Tuition and fees may be increasing for the incoming freshman class at Ohio University in 2016.
As The Columbus Dispatch reported, the university’s budget advisory committee is recommending raising tuition by 1.7 percent. The committee also advised increasing rates for out-of-state students by 5.5 percent, which would raise tuition for these students from $8,964 to $9,457. Additionally, the committee suggested raising room-and-board fees. All told the measure, if approved, would bring in an additional $3.4 million.
According to the Dispatch, the move comes after the budget committee estimated a $24 million shortfall for fiscal year 2017 if revenue wasn’t increased or spending cut. The committee began meeting earlier in the year than usually scheduled in order to allot additional time to budget discussions and have a more thorough proposal ready to present to the university’s board of trustees.
“The committee estimated a $24 million shortfall for fiscal year 2017.”
In a statement, Ohio University spokesperson Bethany Venable said the shortfall would be resolved by the time a finalized operating budget was shown to the trustees at the end of January. She noted the deficit reflected the university’s commitment to securing funding for its core priorities, which include scholarships, increased employee compensation and new construction.
The cost of priorities
Improved employee compensation, which would include both increased salaries and more funding for health coverage, is projected to cost the university $11.7 million in the 2017 fiscal year, according to a report from The Athens Post.
The paper reported if cuts must be made from the university’s wish list, they are more likely to come from employee benefits than from scholarship programs. Though the university recently made changes to its scholarship model that are actually draining more from the school’s finances, the increased support for high-talent students is expected to lead to increased academic success for the school and eventually increased enrollment and tuition. The university estimated every 14 cents spent on a scholarship for a talented student would lead to 86 cents in tuition from attracting new students to the school.
Speaking with the Dispatch, English professor and budget committee member Beth Quitslund noted finding funding for the university’s priorities while addressing the projected deficit will require “ingenuity.” Quitslund added that the challenges facing the committee would persist in the coming years, and therefore required a long-term problem-solving approach.
Fees and tuition up throughout the country
It seems Ohio University isn’t the only higher education institution considering or implementing rate increases. According to the College Board’s “Trends in College Pricing 2015” report, the average tuition and fees for a four-year, in-state college rose by 2.9 percent over the last year to $7,350. For private, nonprofit schools, the increase was 3.4 percent to an average of $30, 521. Room and board also spiked in the last year: 3.3 percent at private colleges and 2.7 percent at public colleges.
The report noted these increases are actually small by historic standards, but general inflation rates make the impact of the 2014-2015 tuition and fee hikes greater than those experienced in 2013-2014.
“Significantly, and perhaps counter to public impressions, price increases are not accelerating over time,” the report noted. “However, the average published tuition and fee price of a full-time year at a public four-year institution is 40 percent higher, after adjusting for inflation, in 2015-16 than it was in 2005-06.”
“The affordability of higher education isn’t simply about tuition increases.”
However, the report found determining the affordability of higher education isn’t simply about assessing tuition increases. The income levels of students and their families must also be considered. While the average income of the middle 20 percent of families has increased in the last two years, the report determined the average tuition increases in 2014 would require 69 percent of that income increase to cover – making scholarship programs, such as those prioritized at Ohio University, essential to many students.
How Questica can help
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With flexible and highly configurable tools, Questica can be utilized by schools of all sizes to forecast budget solutions for an unlimited number of scenarios, and evaluate the impact on students, their families and the school’s employees. Contact Questica today to learn how advanced budgeting tools contribute to more informed financial decisions.