While students and faculty at the College were enjoying spring recess, President Schapiro announced a 5.3 percent increase in tuition, bringing the yearly cost of a Williams education to $47,530. This hike marks an increase of more than $2000 over this year’s $45,140 price tag, but reflects a nation-wide trend, as most four-year colleges have seen a steady increase in the cost of tuition over the course of the past few years. Last year saw an even higher increase in tuition, at 5.8 percent.
These increases have been largely offset by more generous financial aid offerings. Thus, the tuition increase will not significantly affect the entire student body, but only those not on financial aid.
In an all-campus e-mail, Schapiro stated that the 5.3 percent increase was insubstantial in comparison with other colleges, and also stressed its coincidence with the replacement of loans with grants.
However, in the past year, several colleges have announced decreases in their sticker prices, even while increasing aid spending. Both Harvard and Yale have significantly increased their financial aid packages for the following year, but their price tags will only increase by 3.5 percent and 2.2 percent, respectively.
The smaller increases at Harvard and Yale are the exception to the rule among colleges nation-wide, with a trend of more significant increase prevailing across the board. For example, Johns Hopkins will increase its tuition by 5 percent next year to $37,700, a move driven by increased operating costs and new student-focused services. With other charges like room and board factored in, the total cost will be $49,278.
According to Schapiro, the College pays close attention to peer institutions when considering its costs. The College is a member of the Consortium On Financing Higher Education (COFHE), an organization comprised of 31 private colleges and universities, including Amherst, Yale, Johns Hopkins, Dartmouth and Harvard. “We are mindful of how our sticker price, which is the amount paid by roughly half of our students, compares with the other 30 members of COFHE,” Schapiro said.
Before the decision to freeze tuition costs in 2000, in comparison with the other COFHE schools, the College was in the middle sector of the group, but this year it ranks in at number 28, 31st being the college with the lowest sticker price. However, with next year’s spike in tuition, Schapiro expects to move up several rankings, but still to remain well within the bottom quarter.
As tuition and other costs increase, the College’s financial aid offerings to students continue to rise as well. The replacement of loans with grants this year was a well-publicized change, as was the recently announced cap on home equity in determining financial aid decisions, which will lower parent contributions and increase grants for more than 300 families.
These changes also mean that some students previously paying the full sticker price may be eligible for financial aid. “The recent enhancements to our financial aid policy will affect students across a spectrum of need levels,” said Provost Bill Lenhart. Lenhart anticipates that next year, nearly half of students at the College will be receiving some form of financial aid, and that the average level of support will be roughly 75 percent.
The growth of the financial aid budget has been far more rapid than the increase in the sticker price over recent years. “As recently as the 2003-04 academic year, our total financial aid spending was under $20 million,” Schapiro said. “Next year we expect it to be around $38 million. In other words, it has just about doubled in five years.”
Currently, endowments cover 40 percent of total expenditures, including financial aid, with student charges and other College incomes making up the remainder. However, when financial aid is discounted when measuring total expenditures, the endowment covers roughly half of total costs. Lenhart sees this as a more precise depiction of financial estimates at the College. “I believe it more accurately reflects the money actually flowing in and out the door,” he said.
As a general rule of thumb, tuition rates rise at about twice the inflation rate. College tuition is contingent on fluctuations in the Higher Education Price Index (HEPI), an approximate measure of the costs of running an educational institution. “HEPI-based inflation frequently runs on the order of 1 to 1.5 percentage points higher than CPI based inflation, as it has, for example, for almost all of the past several years,” Lenhart said.
The College Board predicts that this trend will not subside in the foreseeable future. According to its estimates, tuition can be expected to increase at an average of 7 or 8 percent for the next ten years.