No Increase in Tuition–Our Risk

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Yesterday Fresno Pacific University announced that it would not raise tuition levels in any of its programs for the 2010-11 academic year.  This is the first time that we have not raised rates in 30 years (that’s as far back as we checked).  We, of course, cannot “collaborate” with other universities on this kind of a decision so we don’t know what others are doing.  That might be considered price-fixing. 

The administration proposed no increase to the Board of Trustees last weekend.  They approved it without dissenting votes, and with what appeared to me to be firm conviction that this is what we should do.  It was a bold move for the Board.

For the news story see http://www.fresnobee.com/updates/story/1688501.html

I would guess that most other universities will raise their rates at least minimally, as we have in the past for a couple of reasons. 

First higher tuition signals to the market place higher quality. Education “consumers,” contrary to what might be thought, do not always choose the lowest price option.  They only buy once, or at least seldom, and they think about what university’s name they want on their resume, what university they want to be associated with, where they want to be an alum.  It is often about prestige, name, and academic tradition.  This makes sense practically when the second reason is added.

Second the demands of the market are intense, even in a down economy.  Students expect wireless access, a rich set of resources, online if possible, up-to-date facilities and labs, academic specialists, comfortable classrooms, extra-curricular activities, counselors, and a Starbucks-quality coffee shop on the campus (we have one, and all the rest).  Without these and other amenities, they go elsewhere. 

So the tuition costs go up–for the last twenty years, above the cost of living indices. 

No matter what the tuition level, every not-for-profit university I know of has annual fund raising campaigns to help with buildings, scholarships, and student programs that cannot be funded from tuition.  Tuition never covers the cost. This year, despite generous donors, fundraising has been tough. Our donors know our commitment as a Christian institution and to the success of our students, and they have stuck with us.  But we all have faced losses.

We chose to limit our fees, despite these pressures, because of the economic situation students and families are facing, especially here in the Valley, where most of our students reside. We have worked with many, many students this year facing economic difficulties, helping them with additional scholarships or assistance has they have sought other forms of aid.

The pressures on our students and their families right now are intense.  The pressures to fund what the market demands are intense.  This is our risk.  Will students sense that they can get the quality they demand if we do not raise tuition–if we are lower than other similar schools?

Our ongoing task is to show the quality of an FPU education in the most direct ways we can–graduation rates, students receiving jobs after graduation, employers who look for FPU grads, those who become leaders in their professions, communities and churches, grads who represent the commitments and values we teach, and who get into top ranked medical or graduate schools (we have two at Yale right now).  It is easier to do when your tuition is higher.

It is a difficult market, an interesting profession, and a strange world.

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