THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Monday, February 12, 1996 TAG: 9602120048
SECTION: LOCAL PAGE: B1 EDITION: FINAL
SOURCE: BY PHILIP WALZER, STAFF WRITER
LENGTH: Long : 162 lines
Gov. George F. Allen has limited annual tuition and fee increases to the rate of inflation year by year since he was elected in 1993. Now he wants to make it permanent policy.
Deep in his budget plan lies a barely noticed section to require colleges to issue ``tuition contracts,'' guaranteeing students that tuition and fees won't increase by more than the rate of inflation for every year they are in school.
The contracts would be in place beginning this fall and would last at least through the year 2000. But the administration hopes the contracts would be extended by future leaders and become fixed in state policy.
Analysts say it would be the most restrictive measure in the nation to curb college costs. But Allen said the commonwealth's taxpayers deserve a break after the big tuition increases of the early '90s, which made Virginia college diplomas among the most expensive in the country.
``The first thing I wanted to do when I came into office was to stop the skyrocketing increases,'' Allen said last week. ``. . . It was getting so that only the wealthy elite could afford to send their children to college. This is one way to make it affordable for middle-class citizens.''
The proposal is a sure winner among students and parents, who have long complained about soaring fees. ``I can't imagine anyone disagreeing with it,'' said Theresa Germano, a senior majoring in biology at Old Dominion University. Germano said the tuition limits could help students afford to take more courses and graduate more quickly.
Yet it's not certain to pass muster with legislators, who must submit their revised budget plans this week. Some worry that the measure would put colleges in a financial stranglehold, especially if another recession hits Virginia.
``We can't solve the problem with tuition caps alone,'' said Sen. Stanley C. Walker, D-Norfolk, co-chairman of the Senate Budget Committee, who fears that the contracts would limit colleges' autonomy. ``You've got to do it by giving colleges and universities more money - way beyond what is now in the governor's budget.'' Allen has proposed a $105 million increase in aid to colleges in 1996-98, but college supporters are lobbying for an additional $340 million.
Allen acknowledged that ``it's not going to be easy'' to win legislative support: ``There are those who found very little to object to about these 12 and 14 percent increases every year. They just wanted to get as much money as they could out of students. That's a mindset that's prevalent among some segments of higher education and some supporters.''
But he added: ``We need to remember who the education is there for. It's not for the establishment; it's for the students.''
To counteract budget cuts totaling 20 percent in the early '90s, Gov. L. Douglas Wilder gave the state's colleges permission for sharp tuition increases. For three years, from 1991 to 1993, the average increase ranged from 9.0 percent to 12.5 percent.
The average annual cost, in tuition and fees, for a Virginia undergraduate now stands at $3,949. Among doctoral universities, Virginia's rank is the eighth most expensive in the nation. For nonresearch four-year schools, Virginia is second most expensive, behind only Vermont.
Since Allen took office, he has annually won approval to cap tuition increases at 3 percent for in-state students for the 1994-95 and current school years. His proposal for contracts would go even further. Here is how it would work:
Colleges could set any rate for each incoming freshman class. But they would then be bound to limit subsequent increases for those students to the inflation rate, which has hovered near 3 percent in recent years. As a result, a college could be juggling four fee schedules simultaneously.
The plan says the contracts would apply through the 2000-2001 school year, but Allen hopes it would be renewed by subsequent administrations.
The policy follows a national trend to scale back tuition increases, in the face of public disgust with skyrocketing costs. But Allen's plan is ``certainly the most restrictive one I'm aware of,'' said John Hammang, director of state and campus relations for the American Association of State Colleges and Universities.
David W. Breneman, dean of U.Va.'s Curry School of Education and a researcher on college financing, agreed: ``I can't point to a single case of a multiple-year proposal like this. Usually, you're lucky to get a state to do it year by year.''
In California, Gov. Pete Wilson has proposed the second straight year of tuition freezes but has not ruled out a return to 10 percent increases in 1997-98. Lt. Gov. Gray Davis, unsatisfied with Wilson's plan, is pushing for a ballot initiative to require a three-year freeze.
Virginia has also considered a freeze. The State Council of Higher Education, which oversees colleges, had recommended that Allen hold tuition levels steady for the next two years, but state Education Secretary Beverly H. Sgro said that would have left the schools with too little money. The state council also supports the contracts.
Last year, Michigan State University began issuing its own ``tuition guarantee'': Annual increases will be under the rate of inflation - if the state approves annual increases in funding to cover inflation. It's the absence of that second condition in Allen's plan that worries college leaders.
``I think there's a case for slowing the rate of tuition increases,'' Breneman said, ``but a four-year cap without any guarantee of a state funding pattern is kind of a sucker deal for the universities.''
James V. Koch, president of ODU, said: ``I think the principle makes sense, but I think this particular application does not. There is a possibility that in the future, we might be facing the tuition cap and have critical (fiscal) problems, and we wouldn't have any ability to adjust. . . . I see theO potential for real agony out there.''
Hammang, the director of the college association, said Allen's plan would be palatable if it included the promise of funding increases. But Sgro said that would tie the hands of future legislators and governors.
Allen says the colleges' fears are unfounded. He said he planned further increases in college funding during the rest of his term. ``It's implicit that if you have these (contracts), the state has an obligation also,'' he said. ``It's not that you tie them to a contract and jettison all funding.''
Even if funds became scarcer, Sgro said, the plan provides latitude because colleges can set any rates they wish for each freshman class. The schools' experiences in restructuring also will make them better able to manage financial problems so they won't have to resort to tuition increases.
Germano, the ODU senior, said universities can find plenty of sources of money other than students. ``A lot of money is being wasted by colleges,'' she said. At Old Dominion, Germano said, too much is being spent to improve the campus' appearance.
Some college administrators, including Koch, also have complained that the tuition contracts could turn into an administrative nightmare. ODU already has several different fee schedules - for part-time students, full-timers, students in its distance-learning program, students at its satellite centers.
But Sgro dismissed that point, saying the colleges ``all have very, very sophisticated computer programs. I don't think that's a major stumbling block.''
Allen's budget discourages tuition increases in 1996-97, but colleges would be allowed to rise to the rate of inflation. Because the state's 1996-98 budget is undecided, some college officials say it's too early to predict strategies. But Koch said ODU may freeze the rate for in-state undergrads in 1996-97.
Virginia Tech, on the other hand, probably will stick to an increase matching the rate of inflation. ``We could use that added revenue, and I don't think it's an excessive burden to lay on the students,'' President Paul E. Torgersen said.
Tech last year instituted its own pledge to keep tuition increases at the rate of inflation, and Torgersen said he hopes to continue it. Unlike some of his colleagues, he isn't worried that the tuition contracts will squeeze the schools. With the current pro-college mood in the General Assembly, ``I tend to be optimistic,'' he said. ``We're not going to get all the money we'd like to get (from the state), but I think we're going to get support, at least for the foreseeable future.'' MEMO: Staff writer Warren Fiske contributed to this story.
ILLUSTRATION: THE GROWING COST OF COLLEGE IN VIRGINIA
GRAPHIC
JOHN EARLE/The Virginian-Pilot
[For a copy of the graphic, see microfilm for this date.]
SOURCE: State Council of Higher Education
NOTE: Average annual tuition is for in-state undregraduates.
THE HISTORY
To counteract budget cuts totaling 20 percent in the early '90s,
Gov. L. Douglas Wilder gave the state's colleges permission for
tuition increases. For three years, from 1991 to 1993, the average
increase ranged from 9.0 percent to 12.5 percent.
Since Gov. George F. Allen took office, he has annually won
approval to cap tuition increases at 3 percent for in-state students
for the 1994-95 and current school years.
KEYWORDS: COLLEGE TUITION by CNB