UNC-system peer study to include review of tuition rates

An education at a UNC-system school has traditionally been considered a bargain.

Universities have kept tuition rates comparatively low and relied on state funding to maintain academic quality, while other public institutions and university systems nationwide have shifted to a higher tuition model.

But universities in the state might soon begin to adopt tuition rates in line with their peers.

Members of the UNC-system Board of Governors will review a new list of peer universities for each UNC-system school today.

Board members approved a new tuition and fee plan last year, which sets guidelines for tuition increases for the next four years. The model maintains a 6.5 percent cap on tuition increase proposals.

The plan provides wiggle room for universities to propose an increase that exceeds the cap if they “demonstrate that tuition revenues are the only viable source of funds for addressing the need.”

It also requires campuses to keep tuition and fee rates within the bottom quarter of their peer institutions.

But universities could propose a tuition increase above the 6.5 percent cap and still remain within the bottom quarter of their peers.

David Perrin, provost and executive vice chancellor at UNC-Greensboro, said campuses will consider peer tuition rates before proposing tuition increases to the board next year.

“Virtually every campus in the system is in the lowest quartile against its peer institutions,” he said. “While we hate to raise tuition at all, tuition in the state of North Carolina continues to be a pretty good bargain.”

Hannah Gage, chairwoman of the board, said board members will first look to UNC-system President Thomas Ross’ recommendations before making any decisions about campuses’ tuition increase proposals.

After advising against a supplemental tuition increase this summer, Ross said the peer review would provide universities concerned about the loss of academic quality after state funding cuts — such as UNC-CH — with an opportunity to bring tuition rates in line with their peers.

The UNC system has absorbed more than $1 billion in state funding cuts in the last five years.

Gage said universities would need to jump several hurdles before a tuition increase above the 6.5 percent cap would be approved.

“We are open, because we understand the hardship that the budget cuts have placed on the campuses,” she said. “But … staying in the bottom quartile will be critical. The other part is, are they meeting their need-based financial aid?”

The state budget enacted this summer included a 15.6 percent cut of $414 million for the UNC system and a $35 million decrease for its need-based financial aid program. As a result, 6,000 students did not receive aid through the program this year.

“I certainly wouldn’t rule it out,” he said. “But given the conditions now in the economy, it would really take a significant reason to get me to look at a tuition increase in excess of 6.5 percent.”

The state’s economy has also been a sticking point for university administrators who say it’s important to frame the peer study within the state’s local conditions and history. A clause in the state’s constitution says a public university education should be free for state residents “as far as practicable.”

Jon Young, provost and vice chancellor for academic affairs at Fayetteville State University, said peer institutions enable universities to benchmark their progress for retention and graduation rates and faculty salaries — but it might be best to handle tuition separately.

“When it comes to the specific question of tuition … we probably need to look much more closely at our current situation and local situation more so than looking at the other peers,” he said. “The impact of the economic crisis has hit different states in very different ways.”

Gage said the median income for families in the state hasn’t increased in 30 years, meaning tuition now comprises a larger portion of a family’ budget.

“If you want to be a public institution, you can’t take the public out of it,” she said. “There is a point where tuition becomes so high that North Carolina families are no longer included.”

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