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US bid to keep tabs on tuition irks colleges

Schools object to proposal to rank their cost increases

WASHINGTON -- Colleges are accustomed to being ranked on the basis of everything from the quality of their libraries to the vibrancy of campus party scenes. But a proposal to have the federal government compare schools by how much they increase tuition has administrators and higher-education groups objecting.

Such a ranking, proposed as part of legislation to renew higher-education programs, would require public and private colleges to report their tuition and fees annually to the US Department of Education. The federal agency would then assign each school a ''college affordability index" based on the rate of increase, and make the information public.

If tuition rose at more than double the rate of inflation over a three-year period, schools would have to submit detailed reports justifying the increases, and could face the risk of a government audit.

Congressional backers of the provision in the House version of the bill maintain that college tuition has spiraled out of control in recent decades and that pressure from the federal government is necessary to force schools to cut costs.

''When the federal government is spending tens of billions of dollars on higher education, and we're asking for a little accountability, then there's no reason why these schools can't provide us with information about why their tuition and fees are increasing," said Vartan Djihanian, a spokesman for Representative Buck McKeon, Republican of California. ''If a college or university is receiving federal aid and their tuition and fees are continuing to skyrocket at hyperinflationary rates, then students, parents, and taxpayers deserve to know why."

McKeon, chairman of the House higher-education subcommittee, made the proposal after initially calling for cutting off federal funds to colleges that did not restrain tuition increases. He scaled back that controversial proposal to a less direct approach. McKeon contends that rising tuition rates keep too many low-income students from pursuing a college education.

But colleges still object. They say McKeon's plan is simplistic because it does not take into account other financial factors, such as the amount of state aid to colleges, scholarships to students, or the quality of the education. Harvard University's director of state and federal relations, Kevin Casey, called it an ''arbitrary index."

Despite what they see as statistical shortcomings, some administrators do fear that an unfavorable index could hurt a college's image in a competitive market.

''They're worried about it from a PR perspective," said Donald Heller, a senior researcher at Pennsylvania State University's Center for the Study of Higher Education. ''If the Department of Education publishes a list every year, it's going to generate more news stories and more attention."

Other schools said that with a proliferation of rankings being put out by publications such as US News & World Report, the last thing they need is another one from the federal government.

''Every index, every listing is something we pay close attention to because it does impact people's view of the institution," said Kelly Smith, dean of students at Alaska Pacific University, a private school that has had large tuition increases. ''I'd be very much concerned about federal legislation that ranks tuition increases."

But backers of the index maintain that exposing colleges as price-gougers may be the only way to make them control tuition hikes. Supporters have argued that many tuition increases stem from schools taking significant amounts of federal aid for granted or spending too much on expensive amenities, such as luxury dorms.

Schools, however, say they fear the index will misrepresent them, or that other institutions will report less than they actually charge.

Fred Friedrich, controller at the University of Texas at Austin, where in-state tuition and fees went up 45 percent over the past three years, said increases are only part of the story.

In 2003, the Texas Legislature decided to let public universities set their own tuition to offset state budget cuts, as long as they reported more financial information to the state. But schools vary greatly in the way they define tuition and fees, Friedrich said.

Friedrich worries that creating a federal index would only increase bureaucratic paperwork for schools as they struggle to explain their decisions. UT-Austin has been through two state audits in the past three months, he said.

''It may put pressure on institutions that really try to take the high road and explain how they're doing everything," Friedrich said. ''It was very difficult for us to summarize those differences in a comparable way even in the state of Texas, so if you extrapolate that to across the country, it could get very complicated."

Some administrators at public schools also worried that the index does not take into account fluctuations in state funding. They cited studies showing that declining state aid is the primary driver of tuition prices and said they worry their schools could be saddled with unfavorable rankings if legislatures suddenly cut funds.

In Massachusetts, for example, the Legislature slashed tens of millions of dollars for higher education between 2000 and 2003, with the cuts falling most heavily on University of Massachusetts campuses. Since then, the Legislature has restored some, but not all, of that money. At UMass-Dartmouth, where tuition rose 51 percent over three years, John Hoey, an assistant to the chancellor, said the Legislature was to blame.

''It's important to view changes in tuition in some real context," Hoey said. ''At UMass, if you take the trend over the last 10 years, as the state increases funding, the university has either frozen or actually cut tuition when few universities -- public or private -- have done the same thing. But when state funds were cut dramatically, the university has had to raise fees to make up for that gap."

Private schools, meanwhile, have taken issue with the index for a different reason: It does not consider the amount of financial aid a school provides. Although the price of a private-school education often tops $30,000, many schools provide generous merit- or need-based aid. At Harvard, for example, families that earn less than $40,000 per year do not have to contribute anything toward tuition and fees, which total $41,675 for the coming year.

''We continue to have concerns about this one-size-fits-all approach," Casey said. ''It's based on an arbitrary index and it's not targeted to actual costs that build in the institutional investment in financial aid."

McKeon and others say the affordability index does not force colleges to make changes, but it does give parents and students an important piece of information.

The House version of the bill was approved in committee in July and likely faces action in the House next month. A Senate subcommittee is currently considering similar provisions as it drafts its version of the Higher Education Act, said education subcommittee spokesman Craig Orfield.

Michael Thomas, who directs policy and research at the New England Board of Higher Education, urged families to use the index wisely and keep in mind that it does not say everything about a college's worth.

''The bottom line is that it's one more data point that students can take into consideration," Thomas said. ''But, like all the other data points out there, understand where it's coming from."

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