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Tuition freezes and budget math

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Illinois

* From a U of I press release with emphasis added…

In-state freshmen at the University of Illinois would see no increase in base tuition next fall for the first time in more than two decades under a proposal that will be reviewed Monday by the Board of Trustees’ Audit, Budget, Finance and Facilities Committee. […]

Officials said the University hopes to hold future tuition increases to the rate of inflation or below, but cautioned that significant reductions in state funding and other factors could lead to larger increases.

* The Tribune explains how the university will cover the costs, with emphasis added…

The university will forgo about $2.6 million in tuition revenue by not instituting another 1.7 percent increase this year, Pierre said.

However, he said, the university expects about $25 million in additional tuition revenue during the 2015-16 school year in part because of increased enrollment in some programs and higher graduate student tuition. Also, under the four-year guaranteed tuition plan, some lower-paying students will be graduating, and new students — even with the freeze — will be paying more than those they replace.

Pierre warned that this could be a one-time freeze, especially as the state’s public colleges and universities are facing threats of funding cuts after the state income tax rate dropped Jan. 1.

“Certainly any changes in state support might have consequences on tuition rates for next year,” he said.

* Keep that $2.6 million figure in mind when reading this, with emphasis added…

The University of Illinois is preparing for a possible 20 percent cut in its state appropriation.

Last week, the university was asked to submit a report to the Illinois Office of Management and Budget and the Illinois Board of Higher Education on how such a reduction would affect its operations for the next fiscal year starting July 1, 2015.

A 20 percent cut in the UI’s approximately $670 million state appropriation would amount to about $134 million.

The tuition freeze’s $2.6 million cost amounts to 0.39 percent of the system’s $670 million state approp. Any hit to its budget beyond that, and either the freeze could be imperiled or tuition will have to rise even higher in the very near future.

posted by Rich Miller
Wednesday, Jan 7, 15 @ 11:40 am

Comments

So why forgo the $2.6 in extra tuition?

Comment by Bobby Hill Wednesday, Jan 7, 15 @ 11:47 am
[snark]Bruce said he was going to increase funding to higher education, so there is nothing to worry about.[/snark]

Comment by PublicServant Wednesday, Jan 7, 15 @ 11:49 am
Let’s not use the word “freeze” today. Let’s think heat. - U of I deals with HOT Tuition issue -

Comment by Norseman Wednesday, Jan 7, 15 @ 11:51 am
It’s time for my alma mater to take a serious look at reducing its bloated overhead, get its heavily featherbedded maintenance and operations group under control, and get serious about triage in internally funded research and marginally effcetive programs.

Most aren’t aware that due to the low quality and cost of undergraduate education at U of I (mostly VERY low paid grad students who (1)have no teaching or professional experience (2) Little INTEREST in teaching and (3) often can barely communicate in English) the University is MAKING money on each undergrad. Since they don’t give merit scholarships, what they give out is more based on social engineering than scholarship.

They also need to evaluate their “special admissions” policy, which, according to the last numbers I’ve seen, has less than a 25% success (graduation) rate.

I won’t even get into the gross mismanagement of the Univerity’s athletic programs and capital plans…..

It’s time to reset the priorities of the University towards what was once its core function; educating Illinoisans in high demand fields necessary for the prosperity for the state.

Does Rauner and the UI BOT have the guts to undertake such a task? We’ll see….

Comment by Arizona Bob Wednesday, Jan 7, 15 @ 11:54 am
A pre-emotive p.r. strike by U of I. When their appropriation is reduced again, they can say they tried.

I suspect a lot of folks around the state would be happier if there were more slots available for in-state students, regardless of tuition.

Comment by Wordslinger Wednesday, Jan 7, 15 @ 11:57 am
All collages should cut cost’s their sky high. The average family needs help.

Comment by Mokenavince Wednesday, Jan 7, 15 @ 12:00 pm
After years of raising tuition at levels above the rate of inflation, its about time the for a freeze. Cut bloated administration costs is the first step in reigning in spending.

Comment by Apocalypse Now Wednesday, Jan 7, 15 @ 12:14 pm
Sure cut a lot of the bloated waste, quit trying to keep up with the Jonses (Big 10), and return to the mission of a public university.

But you’re still dealing with a long-term funding issue. Corporations/Rich People no longer are willing to pay taxes to train their future workers. It is easier just to let the student/parent take on crippling debt. The social contract is broken and it isn’t a problem unique to Illinois.

Comment by Jimmy CrackCorn Wednesday, Jan 7, 15 @ 12:20 pm
I thought they made millions in the Zaxby’s Bowl game.

Comment by norhtshorecynic Wednesday, Jan 7, 15 @ 12:22 pm
Smart move by the University.

Comment by Soccermom Wednesday, Jan 7, 15 @ 12:24 pm
@Bob, the insight you provide from Arizona about anything Illinois is amazing.

Comment by IllinoisO'Malley Wednesday, Jan 7, 15 @ 12:32 pm
@Illinois O’Malley

Yeah, O’Malley. Never learned a thing by being politically involved in Illinois for about the last 55 years, having gone to school and University there and raised three kids in Illinois.

I can see why you don’t think I’m qualified to comment on Illinois politics, though. Not being an Irish Dem excludes me from the conversation, right?

Comment by Arizona Bob Wednesday, Jan 7, 15 @ 12:37 pm
I am glad that my Alma Mater is finally making an attempt to keep its “best and brightest” at our flagship institution. For too long, the U of I has been relying on out of state tuition, foreign and graduate students to try to make its budget work. In the process many exceptional in state students ( and I suggest primarily for financial reasons ) have gone elsewhere.

It pains me to realize the significant reduction in support from the GA since I got my degrees in the early 70’s, and my brother 12 years later. My nephew is paying the price today ( more correctly, his dad ), but he always has ben determined to get his degree from the U of I.

Arizona Bob does make some valid points. We may have been in school at the same time and remember how things used to be.

With things being as they are, my 6 nieces ( all Ill State Scholars, top 10 % etc ) have gone to private colleges or out of state for their degrees, simply because of the costs at the U of I, and the financial incentives offered elsewhere.

Comment by illini Wednesday, Jan 7, 15 @ 12:39 pm
@illini

Engineering class of ‘75. I also did much of my graduate work there in the early ’80s.

Up until about 10 years ago the UI was considered one of the best tuition bargains out there for in state students. Now, with all the merit scholarship incentives at out of state schools, students can attend very good schools for less than at UofI.

We became Arizona residents when my kids went to Arizona State in Tempe. They got $6K per year merit scholarships as in-state students, and $11K if they were out of state students. My total tuition is just $4K per year each to go to one of the top supply chain business schools in the country.

They could have gone to U of I, but they didn’t like the environment or instruction quality for undergrads.

Except for engineering, most of my kids’ friends are opting out of U of I to go to Purdue, Indiana, THE Ohio State University,Michigan State and Iowa.

The “branding” of U of I is going down with the corruption scandals and word of mouth from students, and the educrats in charge seemingly couldn’t care less as long as their cushy jobs, and golden parachutes, are there.

BTW, what are the chances that Quinn will get a six figure gig at U of I as a “lecturer” for a few talks per year like his patronage driven predecessor Edgar?

Comment by Arizona Bob Wednesday, Jan 7, 15 @ 12:54 pm
Another question is, can the U of I continue to raise tuition and still be able to recruit top notch Illinois students?

Comment by Ahoy! Wednesday, Jan 7, 15 @ 12:55 pm
Keep in mind that the main reason Illinois universities have increased there tuition as much as they have, derives from corresponding, and dramatic decreases in state hard money support. At NIU today, less than one third of the University’s budget comes from state money. The remainder comes from tuition and grants of various kinds. Universities have been an easy mark for reducing state expenditures because they can charge their student customer’s to make up the difference. Should universities be more efficient and less costly, yes. But in so doing overall quality will likely suffer as universities make difficult internal cuts to balance their budgets.

Comment by equivocator Wednesday, Jan 7, 15 @ 12:59 pm
Is it a 4 year “freeze” if there’s a caveat that allows for raises next year? Won’t other classes have to pay more if their tuition is not frozen like this one? Is that fair to next class or classes and current students? Seems like a PR stunt to divert attention that it now costs over a $100K to get a college degree from the U of I (if you can get it done in 4 years). You have to wonder how NIU, SIU, EIU, WIU, etc. can keep going with college costs at these enormous prices? Maybe MOOCs will replace these campuses if they address the cost to benefit issue fast?

Comment by Davis Wednesday, Jan 7, 15 @ 1:14 pm
This U of I alum agrees with Arizona Bob. My friend’s kids are opting for Indiana, Mizzou, Iowa, Wisconsin, etc. Illinois has become less desirable even as it has grown more expensive. This trend has seemingly eluded our most recent Governors.

Comment by Keyser Soze Wednesday, Jan 7, 15 @ 1:19 pm
Keysor, I’ve got a son who’s completing his MS in May in Aerospace Eng. It’s expensive, but a top-notch engineering powerhouse. Illinois has other programs that are highly ranked, and they have two things going for it: Tuition frozen for 4 years means certainty as to what the bill will be. Direct admittance to the program of choice means you don’t have to roll the dice when you select another institution as to whether your child will gen into the program that they hoped to get into when they went there.

But I do agree that Illinois is expensive for instate middle class students, and certainly for OOS and international students, who are mainly attracted by the engineering rankings. The loss of state dollars, as previously mentioned, is a main driver of increased tuition.

Also, hiring and retaining the professors that make those programs great costs money. As for all this bloat being talked about, if it can be identified as such, then I’m all for eliminating it. Just don’t lose those professors to competitor institutions both public and private, or the U of I is toast.

Comment by PublicServant Wednesday, Jan 7, 15 @ 1:37 pm
Arizona Bob and Illini,

You have made some solid points. ‘Bob,’ I particularly agree with you comment about the low level of instruction at the UI-UC lower division level. That has been going on for decades. It’s upper division and graduate programs are first rate, however.

I would like to provide the following information.
I went back to FY 2000-01 and found that state GRF to public universities was $1,409,887,700. By 2013-14 this had declined to $1,232,192,000.

That’s right, a decline. Wonder how many other state agencies can make that claim?

Do you ever see this mentioned in the MSM or even a public statement by the IBHE or Unviersity Presidents? I don’t.

Furthermore, in November Rauner asked the head of the IBHE to consider possible budget cuts of up to 30% over the next 18 months.

Comment by Federalist Wednesday, Jan 7, 15 @ 1:42 pm
As an alum, I agree that Illinois is not what it once was and believe that the top students from in state should be given first preference. But then again, as the university is so cash strapped, I can see why their preference is for out of state/international students. Other states, who fund their educational institutions, at least better than our state can afford to offer merit scholarships. Out of state tuition at surrounding schools plus merit scholarship is equal to Illinois in state tuition. Unless Illinois has something special to offer it’s in state student, why not go somewhere else?

Comment by Anonymous Wednesday, Jan 7, 15 @ 1:44 pm
==Not being an Irish Dem excludes me from the conversation, right?==

You ever get tired of playing the victim Bob? Just curious.

Comment by Demoralized Wednesday, Jan 7, 15 @ 1:53 pm
In the article in yesterday’s Times they stated what the current tuition/room/board/fees were. Having sent a child through this fine institution, I can tell you that the numbers they reported were significantly lower than what this sap paid! lol

Comment by A guy Wednesday, Jan 7, 15 @ 1:58 pm
In addition to engineering as mentioned above, accounting is also a big program at U of I. I am a student currently deciding between U of I or University of Iowa for accounting.

Comment by Anonymous Wednesday, Jan 7, 15 @ 1:58 pm
Guy, are you saying the costs of tuition, room and board and fees have gone down at U of I? Are you sure about that? What years are you talking about?

Comment by Wordslinger Wednesday, Jan 7, 15 @ 2:05 pm
To Arizona Bob - I was BA 71 and MA 72.

Agree with you about the changes 10 years ago, but in reality the trend started earlier.

We need to push to help our Alma Mater regain the position it had in our era - a daunting task to say the least, but worth pursuing. This might help - I’m keeping an open mind and commend the Trustees for being willing to consider this option - but what help can we expect from the State?

Comment by illini Wednesday, Jan 7, 15 @ 2:28 pm
@AzBob, let me rephrase - your insight into the University of Illinois based on your undergrad experience in the 70’s and part-time grad studies in the 80’s, is amazing.

Comment by IllinoisO'Malley Wednesday, Jan 7, 15 @ 2:37 pm
To O’Malley - What difference does it make when we attended the U of I. The 5 years I spent on campus are 5 years I would not trade for anything. Yes, things were different then, but we all considered us to be privileged to be able to a attend a premier national University that our parents could afford. Things have certainly changed.

Comment by illini Wednesday, Jan 7, 15 @ 2:57 pm
@ Arizona Bob. All the complaints about “administrative bloat” do not address the fact that the state of Illinois has cut its funding to public universities. Maybe things can be done more effectively. But the most important factor affecting public education in Illinois and elsewhere is the systematic disinvestment by state governments. The Republican mantra of cutting taxes is undermining public goods like education and transportation infrastructure. You can’t fix something buy simply cutting. It takes investment.

Comment by Phlegm640 Wednesday, Jan 7, 15 @ 3:09 pm
@Illini, I went to the UI in 90’s for engineering undergrad and grad, and was a grad research assistant.
AzBob’s comments is very specific about O&M, “bloated budgets”, lack of focus etc. That’s all hogwash. Ever hear of UI Labs? Have you or Bob been to a presentation by the Dean of Engineering in the last couple years? UI is a premier institution, but the trouble is declining state dollars coupled with private school endowments increasing. Know what Stanford, MIT, and Berkeley all have in common? They have open job offers to UI faculty.
Finally, AzBob says the University has to refocus, which really shows his lack of knowledge, especially when I see videos like this: http://engineering.illinois.edu/greetings/new-year-2015.html

Comment by IllinoisO'Malley Wednesday, Jan 7, 15 @ 3:10 pm
Tuition + Fees for In-State students

U of I $15,602 – 20,606
UW Madison $10,410
Mizzou $10,286
Iowa $8,104
Indiana $10,388
Kentucky $9,816

http://admissions.illinois.edu/cost/tuition.html
http://finaid.wisc.edu/undergraduate-cost.htm
http://admissions.missouri.edu/costs-and-aid/costs/index.php
http://admissions.uiowa.edu/finances/estimated-costs-attendance
http://admissions.indiana.edu/cost-financial-aid/tuition-fees.html
http://www.uky.edu/psi/educcost.html

Comment by Anonymous Wednesday, Jan 7, 15 @ 3:24 pm
===Maybe things can be done more effectively===

Maybe???

C’mon. Zona is right for once.

Comment by Rich Miller Wednesday, Jan 7, 15 @ 3:30 pm
Again to O’Malley - without a doubt the Engineering, Computer Science ( and as someone else noted - certain Business programs ) are among the best in the country. And I agree that these programs ( judging by the success of some other relatives who have graduated in those areas ) are exceptional.

You and I are of different eras - my roommates were still carrying sliderules ( I think that is what they were called ) and one of my roommates even used an abacus. I was not in engineering or the sciences.

The U of I is - or should be - about more than Engineering or Computer Science. What about the Liberal Arts and Sciences, Fine Arts, Agriculture, Education or any other number of programs?

The University of Illinois has lost the status it had in the late 60’s early 70’s partly/largely because of the declining state funding. When I attended, state funding as I recall was close to 50% of the budget - now is it even 10%? And maybe Arizona Bob is right about some of the bloated administrative excesses, but we can not allow the costs to continue to rise and the reputation continue to decline without raising a little hell with our legislators about increased funding. Downstate, everyone I talk to, and I have a lot of contacts, whether D or R, agrees and is sympathetic and wants to do more, but that is where it ends.

The budget will be cut, costs will continue to rise and our “best and brightest” will go elsewhere!

Comment by illini Wednesday, Jan 7, 15 @ 3:53 pm
O’Malley, I’ve been very involved with the Illinois Engineering Alumni association up until recently. I interview and hire grads from there and other universities regularly, so I probably get better feedback on what’s going on there than you do.

I’ve also been on the Academic Advisory Committee to the Dean of the College of Engineering at U of I, and taught engineering classes for students who transferred there.

If you really want to get into it, how about we discuss the “culling of the heard” that U of I does to its incoming engineering students? They admit some of the most highly qualified students in the nation there, then pretty much give them such a low quality of instruction that if they can quickly learn to teach themselves with minimal assistance, they can advance to actually getting a professor who’ll occasionally show up to class as upper classman, when it doesn’t interfere with their research or consulting schedule. That’s why only 60% of the incoming freshman in engineering were able to graduate in 5 years. The university couldn’t care less about those that got sandbagged. The next incoming freshman would be happy to take their place. That’s different from engineering schools like Notre Dame which expose students to faculty earlier and have a much more nurturing academic environment.Practically NOBODY flunks out of ND.

One final note. My next door neighbor in Illinois recently graduated in computer engineering from U of I and went for his masters at Stanford. Consulting and start up opportunities just aren’t there in Illinois like they are in Palo Alto. When Stanford entices U of I hot profs, it’s because of the side consulting money and grants. It’s not salaries that have them make the move, it’s the lifestyle and other “perks”, as well as silicon valley opportunities. That has pretty much nothing to do with state funding of the university. It’s a natural disadvantage of Illinois high tech. It’s surprising that the CSci dept has been able to keep as much as it has, and it has nothing to do with Springfield funding.

The CE and Mech depts have fared pretty well, since silicon start ups aren’t competing for many of them.

Comment by Arizona Bob Wednesday, Jan 7, 15 @ 4:18 pm
I’d like to piggy back on what AZ Bob has said if we are talking about the quality of instruction at universities. I didn’t go to the U of I but I did go to another state university. I remember a faculty member in my major department that was being let go because they weren’t engaging in enough “research.” Why? Because they were actually teaching and spending time with students. We threw an absolute fit over this to the Dean but it didn’t matter. This prof wasn’t generating enough revenue so they booted her to the street. Maybe the universities could focus a bit more on teaching than being revenue generating monsters where the bulk of the revenue doesn’t make it to student instruction.

Comment by Demoralized Wednesday, Jan 7, 15 @ 4:30 pm
“In-state freshmen at the University of Illinois would see no increase in base tuition next fall for the first time in more than two decades……. ”

Maybe so but you will pay about $186 more to send your kid to Urbana next year. I think part of the increase goes to pay the interest on the bonds for the $160 million renovation of the Assembly Hall. I’m an alum, BSEE 57. Tuition my final year was $65 per semester. Tuition and fees were less than 7% of the operating budget. Today tuition pays about 24% of operations while the state pays 15%. Makes you wonder why we call it the University of Illinois.

Comment by CapnCrunch Wednesday, Jan 7, 15 @ 4:36 pm
As a U of I grad, I felt as though I was nickel and dimed all through my 4-year undergrad program and that was almost thirty years ago. I’m sure it’s worse today.

As a long-time resident of Champaign-Urbana, sometimes it seems as though the UI employed as many people as they had students. While I know this to be untrue, at the same time, I know there are a **lot** of people working (or not) for the UI.

I’d just about bet that we could slash the non-academic positions there by 50% and still maintain almost all of the core services.

And everything that’s done at the U of I isn’t modest, but rather ornate. How many tens of millions were spent to rehab Lincoln Hall? To rebuild the Six Pack dorms? Seems as though a lot of money is spent outside the core mission of the university… to educate the youth of IL.

And then there’s the issue of non-resident students… It’s almost as if the UI is more like a foreign college than the state’s flagship university of late. I know the UI is desperate for cash, but c’mon.

John

Comment by John Boch Wednesday, Jan 7, 15 @ 5:08 pm
AzBob, I am with you all the way through here: ==…and it has nothing to do with Springfield funding.==

Springfield funding (or lack thereof) is clearly a component. And, not just funding of the University, but support for a long proposed high tech corridor from Champaign to Peoria. There is no reason why the state can’t take much greater advantage of the opportunities presented. (Except financial ones.)

Comment by Pot calling kettle Wednesday, Jan 7, 15 @ 5:20 pm
For the first time, I agree with AZ Bob. UIUC ‘78 BUS ‘86 MBA.
Kids in classes of ‘08 and ‘18.

My kids are there because each had career goals that fit well into UI curriculum, close to home, and scholarships.

The College of Business has more patronage than IDOT.

Comment by Arthur Andersen Wednesday, Jan 7, 15 @ 5:30 pm
The bottom line is that we need to be willing to keep our top notch Illinois high school students here in Illinois. They need financial breaks, not kids from the other side of the world! When folks on this blog talk about people leaving Illinois, it’s because nobody seems to care if they do! Doesn’t it start with kids? Out of state highly reputable schools are very happy to get the top students that were educated here. Why doesn’t Illinois care?

Comment by Anonymous Wednesday, Jan 7, 15 @ 5:30 pm
Very good discussion on this subject, and I have contributed several times! I do have several “hot button” issues that I comment on and one is my Alma Mater.

Comment by illini Wednesday, Jan 7, 15 @ 7:43 pm
Ok, we’re finally in my wheel-house here on CapFax.
For the first time ever, I agree with something that AZBob said: “bloated overhead”. You bet. and it’s far worse than you even think it is.

But here are some bona fide facts for all of you to chew on:
As of FY14, for all Uof I campuses, state contributes 15% of total revenue, grants and contracts 17.5%, and tuition 24%. the rest is various (this does not include state payments for benefits for employees, retirees, etc., which the university is soon going to have to pay for). So I think it fair to say that the U of I is no longer a public state university, it is a university located in the state.

Some trends for UI-Champaign-Urbana only:
Tuition and fees have increased 214% from 2000-2013
From 2007 - 2014: enrollment is up 4.1%, but number of faculty is unchanged. That means UIUC “has a higher student-faculty ratio than its peer median” (UIUC’s own language).
Number of deans and assistant deans has increased by 9%
“Average faculty salaries are 1.2% less than peer median”

These numbers are verifiable and I can provide the sources.

Comment by Filmmaker Professor Thursday, Jan 8, 15 @ 12:18 am
The last time I looked at the Uninversity budget a few years ago only 40% of expenditures went to “instruction”, and there was one employee for every three students.

It would be interesting to look at the economics of the U of I medical schools and West Campus facilities. How could we find out how much of the University resources are spent providing healthcare at below cost in the West Side Medical facilities? Perhaps it’s time for the University to get out of the Healthcare business, unless they can figure out how to do it profitably like the U of Chicago system.

Comment by Arizona Bob Thursday, Jan 8, 15 @ 7:59 am