Flat, Fixed-Rate Tuition Helps Colleges Attract Students

In the 2012-2013 school year, about 320 colleges and universities offered flat-rate tuition, according to the U.S. Department of Education data analyzed by the National Association of Student Financial Aid Administrators. Those schools represent about 6.7% of the country’s nearly 4,800 institutions that offered federal financial aid.

The fixed-rate tuition is a guarantee that students will pay a single rate for four or even five years. George Washington University, University of Kansas and Columbia College in Missouri all offered flat-rate tuition programs to help families pay for college without worrying about a price increase, writes M.L. Johnson of Associated Press.

In Wisconsin, Northland College, a small liberal arts school known for its environmental focus, joined a growing number of schools offering fixed-rate tuition. The college will require freshmen to pay no more than $30,450 in tuition next year.

According to the College Board, tuition and fees at four-year public colleges increased 27% in the past five years and fees at four-year private schools rose 14%. Many fixed-rate plans are combined with a commitment to hold financial aid steady so students have a firm cost estimate, but they are not discounts.

In Kansas, freshmen will pay more than standard tuition in their first two years to offset lower rates in the last two. Other schools try to estimate expenses and inflation and set rates that cover costs when averaged over four years. Generally, transfer students pay tuition for the year they enter. In Kansas, transfer students pay standard tuition.

Students said that the programs help them hold down costs by allowing them to budget wisely and borrow less.

“I can’t think of any other major expense where a student or their family is expected to commit to such a large expense without knowing what it is going to cost,” Jane Mahoney, a recent graduate of the University of Kansas, said. “I think the tuition agreement puts a lot of students and families at ease when figuring out how to fund a college degree.”

As graduates struggle with debt and weakened job prospects, many schools have been reconsidering their costs. Some schools have frozen tuition, while a small number of schools has reduced rates 20% or more in heavily publicized “tuition resets.”

Even without those moves, few students at private schools have been paying full freight. Most schools offer scholarships to lure students with attractive grades, athletic skills or other talents. Post-recession, that aid has increased at private schools more quickly than tuition, said David Warren, president of the National Association of Independent Colleges and Universities.

Like many other schools, Northland College in Wisconsin has decided to offer a guarantee that students who meet certain academic and income criteria won’t pay more in tuition than they would pay at the flagship university in their home state. That amount in Wisconsin is $10,400 in tuition and fees charged by the University of Wisconsin-Madison.

Tuesday
12 24, 2013
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