Universities Instituting Tuition Freezes in the Face of Declining Enrollment

Posted By Donna Fuscaldo on February 4, 2016 at 2:48 pm
Universities Instituting Tuition Freezes in the Face of Declining Enrollment

With the outcry over skyrocketing college tuition growing louder and states aiming to reduce expenses, a handful of colleges and universities are looking to freeze tuition across the board at state-funded higher education institutions.  Earlier this month, the University of Illinois board of trustees approved a tuition freeze for new in-state undergraduates starting in the fall of 2016.  Meanwhile, legislators in Tennessee are pushing for the state to freeze in-state college tuition for two years, as well as limit increases thereafter.

The calls, during an election season, come at a time when countless students are struggling to keep up with increasing tuition costs and many end up saddled with thousands of dollars in student loan debt. The nation collectively owes  $1.3 trillion in student loans, yet many college graduates remain unemployed or underemployed.

College tuition increases prompting the push

With a tuition freeze, students “will theoretically have more certainty regarding tuition expenses and will be relieved of these really excessive loans,” says Martin Daniel, a State Representative in Tennessee and co-author of The Tuition Stability Act, along with Sen. Dolores Gresham, chairman of the Senate Education Committee. “The cost of college, combined with concerns [over] whether universities are using [their] resources in an efficient manner,” is driving this move. According to Lt. Governor Ron Ramsey, the cost of a college education in Tennessee has increased 400 percent in twenty years.

Under the proposal, tuition and mandatory fees would be frozen at all of Tennessee’s public universities until the 2018-2019 school year. After that, schools would need full governing board approval for increases greater than two percent above the consumer price index. Incoming freshmen in the 2018 school year would see their tuition and mandatory fees stay fixed through their undergraduate years, granted they stay enrolled and graduate on time.

At the University of Illinois, the tuition freeze represents the second year in a row the trustees opted not to raise tuition and mandatory fees. The goal in Illinois is to help middle-class families that aren’t eligible for financial aid but don’t make enough to cover the cost of college on their own. The university is also facing increased competition from out-of-state schools that offer students competitive tuition prices and rich financial aid packages, according to the Chicago Tribune.

While tackling the issue of ever-increasing tuition is the main goal of the proposal, Daniel says it also gives lawmakers an opportunity to study inefficiencies within state universities that are causing waste. Take the University Of Tennessee’s diversity and inclusion program, created to ensure that the system had a diverse student body. Daniel says the program costs the state over $5 million but has only vague goals. “Some of the problem is – why should students take on student loan debt for these vague programs?” he says.

Tuition freezes come with strings attached

Tuition freezes are supposed to help students, but not everyone is sure about the effectiveness of these proposals. According to higher education experts, tuition freezes are common coming out of a recession, but the benefits to families may not be as clear as policymakers would like you to think. That’s because some states use tuition freezes as an opportunity to cut other spending on colleges and universities, including financial aid and student services.

Daniel says that isn’t the intention with the Tennessee proposal, although he does question six-figures salaries going to administrators of these state schools. “Every time you pick up the paper, you read about an institution of higher ed hiring a new five- or six-figure salary administrator,” says Daniel, noting that cutting financial aid isn’t part of the idea behind Tennessee’s tuition freeze. “It might be top heavy, and we want the faculty and the productive employees to do the work over there.”

While that may not be the goal in Tennessee, there is evidence that tuition freezes do lead to other cuts in higher education.  One only needs to look to Wisconsin Governor Scott Walker for evidence, says Mark Huelsman, senior policy analyst at Demos, a public policy think tank. “Scott Walker froze tuition for in-state students, but he decimated student support and faculty support,” says Huelsman. “He relied on out-of-state students to pay more.” Huelsman says there is little evidence outside of politics that temporary tuition freezes have any impact, and more often than not, they harm students because of other cuts.

“It’s all about perceptions,” adds Mark Kantrowitz, a financial aid expert, of the less-than-altruistic reasons politicians are pushing for tuition freezes. “Freezing the sticker price gives the impression that they are doing something about it, but you have to look at the entire picture of the state. If they are keeping tuition flat, are they increasing spending on higher education to make up for the loss in tuition?” says Kantrowitz.

Donna Fuscaldo
Donna Fuscaldo is a freelance journalist hailing out of Long Island, New York. She has also written for Bankrate.com, Glassdoor.com, SigFig.com, FoxBusiness.com, Business Insider, Dow Jones Newswires and the Wall Street Journal.

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