Public Universities Predict Tuition Hikes

Budget-strapped public universities are predicting significant tuition increases at a time when private universities are doing everything to maintain or even lower tuition rates during the recession, experts say.

Though 2009-2010 tuition rates have not been set for most public universities, increases of at least 5% to 6% — and in many cases higher — are expected as university administrators struggle to maintain quality education amid state budget cuts.

"State budgets are in turmoil," says Terry Hartle, senior vice president for the American Council on Education, an organization that lobbies on behalf of higher education administrators. "It’s a balancing act. Just about every revenue source that colleges have is under distress." The sources include state budgets, tuition income and endowments.

Hartle says the crisis could even lead to mid-year tuition hikes at public institutions that may have their funding cut between academic years. The $39 billion in the stimulus package for state budget education issues may help minimize tuition hikes, however, and Hartle says colleges are increasing aid to ensure that low-income families are not shut out.

The University of California system projects tuition increases of 9.3% after the state budget cut $115 million in university funding for the upcoming academic year, says spokesman Ricardo Vasquez. The system has been forced to limit enrollment, preventing about 2,300 California resident from registering as freshmen.

"We’re over-enrolled by 11,000 students," Vasquez says, but the university system will accept all UC-eligible students at one of the system schools. A new plan will grant free tuition to in-state students who qualify for financial aid and whose family income is under $60,000.

The University System of Maryland is working to freeze in-state tuition, says system chancellor William Kirwan. "We hope that’s going to be possible, but we’re not going to let the quality of the institution erode."

At the same time, many private colleges and universities have set the lowest tuition increases in decades. The University of Pennsylvania reports an increase of 3.8%, lowest in 41 years. Worcester Polytechnic Institute (2.9%), Princeton University (2.9%), Hamilton College (3%) and University of Denver (4.9%) report the lowest increases in recent history.

Though private institutions do not face the threat of budget cuts, they do rely on endowments as a major source of income. "They’re having to cut expenditures," says Sandy Baum, policy analyst for College Board and economics professor at Skidmore College in New York. "Their revenues from other sources are down." Both Baum and Hartle say institutions are trying to protect the quality of education and availability of financial aid.

U.S. Education Secretary Arne Duncan stresses the importance of affordability amid the budget and fundraising crises. "Colleges that go the wrong way on this — I think they’re going to see students walk away."

USA TODAY