Higher Tuitions Aren't Inevitable, Report Contends

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College-tuition costs continue to climb, but neither federal, state, nor institutional policymakers are addressing the causes of the problem, a new report contends.

Tuition and fees at public and private colleges and universities have increased fivefold since the 1976-77 academic year, far beyond the rate of inflation, according to "The Tuition Puzzle: Putting the Pieces Together," released last week by the Institute of Higher Education Policy, a Washington nonprofit organization.

"Policymakers all have this sense that rapidly escalating prices are inevitable," said Jamie P. Merisotis, the president of the IHEP. There is "a more predictable, reasonable approach to increasing tuition levels."

The increase is primarily the result of declining appropriations to colleges from federal and state governments, the report says. In response, colleges and universities have hiked their prices, as well as the amount of student aid they provide.

"The price spiral has been exacerbated by institutional spending patterns, particularly to increase funding for student aid in order to maintain access and affordability," the report says.

Declining Aid

For More Information:

A free copy of "The Tuition Puzzle: Putting the Pieces Together" can be obtained by writing to the Institute for Higher Education Policy, 1320 19th St. N.W., Washington, DC 20036; or by calling (202) 861-8223. The entire report is also available as a PDF file from the IHEP Web site (requires Adobe's Acrobat Reader).

During 1980-81, state revenues made up about 46 percent of public college and university budgets. By 1994-95, the figure had dropped to 36 percent. Federal revenues made up 13 percent of public institutions' budgets during the 1980-81 academic year, and 11 percent in 1994-95.

For private colleges' budgets during the same period, state funding remained static, at 2 percent, and federal funding dropped from 19 percent to 14 percent.

Meanwhile, tuition and fees rose. For 1980-81, the average tuition and fees at a public college averaged $1,442; by 1994-95 they had increased to $2,814, a jump of 95 percent. Private colleges charged an average of $6,482 in 1980-81; that figure was $11,545 in 1994-95, or 78 percent more.

The report offers numerous recommendations to policymakers and institutions to reverse the trend toward higher costs. Among them:

  • Institutions and states should realign tuition structures, increasing the costs of graduate and professional-level programs so undergraduate prices will be less expensive. Moreover, financial aid should be used effectively to guarantee access to needy students.
  • Colleges should change the common practice of determining their needs before writing their budgets--an approach that Mr. Merisotis says forces them to increase costs to cover expenditures. Instead, he argues, colleges should first set reasonable tuition levels, then outline their budgets.

Vol. 18, Issue 23, Page 20

Published in Print: February 17, 1999, as Higher Tuitions Aren't Inevitable, Report Contends
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