UConn Proposes Five-Year Tuition Plan With Lowest Increases in Recent History

A message to UConn faculty regarding COVID-19. (Sean Flynn/UConn Photo)

UConn officials are proposing a five-year tuition plan that limits annual increases to their lowest levels in five years, with the goal of balancing affordability with protecting and strengthening academic quality.

The plan is being presented to UConn students today (Dec. 5) at two open town hall forums. The proposal will be presented to Financial Affairs Committee of the UConn Board of Trustees on Dec. 9, and to the full board during its Dec. 11 meeting.

“In my early conversations with Gov. Lamont and members of the General Assembly, I asked that they do all they could to hold state funding for UConn steady,” UConn President Thomas C. Katsouleas said. “That happened for the current fiscal year, and I am hopeful it can continue.  As a result, we are able to propose tuition increases that are significantly lower than those enacted in recent years. This reflects the importance of the social contract between the state, its citizens and UConn as Connecticut’s flagship public university.

“Over time, holding the block grant steady or increasing it for specific priorities will allow us to increase other sources of revenue, including graduate and executive education programs, research funding and philanthropy.  This will enable UConn to grow its mission and expand its contribution to Connecticut’s economy and workforce.”

Under the previous tuition plan adopted in 2015, in-state tuition increased at UConn by $950 in the current year of 2019-20, and by $1,250 for out-of-state students.

In the first year of the proposed new five-year plan, tuition would increase by $608 for all students. In the following years, it would increase by $625 in fall 2021; by $642 in fall 2022; by $660 in fall 2023; and by $679 in fall 2024.

In-state tuition is currently $13,798, while out-of-state tuition is $36,466.

As has been the practice for many years and required by state statute, the amount of funds to support financial aid will increase accordingly each year when tuition rates change, ensuring reliable support for Connecticut’s neediest students.

When institutionally funded aid is factored in, the average in-state UConn student pays about $9,200 in annual tuition, with those who receive federal Pell Grants paying less than that.

The cost of tuition and fees for Connecticut residents remain a fraction of what it would cost them to attend many private institutions or public universities outside of Connecticut:

 

Tuition and fees fund approximately 41 percent of UConn’s annual operating budget. UConn’s state support funds 26 percent, with the rest of the budget coming from auxiliary revenue, research grants and philanthropy.

UConn officials say the tuition proposal reflects the smallest possible increase necessary to protect the academic gains made over the years. Those gains have transformed the University into one of the nation’s top 25 public institutions, with record-high freshman SAT scores and applications, and the most diverse student body in its history.

The university will also continue to reduce costs through consolidations, operational efficiencies and other measures that all will be vetted to ensure they do not compromise UConn’s academic quality. UConn has saved tens of millions of dollars in recent years, including through a program called “Spend Smart” in which 37 university schools, departments and units launched more than 200 savings initiatives, cutting costs by almost $29 million.

Moreover, several university offices also have been consolidated at UConn and the regional campuses to gain efficiencies and savings, and operations ranging from human resources to procurement, public safety, and legal services have been combined for UConn and UConn Health under single departments.

“While much has been accomplished to date, the mandated costs ahead of us and our commitment to limiting tuition increases will require us to continue to aggressively manage our budget by cutting costs and finding efficiencies,” said Scott Jordan, UConn’s executive vice president for administration and chief financial officer. “It’s critical that the full burden of meeting increased costs doesn’t fall on our students.”

The dollar figures proposed in the new five-year tuition proposal were arrived at based on a combination of factors: the current cost of tuition, the Higher Education Price Index – which is the rate of inflation for higher education – a flat dollar figure, and costs that UConn must fund as a state agency, such as state employee healthcare and fringe benefits:

–          In-state tuition is currently $13,798.

–          The plan adds a flat $100 increase plus inflation to cover increases in personnel costs, materials, services, utilities, and other expenses, as well as to support improvements that maintain institutional excellence. The Higher Education Price Index estimates inflation in the sector to be about 2.8 percent next year, which calculates to about $389 in new tuition dollars per student.

–          Finally, a dollar amount is added to offset increased fringe benefit costs that UConn must pay as part of Connecticut’s plan to catch up with unfunded pension and retiree healthcare liabilities statewide, which have built up over many years. In 2020-21, that results in the need for about $119 per UConn student.

–          For 2020, those factors result in a total of $608 in new tuition dollars per student (the flat $100, plus $389 from the inflation index, plus $119 in fringe benefit costs).

As with UConn’s two previous multi-year tuition plans (enacted in 2011 and 2015) the university may recommend to the board that tuition rates be revisited if there is a significant drop in UConn’s state appropriation or a significant increases in costs that must be borne by the university as a state agency.

The state’s block grant to UConn funds 47 percent of employee salaries, with the remaining 53 percent funded by tuition and fees, auxiliary enterprises, research, grants and contracts and other non-state revenue sources.

When the block grant is reduced – as it has been in several of the past 10 years, with a total of $40 million cut since FY 2016 – the University has had to turn to tuition and other sources to make up those lost dollars.

The state’s annual operating grant to UConn has averaged about $214 million annually since FY 2010, but the FY 2019 budgeted grant is about $14 million lower than that 10-year average. In fact, it is currently about the same amount as it was in 2005.

As currently presented with the assumption that state aid will remain level, the full cost of attendance to attend UConn Storrs in 2020-21 would be $31,092 for in-state students and $53,760 for out-of-state students.

That includes the new tuition rate along with mandatory fees, plus average room and board. Those figures are currently $3,428 in fees and $13,258 in average room and board, but could change when the 2020-21 figures are determined in spring 2020.

The majority of UConn students do not pay full price for tuition, though. In fact, 63 percent receive gift aid that they do not have to repay, including 27 percent who receive federal Pell Grants.

Fall 2020 will also be the first year of UConn’s new Connecticut Commitment program, which provides free tuition for entering in-state freshmen and transfer students with household incomes of $50,000 or less.

The Connecticut Commitment program had no impact on the proposed tuition increases being presented at the town hall events today and to trustees next week. The tuition plan would be the same even if that financial aid program had not been enacted.

The Connecticut Commitment is among several scholarship initiatives that UConn, along with the UConn Foundation, has either launched or in which it participates to help qualifying students meet their financial needs. They include the $2,000-per-semester President to President Scholarship for transfer students; the Hartford Promise and New Haven Promise programs; and many others awarded by individual schools and colleges.

UConn invests significantly in financial aid to help keep the University affordable and accessible, with about $123.1 million set aside in the current year’s budget specifically to fund institutional aid that students do not have to repay. That’s up 26 percent over the last three years.

“Access and affordability for our neediest students is a top priority,” said Nathan Fuerst, UConn’s vice president for enrollment planning and management. “Effective financial aid programs are critical to assisting our students in achieving their educational goals, and we anticipate adding to those programs further to continue drawing and retaining those students.”

The tuition proposal purposely used dollar amounts to increase the rates per year rather than percentages. That helps UConn avoid enacting a disproportionately high increase on out-of-state and international students that would put it at a competitive disadvantage to draw highly talented students from other regions.

Because out-of-state tuition is significantly higher than in-state rates, percentage increases that have compounded over time have placed UConn as second only to the University of Vermont among public university competitors in the rates charged to non-resident students.

Connecticut students comprise about 80 percent of UConn’s student body – a ratio that has consistently held for approximately a decade – but UConn also needs to attract talented non-residents, as the number of high school graduates in Connecticut is shrinking.

Without non-residents attending UConn, the in-state tuition rate would have to increase by 56 percent to continue providing the academic quality currently offered.