January 24, 2002
Tuition examined: Local authority could help manage University
Just because the governor proposed local tuition-setting authority doesn’t mean it will be a reality when the Legislature closes shop after what is scheduled to be a 60-day session.
Last year, after all, a proposal by Gov. Gary Locke to hand over tuition-setting authority from the Legislature to the Board of Regents for all but resident undergraduates died. In recent years the Legislature has started giving what has come to be known as “up-to authority.” In other words, lawmakers set limits for how high institutions can raise tuition above a basic level they set. But the governor’s most recent tuition proposal would altogether eliminate Olympia’s role in setting tuition and, instead, put the campus governing boards in charge.
Officials say that such a move would help the University better balance core values of excellence and accessibility.
“Both sides of that equation are important,” said President Richard L. McCormick. “We are determined to ensure the continued funding of the University in a way that maintains its position as one of the leading public research universities in the country. But it is also critically important that we remain accessible to the students of our state from a combination of sources, including federal financial aid, state need grants, privately funded scholarships, and to the extent required, from new tuition revenue itself. We are committed to meeting our students’ additional financial-aid needs created by a tuition increase.”
Yet resident undergraduate tuition at the UW — which currently lags 15 percent behind the average of 24 institutions considered peers by the state Higher Education Coordinating (HEC) Board — is arguably second tier. That fact, combined with a potential cut in the neighborhood of $18 million to the operating budget, means maintaining adequate funding to keep the UW competitive will be increasingly difficult. Furthermore, some officials argue, low tuition benefits the state’s wealthiest students much more than it helps low- and middle-income students.
Associate Vice Provost for Planning and Budgeting Gary Quarfoth, for example, thinks the case can be made that low tuition amounts to a subsidized education for students who can afford to pay more.
“The lowest income students’ needs would be protected if tuition rose. So, if there is a tuition increase it will be accompanied by an increase in financial aid,” he said. “But we have many families who could afford to pay more to go to college.”
The goal is to cover the additional need for undergraduate residents that results from a tuition increase. Though no specific plan to accomplish that is in place at the moment, Kay Lewis, director of Student Financial Aid, is confident in the UW’s ability to protect students.
“As the University looks at a higher-tuition model, we always talk about higher financial aid,” she said. “There are schools that have successfully dealt with a similar model for years. It can be done here too.”
Such a model would generate more money for the UW with the higher tuition, while at the same time offer protection to low- and middle-income students in the form of grants and loans. The financial burden would effectively shift toward upper income students, who presumably can afford a tuition increase.
And in fact, it’s arguable that a large percentage of the student body would be able to afford a steep tuition increase. Consider:
- According to 2000 census figures, more than 250,000 families in Washington have incomes of more than $100,000;
- The median family income for students newly enrolled during the fall quarter of 2001 was $64,500;
- More than 40 percent of newly enrolled students are from families with an income of more than $75,000; and
- Fifteen thousand of the UW’s 26,000 undergraduates don’t even apply for financial aid.
In addition to grants and loans, low- and middle-income students at the UW will benefit from the institution’s increased commitment to drumming up private sector financial support. Longtime director of financial aid, Eric Godfrey, has recently been moved to a new position in the development office charged with increasing the amount of student support in the form of private scholarships.
He says that the proposition of helping a qualified student enhance his or her education is one that sells itself to people in the private sector.
“They find the idea of scholarships for deserving students very compelling,” he said. “It resonates with donors. The thought that scholarship support can not only ensure access for those who might not otherwise be able to afford the UW and it can also free up a student so that she can engage in other meaningful aspects of an education — undergraduate research, study-abroad programs, service learning — that’s very attractive to people.”
Meanwhile, tuition will likely continue rising. The economic realities of a slowing economy combined with a dip in state support for higher education mean it’s a virtual certainty that tuition will increase in the near future, whether or not the Legislature retains control.
“Tuition is going to go up, irrespective of who’s setting it,” Quarfoth said. “Probably the only thing we’re debating is how much, or how quickly tuition is going up.”
Regents currently have authority for a 6.1 percent increase prior to the 2002-03 academic year. Even if the board votes for the full 6.1 percent hike, the UW would be well in the red if also faced with the governor’s proposed $18 million cut. In fact, officials have said a 20 percent increase would be needed to make up that kind of gaping hole.
Such an increase would amount to about $800 annually for the average resident undergraduate student. Given the trend toward higher tuition even at public institutions, it would leave the UW still relatively affordable.
A report published last November in The Chronicle of Higher Education said that tuition at public institutions rose on average by 7.7 percent for the 2001-02 academic year. That was the most significant hike since 1993 and a full percentage point more than the increase at the UW.
“A component of the discussion about where tuition should be is how much money do we need and how do we get it,” Quarfoth said. “But another component should be looking at the UW in comparison to other campuses. What’s our level of tuition, what’s our level of state funding and how does that compare with other institutions?”
The University of North Carolina, considered a UW peer, raised tuition by 18.3 percent for the current academic year. The University of Illinois and the University of Minnesota — where tuition is more than $1,500 higher than at the UW — raised tuition by 15.2 and 13.5 percent, respectively. The University of Iowa, another peer, increased tuition by almost 10 percent.
The rising tuition is part of a trend that the University of Virginia’s David Breneman has followed closely over the last 20 years. Breneman, a leading scholar in the economics of higher education and Dean of UVa’s Curry School of Education, says the high point of state support for higher education was about 1979 or 1980. Since then costs have been steadily shifting from taxpayers to students and their families.
Tuition is also affected by the business cycle, he says.
“When times are good, like in the mid and late 1990s, states will have revenues flow in pretty well and they’ll often do pretty well by higher education. In doing that, they make it possible to keep tuition down,” Breneman said. “When things get bad, as they are now, higher education tends to suffer disproportionate cuts and tuition starts going up at very high rates. For a while that seems to be acceptable then the economy gets better and there’s a tuition freeze or in some cases tuition is rolled back.”
That’s what happened at Virginia. Students who enrolled at UVa in 1996 actually saw their tuition go down over the course of four years, according to Breneman. Those who are entering now are probably going to see it increase, he says.
Closer to home, Washington state business leaders are starting to embrace the idea of greater tuition flexibility. The Washington Competitiveness Council, the Washington Round Table and the Greater Seattle Chamber of Commerce have all endorsed the idea.
Understandably, perhaps, students aren’t as receptive. They point out that of the students who leave the UW with loan debt it averages in the neighborhood of $15,000. But Quarfoth counters that only half of the students who graduate from the UW leave with any loan debt at all. The other half leaves owing nothing.
With that in mind, Quarfoth says it’s important to consider both the public good and private good associated with higher education. The public good is significant enough that one could argue the state should pay all the costs of higher education, he says.
“Highly educated people are needed in the economy,” Quarfoth said. “They get good jobs and generate tax dollars. They’re less likely to be on welfare. They’re healthier.”
But obviously, he says, there are private benefits too.
“Not surprisingly, if you have a college degree you are much more likely to have a higher income than if you don’t have a college degree. So there is a substantial private good with higher education and certainly that private benefit is such that sharing the cost between the state and the individual makes sense. The question we are all wrestling with is what the respective proportions should be.”
