University Business - October 2011 - (Page 40)

Tuition Setting the goal to raise tuition as little as possible, but the awareness that the college needs to do so to continue to “align the admissions process with the college’s mission.” Hamilton, with its long history and success in fundraising, has been able to maintain that commitment. Jerry Lucido, an experienced enrollment manager and now professor of research and executive director of USC’s Center for Enrollment Research, Policy, and Practice, notes several key questions that should be asked during the tuition-setting process: “Are we supporting our education mission and our purpose with tuition policies or is this an exercise in business operations? Are our ambitions (those that are funded through tuition) in line with our mission or are they driven by externalities (like rankings)? Are we doing what we can to meet the nation’s need for college-educated populations across all race and income classifications?” • What is the picture for need-based financial aid? On the one hand, the federal government, in the Budget Control Act of 2011—which resolved the dispute over the debt ceiling for the short term—increased funding for the Pell Grant program. Seventeen billion dollars of mandatory funding and former long-time director of financial aid at Princeton, points to the increases in tuition and the accompanying discount rates at many private colleges as they try to remain competitive with public institutions. “Loans are going up and up,” he says. “There is earlier planning on a family’s part now, and they are getting more savvy on We wonder whether further transparency will lead toward a trend of the actual net cost becoming closer to the published sticker price. over two years was put on the table, outside of the discretionary appropriations process, increasing the overall amount of aid available for more students, though not increasing the maximum aid award of $5,500 in 2011. However, subsidization of graduate student loans was cut, as was the small reward for prompt repayment. With more negotiations to come on the budget and debt ceiling, there may be more federal student aid cuts on the horizon. One wonders how federal, state, and institutional aid can keep up with the costs of educating students. All of which is occurring in the face of state budget cuts and continuing economic malaise. At many colleges and universities, the combination of decreased income from endowment, or a lack of much endowment income in the first place, and increased costs, has put significant pressure on administrators to raise tuition and fees. There also is the desire to set tuition in accordance with a college’s peer group, whether that means not going too high, or going too low and not bringing in available revenue. Heather McCowen, former assistant dean for enrollment and student services at Roosevelt University’s Chicago College of Performing Arts, notes, “There was a definite strategy by the upper administration to bring RU’s tuition more in line with peers. Unfortunately, we started to see a decline in applications and retention once the school went beyond the $25,000 per year point. ... Last year, this resulted in a 6.8 percent hike in tuition, with no increase to the scholarship budget. This had a lot of impact on the retention of students.” Don Betterton, a college consultant their college visits to talk with the financial aid office.” That said, Betterton believes that “the economic model of costs going up so much has got to break down at some point.” In the face of higher costs, families are looking to community colleges for two years and programs like NJ Stars in New Jersey to help keep expenses down and find a lower total cost of attendance to earn the four-year degree. • Will lowering sticker price tuition become a trend? It is too early to say. It is clear to us that the message colleges and the federal and state governments are sending—that college is affordable to most families, significant aid is available, and most don’t pay the full cost—is drowned out by the steady drumbeat of data and news stories showing price increases at all kinds of colleges, increases in the proportion of students taking on loan debt at ever-higher levels, and concerns among families about their ability to save and pay for college. High costs, whether perceived or actual, lead further to a questioning of the value of a college education itself, with institutions forced to justify their existence and the value of their “pricey” education and “country-club” facilities. Arguments that even full-paying students don’t cover the total cost of their education, which is subsidized by alumni giving, endowment funds, state taxpayers, and so forth, fall flat with families wondering whether $20,000, $30,000, or $50,000 per year is not only a viable expense, but a worthwhile one. We wonder whether further transparency will lead toward a significant trend of price decreases, with the actual net cost universitybusiness.com Committing to Lower Tuition Increases Very few colleges and uniVersities have actually cut their tuition, according to a national association of independent colleges and universities survey of members released in June. other measures have been taken, though. some institutions have frozen or allowed buying of four years, including Catawba University (n.c.) and the Sage Colleges (n.y.). others have committed to lower tuition increases than in the past. for example, 2011-2012 tuition rates at these colleges have gone up modestly: • Boston University, 3.85 percent • Elmira College (n.y.), 3 percent • Elon University (n.c.), 3.98 percent • Georgetown University (d.c.), 2.9 percent • Lehigh University (Pa.), 3 percent • Princeton University, 1 percent • Syracuse University (n.y.), 3.8 percent yet, according to naicu, private college and university tuition and fees rose an average of 4.6 percent for 2011-12, continuing several years of increases in the 4 percent range, versus the average annual increase of 6 percent during the 10 years prior to the recession. to balance the increases in tuition, naicu reports an average increase of 7 percent in institutional aid. 40 | October 2011 http://www.universitybusiness.com

Table of Contents for the Digital Edition of University Business - October 2011

University Business - October 2011
Contents
Editor's Note
College Index
Ad Index
Behind the News
Sense of Place
Viewpoint
Human Resources
Cloud Email
Tuition Setting
Campus CFO
Independent Outlook
End Note

University Business - October 2011