2013-14 and 2014-15 Tuition and Fee Recommendations

Special Meeting of IU Board of Trustees
Campus Center
Indiana University-Purdue University Indianapolis
Indianapolis, Indiana
June 5, 2013


Thank you, Trustee Cast. 
Today I am very pleased to recommend to you the lowest tuition increase at Indiana University in more than 35 years.

The Challenge of Affordability

It is abundantly clear that—more than ever before in history—the future of our state and nation in a global, digital, information economy depends on the quality of our higher education.
It is also abundantly clear that for young people who want to succeed in this new economy, a degree from the right college or university is more important than ever.
A study by the widely respected Georgetown Center on Education and the Workforce suggests that the overwhelming majority of all new jobs in the next decade will require a postsecondary degree. Currently, only about 30 percent of Americans hold a bachelor’s degree.

The Great Recession, from which we continue to recover, accentuated the growing importance of a college degree.

Four out of five job lost during the recession required a high school degree or less. Conversely, the number of jobs requiring a bachelor’s degree or higher grew during the recession and such jobs continue to account for most of the job growth today.

However, as the recent report of the State Higher Education Executive Officers Association notes, per-student state funding for higher education has dropped to its lowest level in 25 years—and over that same period, the share of public university revenues coming from tuition and fees has climbed. With increases in tuition nationwide, there is growing concern that full-time college attendance could be out of reach for an increasing number of students. The growing concern about college costs and student debt in recent years has sparked much discussion.

A key question facing Indiana University has been—and will continue to be—how do we balance the financial needs of students and their families against the need to maintain the affordability and accessibility that is expected of the state’s flagship university?

As I have said on numerous occasions, we at Indiana University are mindful of the deep continuing public concern over the growing “sticker price” for tuition.

We have heard—and we share—the public’s concerns over college affordability.

As we developed our budget for the coming biennium, we considered every option that would allow us to recommend to our Trustees the lowest possible tuition increase over the next two years to ensure the continuing affordability of an IU education.

Tution Recommendations

For each of the next two academic years, we are recommending that tuition and fee rates for Indiana resident undergraduates increase by an average of 1.75%.

This recommendation is in full accord with the non-binding tuition target of 2% recommended by the Indiana Commission for Higher Education last month.

Moreover, this is the lowest rate of increase at IU since the late 1970s.

Indiana University has consistently demonstrated in recent years its commitment to providing an affordable education despite constrained state funding. This recommendation for a modest increase is our latest effort to continue to provide an affordable education to our students.

On-Time Completion Awards and Summer Tuition Discount

Many of our students will see no increase in tuition at all over the next two years.

Beginning this fall, students who are on-track for graduation in four years by the end of their sophomore year will receive an on-time completion award that will cover the cost of any tuition increases for their junior and senior years—what we call the “Finish in 4” program.

The on-time completion award will benefit students and their families in two ways: first, by graduating within four years, they reduce their costs, and second, students and their families gain increased financial certainty and predictability as to their costs for their junior and senior years. This initiative also strongly supports two major goals of theIndiana Commission for Higher Education—greater affordability and reducing time to graduation.

And, for the second year, we are also addressing issues of cost and timely degree attainment by offering the Summer Tuition Discount program, in which we lowered tuition for all undergraduates attending summer sessions on any IU-managed campus by 25 percent for Indiana resident students and an equivalent dollar amount for nonresident students. Although the program has not been as widely utilized on all campuses as we had hoped, it is indicative of our ongoing focus on affordability and our willingness to be creative in providing affordability options for IU students.

Of course, one of the main ways student debt can be reduced is through the provision of financial aid. I am proud to note that we have more than doubled the amount of institutional aid to students in the past five years—and this is not loan aid, these are grants and scholarships that students do not have to pay back. We recognize, however, that not all IU students qualify for need-based financial assistance or for merit-based awards. It is worth noting, then, that both of our initiatives to reduce tuition—the summer tuition discount and the “Finish in 4” program—apply to all IU students on all campuses.

Further Indicators of IU’s Affordability

Evidence of the effectiveness of IU’s institutional aid programs is borne out by net price data published annually by the U.S. Department of Education. The Department of Education ranks us the most affordable university in the Big Ten.

The White House’s College Affordability and Transparency Center’s College Scorecard also ranks IU as having the lowest net cost of attendance in the Big Ten.

For the sixth consecutive year, Indiana University was ranked by Kiplinger’s Personal Finance as being among the “100 Best Values in Public Colleges.” On the most recent list, IU ranked 39th overall and 4th among Big Ten universities.

And in each of the last several years, we have set overall enrollment records, with more than 110,000 students enrolled at IU, and with new enrollment records set on nearly every campus. As I have said before, such record enrollment numbers are not the mark of a university that is seen as unaffordable.


We very much appreciate the decision by the Indiana General Assembly to appropriate additional funds to the university over the next two years as recommended by the Indiana Commission for Higher Education. We are grateful, as well, to the taxpayers and citizens of Indiana for their support.

And, as always, we are also grateful for the ongoing generous support of our alumni and friends of the university. Their extraordinary generosity has made possible much of the additional financial aid we have been able to give to our students over the past several years.

And, as I have noted on many other occasions, members of our staff have worked diligently to find and implement operational efficiencies that have allowed us to control our costs.

All of these factors—additional support from the state, the generous philanthropic support of alumni and friends, and the diligent efforts by our staff to control costs—have helped to make it possible for us to recommend the smallest tuition increase in more than three-and-a-half decades.

Now let me turn the floor over to Interim Vice President and Chief Financial Officer MaryFrances McCourt to present the proposed 2013/15 tuition recommendations.

Source Notes

  1. Jamie Merisotis, “Tackling the Urgent National Challenge of College Affordability: Criteria for System Redesign,” Huffington Post, May 7, 2013.