Board of Governors debates tuition increase cap

The UNC-system Board of Governors are back where they were four years ago — trying to make tuition rates as predictable as possible for students.

Before President Erskine Bowles created a tuition plan in 2006, there were no limits on tuition increases and universities had no framework for using the revenue gained from tuition increases.

But a provision in the N.C. General Assembly this summer deviated from the plan and made the tuition policy revert back to uncertainty. It allowed universities to make supplementary tuition hikes of up to $750 to offset budget cuts.

With stimulus funds running out and the UNC system consistently being forced to slash its budget, administrators say they can’t cut anymore, and tuition hikes might be their only resort in the upcoming years.

So to avoid future sudden hikes in tuition, the board is reviewing the cap on resident-undergraduate rates to give universities more room to increase tuition in years of decreased state funding, said UNC-system Chief of Staff Jeff Davies.

A task force created by the board recommended that universities be allowed to increase tuition for resident undergraduates by up to 10 percent in years when state appropriations are well below average, Davies said.

A cap of more than 10 percent would not be considered because it would put universities under a federal watch list, he said. The current cap is set at 6.5 percent.

Updating the tuition plan to increase that cap to 10 percent will give universities flexibility while staying within a limit, said Charles Maimone, vice-chancellor for business affairs at UNC-Wilmington, who was on the task force that made recommendations.

“Ten percent is high and certainly we don’t want to increase tuition that much,” Maimone said. “These are extraordinary situations.”

But Davies said the board might not change the cap by that much, even in extraordinary situations.

“What I heard in the room that day was a sentiment that was not looking favorably at that recommendation,” he said.

John Davis, a member of the board, said it’s too early in the process to know the likelihood of the cap being approved.

“There are some board members more willing to raise tuition than others,” Davis said.

The board will make its decision by the end of the year, before president-elect Thomas Ross takes over.

Ross, elected last week, did not give a specific plan for tuition when asked following the announcement of his selection.

Julie Rice-Mallette, financial aid director at N.C. State University and another member of the task force, said if the 10 percent cap is adopted, the board needs to make sure the system continues the commitment to need-based aid.

The tuition plan currently requires 25 percent of the revenue gained from increases to go toward need-based aid.

UNC-CH Board of Trustees Chairman Bob Winston said he is unsure of how the increase in cap could affect the University.

“I don’t think there’s been enough discussion yet to give the Board of Governors feedback and how we feel about it,” Winston said.

Contact the State & National Editor at stntdesk@unc.edu.