juliard’s vice president of finance and student services, Raven Proraté, about the program and she described it as a way to build lifelong partnerships with students.
We want our students to know that we’re supporting them, side by side, along every step of their career,” said Proraté. “Our new income sharing agreement is better than traditional scholarships because it means the schools offsets our increased risk by creating a revolving form of revenue over a student’s entire career span.”
According to Proraté, the school is sensitive to the need for structuring an income share agreement that only recovers a small percentage of revenue at the onset of their career but accelerates as their accomplishments grow.
“We like to describe the amount of income we recuperate as a soft float ratio,” described Proraté. “For the first decade following graduation, if they earn below a certain income level, the revenue share rate is fixed but it resets for everyone after that threshold based on a combination of increased income levels and/or time.”
An added benefit for the school is substantially lower alumni development costs, which Proraté described as a win-win for helping curtail tuition fees.
During the process of refining the program, we discovered the minimum level of contributed income we were expecting from graduates, including planned giving, could be entirely replaced by the income sharing program,” said Proraté. “This meant we could then downsize that entire department to the point of replacing it with a more efficient model of income verification and recuperation officers. As a bonus, it guarantees Juliard remains in constant contact with alumni!”
When asked if the school provides students with any sort of independent legal counsel prior to signing binding agreements that last the span of their entire professional music career, Proraté indicated the school eagerly provides the same level of guidance as existing financial aid programs.
We’re devoted to making sure the students understand how much this program benefits their desire to pursue a career as a classical musician,” said Proraté.
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