Albion College is home to many fun and honored traditions: painting the rock, Elkin Isaac, Greek Week and Day of Woden. But there is one tradition in particular that most students dread during spring semester, and this year was no exception. Around the turn of the semester many students received a small but important letter from the college. This letter, of course, informed the students that tuition would be increasing for the 2017-2018 school year.
Like every year, students had questions about these increases. With enrollment on the rise, why does tuition increase instead of decrease? Why don’t scholarships increase with tuition? The Pleiad had the opportunity to sit down with Vice President of Finance and Administration Jerry White to address some of the most frequently asked questions from students.
Now let’s lay the groundwork. Next year Albion’s tuition will be increasing 4.9 percent in both tuition and room and board. For the 2016 to 2017 academic year the price of attending Albion College was, according to ACIS, $54,150. For the 2017 to 2018 year this has been bumped up to $55,260 from this almost five percent increase.
The first question that the Pleiad wanted to address was a rumor swirling around campus about a five percent tuition increase every semester moving forward, and White was quick to squash that idea.
“That’s absolutely untrue,” said White. “We currently do an annual tuition increase, and I won’t tell you [a semester based tuition increase] would never happen in the future, but that’s not the way Mauri Ditzler nor I consider things.”
So, rest safe knowing that a five percent increase will not be happening to tuition every semester moving forward. And it doesn’t seem as if something like that is likely to happen for the next few decades.
But, what do those tuition increases actually go to every year? And why does tuition need to increase annually?
According to White, it was a multitude of reasons, the primary being that since the 2008 recession, Albion College has been running at a deficit. When the recession hit, Albion’s enrollment fell from almost 2000 to around 1200. When this happened, Albion’s faculty made the decision to not force students to “pay the price” as White said, students might have paid the price in essentially two ways: One was that tuition would kick up all at once in order to cover the loss of students, but the college was afraid this sudden hike would only drive down enrollment even more. The other way students could pay the price was if faculty and staff were cut so low that the quality of education suffered as a result. Albion wanted to avoid these situations and chose to instead “power through” the recession.
Because of this decision, the college now runs at a deficit, which White explained to the Pleiad.
“We call it inter-generational equity that we pull out of the endowment,” said White. “This year it’s in the high five millions, we’re pulling an additional 5.8 or 5.9 million out of our endowment than what we should be.”
White said it’s standard practice for a college to pull five percent annually from its endowment. So if college has an endowment of 100 million, the school would pull five million from this endowment to help cover the operations cost that year. But in Albion, the school is pulling an additional five million out of the fund on top of the usual five percent. This means that the college is pulling more from its endowment than it should, and donors to this endowment don’t necessarily want their money going to cover a deficit at the school.
“Right now we’re working on reducing it because the people giving that money realize there’s got to be some rainy days, but if you keep pulling from it eventually those rainy days have to stop,” said White.
The college is trying to fill that gap of the deficit by not only increasing enrollment but also increasing tuition annually. Another reason for the increase that White cites is both inflation, particularly the increased yearly price of the college’s health insurance, and the need to increase the salary of staff and faculty in order to maintain the “human capital” at the college.
These increases are essential to keep the college running, according to White. And even though enrollment at Albion has been on quite the rise over the past two years, it still isn’t enough to cover those deficit costs.
“With the increased enrollment, we’re still next year going to be be running deficits,” said White. “We’re still probably going to be running deficits hopefully for just the next three to five years and they’re gradually coming down due to both the increase in tuition plus the increased numbers.”
But, many students wonder why their scholarships don’t increase with tuition over the years, in effect making the scholarships less effective as the price of Albion increases every year. White had an answer for that, even if it’s not the one students always want to hear.
“The easy answer is if scholarships went up in relation, then there’s not too much of that revenue that’s going to be gained from year to year,” said White. “Mauri shared this with Student Senate, that basically colleges somewhat have a broken model. It’s not just Albion, it’s colleges as a whole – if I could figure out how to make this work then I’d go on a circuit.”
White said that Albion could essentially “grandfather in” tuition–meaning the price you pay at the start of your first year would be the price you pay all four years. But, in order to maintain that system, White says that the tuition increase every year would be much more substantial than the 4.9 percent students will be paying for the 2017 to 2018 school year. This jump, which could be upwards of 10,000 a year could potentially scare off potential students from enrolling in Albion. So the college decided that it wasn’t the right system for Albion.
Another rumor the Pleiad addressed in our interview with White was if the value of scholarships would be increasing for incoming students for the 2017 to 2018 school year. White confirmed this rumor as truth. Incoming students, when they are awarded the Presidential scholarship will be receiving more money than current students did when they got their financial aid awards. White says this is because those incoming students are paying more up front of their four years here to start with, and that this raise increase the likelihood that students will be financially stable enough to remain at Albion for all of undergrad.
White also said that need-based scholarships are subject to increase if a student’s financial situation changed from one FAFSA to another. Students also have the opportunity to earn more aid each year through departmental scholarships offered in all of the different majors and minors.
So lastly, we wanted to know how Albion stacked up in comparison with other schools similar to us in terms of tuition increases. White said that anywhere from three to five percent was very average and normal for small private colleges. This means that Albion is pretty comparable with other small schools in terms of our tuition increases, if a little on the high end.
While the topic of tuition increases doesn’t always leave the best taste in students’ mouths, White was extremely forthcoming and transparent about this information. While it’s not always easy for a student and faculty member to talk about these changes, White was helpful enough to clear up some confusion in terms of what students ask the most. If you have any more questions about tuition you can reach White at firstname.lastname@example.org.
Photo by Katherine Buzan