IUP's Tuition Increase, Part 1

I retired from Indiana University of Pennsylvania (IUP) in 2007 and I no longer live in Indiana. I haven't sought any inside information to help explain the recent changes in tuition at IUP or predict their effects. This is, for the present, an outsider's viewpoint.

IUP is making several changes at once, possibly in the hope of confusing students and the public about their actual effects:

1. The current flat fee of $6820 per year for all full-time students carrying between 12 and 18 semester hours of academic credit is being replaced by a fee of $284 per credit.
2. This amounts to a substantial tuition increase for most full-time students.
3. To ease the pain, IUP is offering tuition “discounts” of 7%, 4% and 1% during the first three years.
4. They also promise to increase financial aid by $2.5 million this Fall.

These changes are described as a “pilot program,” the effects of which will be evaluated after three years. It should also be noted that a second shoe is scheduled to drop this summer, when the State System of Higher Education (SSHE) announces the 2015-16 tuition at the state-owned universities. All the data in this article assume that there are no further increases in tuition, but this is unlikely. 

What is the purpose of these changes? The IUP administration anticipates that these tuition manipulations will bring in an additional $8.2 million next year. According to IUP's queen of doublespeak, Michelle Fryling, they are “part of a three-pronged approach to get to budget stability and to be able to offer the programs with excellence that we need to offer, that our students need and our students deserve.” The other two prongs are limiting campus budgets to the previous year's amount (that is, not adjusting them for inflation), and encouraging programs to increase their enrollments (without increasing their staff). It's not clear how any of these three actions will promote “excellence.”

Newspaper articles contain conflicting reports about the cost to students of the tuition increase. The figures differ depending on the academic year, the student's course load, and even on whether numbers are rounded up, down, or not at all. Let me try to clarify what is happening. A student needs at least 120 credits to graduate. Over four years, that amounts to 15 credits, or five 3-credit courses, per semester. Most students can't take exactly 15 credits each term, because most programs require some four-credit courses such as science labs. However, we can assume that 30 credits per year is the average load. Under the current system, tuition is $6820 per year. When the new system takes full effect in 2018-19, the cost for 30 credits will be $284 times 30, or $8520, an additional $1700 per year, or a 24.9% tuition increase.

Factoring in the “discounts,” the tuition increases should average 16.1% in 2015-16, 20.0% (over the current amount) in 2016-17, and 23.6% in 2017-18. These are the largest tuition hikes since there was a 15.4% increase in 1991. Of course, it's obvious that one purpose of the gradual phase-in of these increases is to discourage current students from protesting. By the time the full increase takes effect in 2018-19, those students will face a fait accompli.

Not all students take 15 credits each semester. The top chart from the Pittsburgh Post-Gazette shows how many credits per semester students actually take. The most frequent choices are 15 and 16 credits. The bottom chart is based on the 2015-16 tuition, with its 7% “discount.” It underestimates the eventual cost to students in 2018 and beyond. (Even though the Post-Gazette editorialized against the tuition increase, it failed to confront readers with its full effects.) For each number of credits, the chart indicates whether tuition will go up or down and by how much. The break-even point, at which students' costs remain the same as they are now, is 12.5 credits per semester. At that rate, it would take five years to graduate. The more credits students take between 12.5 and 18, the bigger the financial hit they will take.

As noted, IUP also announced an increase in financial aid in the Fall, equal to about 30% of what they hope to gain from the tuition increase. It's not clear whether these increases in aid will be permanent or whether they will be phased out like the “discounts.” There are two types of aid, based on need and performance. The rules for awarding this money are complicated enough that IUP's press release and an Indiana Gazette article based on it devoted more space to the financial aid package than to all the other changes. But the most most a student can hope to obtain in new financial aid is the cost equivalent of two credits. You can look up the details if you're interested, but I suspect that the very complexity of these rules is part of an administration strategy to distract our attention from the far more important—and probably permanent—changes in tuition.

This post is continued in Part 2.

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IUP's Tuition Increase, Part 2