The idea of locking in a guaranteed tuition cost at the University of New Mexico as an option is under review by the UNM Board of Regents. Regent Bradley Hosmer proposed the static tuition as a way to help students and their parents save money over the course of obtaining a four-year degree.
The proposal essentially increases the current tuition rate by 10 percent and secures it at that same price over the course of four years. At UNM, tuition has gone up an average of six percent each year over the past four years.
Hosmer says the Regents believe that a guaranteed tuition option for students and their families should be a choice made available to them. “We suspect that some families may want to be able to plan on exact tuition and fee costs for their next years, and be willing to pay a small premium in order to get it,” Hosmer said. “If they pay more than their classmates going the usual route, the difference will be refunded, so someone selecting this option can’t lose. We’ll know later this year how many families will make take the option.”
UNM has had tuition increases of four, five and six percent in recent years due in part to funding limitations at the state level. “We have been trying to remain competitive with peers by maintaining faculty salary funding and increasing need-based financial aid, which are our top goals, so we’ve averaged over a four-year period about six percent in tuition and fee increases,” UNM Associate Vice President for Enrollment Management Terry Babbitt said.
Based on the 2013 fall tuition rate, which was $3,223 including tuition and fees, a 10 percent increase over a four-year period would have amounted to a locked-in rate of approximately $3,545 per semester or about $7,100 a year for the fall and spring semesters through 2017.
Babbitt says the guaranteed tuition option is a fairly common model. “Some states have legislated it and mandated that universities provide this option. Some states have had it for a very long time where it’s mandatory that every student participates in a guaranteed tuition structure.”
The ability to implement a tuition freeze ties into UNM’s recent decision to reduce credit hours for an undergraduate degree from 128 to 120, while also encouraging students to take at least 15 credit hours so they can graduate in four years with less debt than if it took six years.
In terms of monetary benefits, neither the institution nor the student would lose or gain any money under the scenario.
“I think the University benefits in the fact that it’s provided some certainty and security to those families that prefer the option,” Babbitt said. “There’s not a monetary benefit because the model the Regents preferred that we develop has a reimbursement factor at the end that if a student does graduate in four years, and they ended up paying more tuition than the standard rate, there would be a refund to the student as a reward that actually makes it a neutral cost for both parties so there’s not a big institutional benefit to the model.”
The UNM Board of Regents is set to consider the proposal at its annual budget summit, which is scheduled for Tuesday, March 25 at 9 a.m. in SUB Ballroom C.
If passed, the locked-in tuition rate would only be an option.