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UMass finance committee approves fee increase, says rebate is possible with federal funds

BOSTON - The University of Massachusetts Board of Trustees Committee on Administration and Finance today approved a tuition and fee increase of up to $1,500 for in-state undergraduate students, with officials noting that some or all of the increase could be rebated based on the amount of federal stimulus aid the University receives.

The committee took its action with the University facing a $102 million reduction in state funding in the upcoming fiscal year.

"This increase is designed to preserve academic quality and to ensure stability, but if federal dollars can be substituted for student dollars, we will eagerly rebate some or all of this increase," UMass President Jack M. Wilson said.

President Wilson said that the University "has an established record of restraint" on the student-charge front, noting that increases over the past five years have been less than the rate of inflation in keeping with a policy initiated when he became president in 2003. Under that policy, the University said it would keep student-charge increases at or under the rate of inflation as long as it received stable funding increases from the state.

The committee approved the proposed fee increase on a 7-2 vote, with another trustee abstaining. Additionally, the committee voted to freeze most non-mandatory fees at 2008-2009 levels.

Under the proposal, which will be up for final approval when the full Board of Trustees meets on Feb. 27 at UMass Dartmouth, tuition and fees for in-state undergraduates on average would rise from $9,548 to $11,048 in the upcoming academic year. The committee approved specific language authorizing a fee rebate based on the amount of federal funds UMass receives.

With UMass enrollment and applications at or near record levels, President Wilson said the University had "an obligation to protect quality, access and affordability."

Because of the budget cuts being felt by all state programs and institutions, the University of Massachusetts could see state funding decrease by $102 million from Fiscal Year 2009 to Fiscal Year 2010, when its appropriation reduction and the loss of state-funded employee fringe benefits are calculated.

President Wilson said that University leadership is pursing a course under which the $102 million funding gap would be closed by an infusion of nearly $50 million in new net student fee revenue and by more than $50 million in spending reductions.

To close all of the $102 million gap via budget cuts "would compromise quality at an institution where quality is on the ascendancy and that now sees soaring student interest and demand. Cutting $102 million from the budget would require extensive layoffs of faculty and staff and would also mean that student enrollment would have to decrease. At this moment, the Commonwealth needs the University of Massachusetts to remain strong and to continue to be a major engine of economic growth, while serving this increased demand from the students of the Commonwealth," President Wilson said.

Closing the entire $102 million funding gap by a commensurate increase in fee-derived revenue would necessitate a $3,100 fee increase, which President Wilson said "would unduly burden students and their families."

"Instead we have chosen the moderate path of a $1,500 fee increase," President Wilson noted.

President Wilson also told the committee that the federal stimulus bill signed into law this week will direct an additional $3.3 million in Pell Grant aid to UMass students, which will allow the University to direct an additional $23 million in grant aid to UMass students next year, with aid being available to students at all income levels.

Nearly $20 million of that new grant aid will go to in-state undergraduate students from families with incomes up to $78,500 (statewide median family income), who will see 100 percent of tuition and mandatory fee need met with grants and scholarships, after the expected family contribution required under federal guidelines.

But President Wilson noted that grant aid was available this year "across the income spectrum, which is a message we want heard throughout the Commonwealth as students and families make important college decisions in these difficult economic times."

"We will keep this same approach in place next year and make sure that aid gets to as many students as possible. So many families have questions about the availability of higher education, and we want the University of Massachusetts to provide the answer," President Wilson said.

This year, UMass students received $153 million in grant aid, with $11.3 million of that aid going to families in the $75,001 to $100,000 range, and $25.6 million awarded to families with incomes of $100,000 or more.

President Wilson also noted that the $2,500 tuition tax credit contained in the federal stimulus package "demonstrates that President Obama and the Congress are deeply committed to higher education and will benefit UMass families across the Commonwealth."

Contact: Robert P. Connolly, 617-548-0238




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