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Seeking "moderate course" on tuition and fees, UMass committee approves 4.9 percent increase

University will build on record financial aid spending

DARTMOUTH -- Pointing to the University's need to steer "a pragmatic middle course," the UMass Board of Trustees Committee on Administration and Finance today approved a 4.9 percent tuition and fee increase for undergraduate students for the upcoming academic year.

The increase will on average raise tuition and fees by $580 for in-state undergraduate students during the 2012-2013 year, and the 4.9 percent increase - which applies to all undergraduate and most graduate students -- will generate $25 million in net additional revenue.

The fee increase was approved with an amendment, offered by Board of Trustees Chairman James J. Karam, that said the University would freeze tuition and fees for in-state, undergraduate students in academic years 2013-2014 and 2014-2015 if the state agrees to fund 50 percent of the cost of the University's education programs.

"I believe that we would be the first public university in the country to hold the line on tuition and fees for two full years if the Governor and the Legislature join us in this effort," Karam said. "That sends a powerful message that the University of Massachusetts and the Governor and Legislature are serious about controlling the cost of higher education and easing the debt burden on our students."

Three years ago, in Fiscal Year 2009, the state and students and their families provided equal amounts of funding for the University's general education programs, the so-called 50-50 funding approach. This year, students and their families paid 55 percent and the state 45 percent.

In voting to approve the fee increase for next year, trustees noted that UMass faces $63 million in rising costs in just two areas next year as a result of negotiated contractual increases with its 10,620 unionized employees and because of increased debt service resulting from the $2.4 billion construction/renovation campaign the University has undertaken over the past decade.

Under the proposal approved by the committee, tuition and fees for in-state undergraduates will on average rise from $11,901 during this past year to $12,481 in 2012-2013. The 4.9 percent increase is lower than the average increase for other Massachusetts public institutions and is generally lower when compared to public universities in the region and the nation.

"After much internal debate and soul-searching, we are trying to steer a moderate course on this difficult issue," said UMass President Robert L. Caret.

"On one hand, I was attracted to the idea of freezing tuition and fees, but that would have forced us to make dramatic and unacceptable cuts in a range of programs to offset rising labor and debt-service costs. Conversely, we could have mirrored the near double-digit increases we are seeing in other states to more fully cover rising costs, but that would have imposed too great a burden on students and their families. We see this as the reasonable and responsible course," President Caret said.

The new tuition and mandatory fee rates are expected to receive final approval when the full Board of Trustees meets tomorrow at UMass Dartmouth.

"This is never an easy issue," Karam said. "Certainly, the easiest decision would be to never increase our student charges. But to take that course would be to consign the University to decay and decline, particularly in an era where this state, like states all over the nation, no longer funds public higher education at the level that it once did. And decay and decline is something we can never accept. We are determined to move forward, understanding that we need to safeguard affordability in a number of ways, particularly by making sure that sufficient amounts of financial aid get to the students who need aid most. We are proud to see that the University's own spending on financial aid reached record levels during this past year, and the Board of Trustees considers aid to be a top priority."

Voicing his support for the proposal, Trustee Victor Woolridge, who chairs the Administration and Finance committee, said: "There is the need to strike a balance between the needs of our students, the interests of all citizens of the Commonwealth, and the long-term strength of the University."

While the new state budget for Fiscal Year 2013 has not been finalized, the University appears to be in line to receive an additional $25 million - all of which would be earmarked for previously negotiated contract increases.

The state appropriation and student fees are the University's chief funding sources for its education programs, and the additional $25 million that UMass stands to receive from the state and the $25 million in additional fee revenue combined would not cover the $63 million jump in collective bargaining and debt service expenses. UMass will look to new efficiencies in other areas and growth in smaller revenue sources to cover the gap.

STATE FUNDING:

While the state is set to provide $25 million to cover part of the cost of union contracts, the state's share of funding for the University's general education budget is expected to drop to 43 percent in FY 2013, with students and their families funding 57 percent. Ten years ago, the state provided 61 percent of the funding for general education programs and students and their families 39 percent. State support per full-time student is expected to be $8,130 in Fiscal Year 2013, down from $10,015 per student in Fiscal Year 2008.

INCREASES IN MASSACHUSETTS AND ELSEWHERE:

Average 2012-2013 Fee Increases:

  • Mass State Universities       6.3%
  • Regional Publics                 6.2%
  • National Average                6.5%
  • UMass Peers                      7.4%

A FOCUS ON FINANCIAL AID:

UMass provided its students with a record $158 million in grant funding during the recently completed academic year - funding that comes directly from the University and is an important component in the $736 million in financial aid that UMass students received from all sources. The University's own grant funding is expected to grow by at least $5 million next year. Additionally, UMass plans to step up its student debt-counseling efforts in 2012-2013. According to the most recent financial aid report, in-state, undergraduate students had 91.8 percent of their demonstrated financial need met last year through a combination of grants and loans. Nearly two-thirds of the University's in-state, undergraduate students received need-based financial aid during the 2011-2012 academic year. Financial aid is available to families at most levels of the economic spectrum. For example, the average grant award in the $75,000 to $100,000 income range last year was $4,484.


CAPITAL SPENDING AND DEBT SERVICE:

UMass has dramatically improved the faces of all five campuses over the past decade, constructing science and research buildings, new classrooms, student recreation centers and new dormitories, as well as making progress on a backlog of deferred maintenance projects. UMass has completed $2.4 billion in construction and renovation projects over the past decade, This work has been critical to advancing its academic and research mission and has helped to drive interest in the University of Massachusetts, which is experiencing record levels of applications and enrollment systemwide. But because of the state's inability to fund capital projects for UMass at traditional levels, UMass was forced to shoulder 85 percent of the cost of this $2.4 billion building boom, leaving it with manageable but rising levels of debt service.

UMASS EFFICIENCY STEPS:

The University continues to move forward with an array of efficiency and effectiveness initiatives, taking significant steps in areas including electronic procurement, energy conservation and employing new technology to reduce administrative costs. Additionally, UMass has eliminated 645 positions over the past four fiscal years through layoffs, retirement and attrition.


Contact: Robert P. Connolly, 617-287-7073

 

6/5/12

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Robert P. Connolly
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