Budget update: Oct. 7, 2020
October 7, 2020
— by Dan White, chancellor
At last year’s November meeting, the Board of Regents debated, and eventually passed
a tuition increase of 5%. Students, particularly from Ӱ, came forward and expressed
their appreciation for the need to raise tuition but wanted to see the increase tied
to a budget analysis and be assured that the tuition would go to support academic
programs. At that time, the BOR charged the university with developing a tuition proposal
that was based on analysis of budget needs, affordability, and tuition at peer institutions.
For Ӱ, I asked the Tuition and Fee Committee and the Planning and Budget Committee
to come up with a tuition proposal that met the BOR’s intent for consideration this
Fall (for implementation next year). In addition, we asked the national firm Ruffalo
Noel Levitz to conduct a price sensitivity analysis for us to help inform our decision-making.
From this work came two proposals that were reviewed by the two committees and presented
in a student forum by Vice Chancellor for Student Affairs Keith Champagne. Both proposals
included a modest increase to tuition at some levels but not all.
Budgets have decreased across the system due to Gov. Dunleavy’s compact agreement
with the BOR that reduced state support by $70 million over three years. Across the
nation, many states have reduced support for state universities, shifting the financial
responsibility for higher education from states to students via increased tuition.
Ӱ was slow to this approach as the state maintained its strong support for UA.
At this point, however, with decreased state appropriation we must consider tuition
as a source of revenue to maintain the excellent academic programs our students expect.
Ӱ has also been careful not to propose large tuition increases and to ensure that
any increase is connected to a strategy that includes more financial aid for students.
Ӱ has two distinct but important missions. We serve as a community and technical
college, offering students workforce training. We are also a globally important research
university. These two missions have different cost structures, different student bodies,
different outcomes, and could reasonably have different tuition structures. This was
partially addressed in years past by differentiating lower-division from upper-division
undergraduate tuition. Unfortunately, community college tuition remains much higher
in the UA system than community colleges Outside. Ӱ is also a world leader in Arctic
research and our “research university tuition” is lower than our peers Outside even
though our cost structure is very similar.
To meet the BOR’s charge to consider tuition as a part of the budget, and to reflect
the difference in the Ӱ mission and cost structures, we are developing a proposal
for differentiated tuition. This request, still being refined, will be routed to UA
President Pitney and, if she approves, to the BOR for their consideration. Differentiated
tuition would enable Ӱ to have separate tuition rates for our community college
mission and our research mission. Differentiated tuition rates would also, in all
likelihood, result in different tuition rates between Ӱ compared to UAA and UAS
as they have different peers with different tuition targets. Differentiated tuition
would not be new to UA and not new to Ӱ. We currently compete in a global market
where tuition is differentiated in as many ways as there are universities.
At this point we have started collecting broader feedback on a proposed request for
a differentiated tuition model. Elements of a differentiated tuition model would likely
include:
- Freezing the lower-division tuition rate and adopt it for community colleges
- Increasing upper-division tuition 2.5% and increase graduate tuition 5%; this largely reflects the shift to increasing rates at the research university and begins differentiating between the two structures
- Freezing the nonresident surcharge
- Sunsetting the occupational endorsement and certificate discount, which is currently in its final year as a pilot program (year 3 of 3). Replace this pilot program with strategic financial aid and scholarship packages.
- Increasing financial aid and scholarships, including a focus on out-of-state students
- Building on the Nanook Pledge and other financial aid packages for two- and four-year students as well as add need-based scholarships to the current merit based model.
As we consider this proposal for a tuition model change, we will be holding a virtual forum on differentiated tuition a week from tomorrow, on Thursday, Oct. 15, from 1-2 p.m. Please join your Ӱ leadership and me in these discussions as we consider tuition options that preserve the quality of our programs for our current and future students.
Again, it is important to note that at this point, this is the culmination of much work by several committees to propose a model to President Pitney for her consideration for a November board submittal. Your input is needed.
Thank you for choosing Ӱ!
— Dan White, chancellor