This paper is the first in a series of reports and initiatives that will constitute AGB's Cost Project. The project is designed to build governing board capacity to monitor institutional costs effectively and strategically. Costs and productivity are not new issues in higher education. AGB and its member governing boards have long recognized the importance of responsible stewardship of institutional resources as central to the work of effective boards. But the rapidly changing environment in higher education has brought a new urgency to the topic. Many institutions have been at the forefront of change, having reengineered core functions and decentralized responsibilities for resource management. The Cost Project intends to identify such successes and promote them broadly within the higher education community. AGB is mindful that containing costs and sustaining quality require active partnerships among institutional leaders and others in the higher education and public-policy communities. A comprehensive effort needs to be built--to forge partnerships, to make the conversation more data-driven, to connect better with public audiences, and to find strategies to reach out to accreditation agencies and others concerned about ways to sustain quality and improve institutional effectiveness. While institutional chief executives must lead such efforts, boards should be actively engaged in these issues. Encouraging and enriching this process are goals of The Cost Project. As it embarks upon this work, AGB will collaborate with other groups interested in contributing to the agenda. This series of "The Cost Project" covers: (1) For a board to help steer a college or university in the direction of quality and value, trustees will need to untangle the language of price and costs so they can focus on how the institution uses its resources to achieve core functions; (2) Sustaining public support for higher education--not only in the form of predictable state and federal financial appropriations and continued philanthropic support but also in the form of public trust in the stewardship of our institutions--will require assuring the public that institutions are serious about cost management; (3) Boards can advance effective cost management by helping to shape the conversation about aligning resources with goals and creating a culture of heightened sensitivity to resource management across the campus; and (4) Boards should have strategies to communicate with key stakeholder groups about the costs of providing education and the price of attending the college. (Contains 4 endnotes.)