Economy, declining tax revenues raise tuition prices

Posted: Wednesday, November 06, 2002

A study released Monday says declining tax revenues and the overall malaise in the economy caused college tuition and fees to increase an average of more than 5 percent for both two- and four-year institutions this school year.

Figures released by the nonprofit College Board, best known as the owner of the SAT college entrance exam, show that tuition and fees at four-year public institutions now average $4,081, a rise of 9.6 percent over last year.

''As tax revenues decline, public colleges have searched for other sources of funding and for many, that has led to tuition increases'' said Gaston Caperton, president of the College Board. ''But despite this year's increases, public colleges and universities are still a remarkable value.''

State schools aren't the only places costs went up.

Tuition and fees at four-year private colleges rose an average of 5.8 percent to $18,273 for this year.

A 7.9-percent increase at public two-year schools caused tuition and fees to rise to $1,735, while students at private two-year institutions experienced a 7.5-percent increase to $9,890.

Phillip J. Alletto, vice president for student development and enrollment at Westminster College in Utah, said the tuition increases passed on to students over the past few years have not necessarily offset increased costs for colleges to do business.

''It gets trickier and trickier as time goes on'' for schools to find money to pay for increased liability insurance, updated technology and travel expenses, Alletto said.

Still, he said the figures do not signal the end of affordable higher education.

''I guess I'm an optimist, but I believe we'll find our way through this like we did during the economic problems of the 1970s and the enrollment decreases in the 1960s,'' Alletto said.

''I think what happened is that everyone became too fat, dumb and happy in the 1990s when family income was up and we had donors with too much money to give away. Now we'll have to buckle down.''

The College Board said that a record $90 billion in student financial aid -- including loans -- was handed out during the 2001-2002 school year, a boost of 11.5 percent over 2000-2001.

The report also said that 54 percent of student aid came from loans last year. A decade earlier, loans accounted for 47 percent of student aid.

Grants comprised 39 percent of the aid provided to students, a decline of 11 percent from 1991-1992.

Caperton urged parents and students not to be discouraged by the figures. He said families need to weigh the cost of tuition against the long-term earning potential of a college degree.

The College Board estimates that over the course of their careers, college graduates can expect to earn $1 million more than high school graduates.

The board is a national membership association composed of more than 4,200 schools, colleges, universities, and other educational organizations.



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