News analysis: Fretting $50k, fixed tuition

When GW debuted its fixed-tuition plan in February 2004, the idea garnered praise from a number of outside observers.

Newsweek, which listed the University as one of its “25 hot schools” in 2005, said that one “doesn’t have to be a policy wonk” to appreciate a flat tuition plan for four years of college. Boston University’s student newspaper, The Daily Free Press, called it “an excellent idea and a big step in the right direction.”

Three years later, GW made national headlines for changes to its tuition – but in a very different light.

With the recent announcement that the annual tuition and required fees for the incoming class of 2011 would be over $50,000, GW was in the spotlight once again. Coupled with CNNMoney.com listing GW as the most expensive college in the country, students, faculty and the press are beginning to question whether fixed-tuition is the right plan for GW.

At the Board of Trustees meeting earlier this month, the school’s highest-governing body approved a 3.8 percent tuition increase to $39,210 for the incoming freshmen. Coupled with mandatory fees, such as food and housing, GW became the first major school in the country to charge more than $50,000.

University President Stephen Joel Trachtenberg said attention directed at the increase, which he said is the lowest percentage increase in two decades, is hyped up.

“People love a news bit and a little headline,” Trachtenberg said in a telephone interview Wednesday afternoon. “The fact of the matter is we’re not alone, and a lot of other institutions are going to be right on our heels. And most of the press I’ve seen has been mostly sympathetic.”

He added, “We can go next year without doing any raises at all, assuming you don’t want us to increase scholarships or faculty salaries. All things are a matter of trade-offs.”

Behind fixed tuition

The class of 2008 was the first group of students under the fixed-tuition plan. To compensate for the expected tuition hikes that would have taken place over a student’s four years, trustees upped tuition by about 16 percent, from $29,000 to $34,000. This large increase in 2004 is what drove GW’s cost of attendance to the top.

Under the first three years of the fixed-tuition plan, students paid approximately $8,000 more than students at the next-highest market-basket school, New York University. While NYU’s tuition rose 5.5 percent and Georgetown’s 6 percent for next year’s freshman class, GW’s only went up 3.8 percent. These two peer institutions do not have a fixed-tuition plan.

Should this trend of having comparatively lower tuition increases continues, future GW students would save money over the course of their four years, proponents say.

A forerunner in the fixed-tuition plan, Pace University in New York City, ended its four-year experiment with the plan last month, announcing it will return to the traditional system of annual increases. Pace spokesman Christopher Cory said one of the biggest problems with fixed-tuition was poor communication on the part of the administration to explain the plan, which led to a decrease in admission rates.

“In reality, when you divide that constant tuition over four years, it’s the same as if you went to a college that had year-to-year increases. But that didn’t get across well enough, and a lot of people chose places that had more conventional pricing,” Cory said.

Trachtenberg disagreed, saying the fixed-tuition plan has not detracted students from being interested in the University.

“Did it happen? The answer is: ‘substantially no effect,'” he said. “Once we hit about 20,000 (applications) we’ve been in that neighborhood ever since; it’s been pretty level.”

Financing an education

A common concern of tuition hikes at any school is that higher tuition will result in more financial aid requests. GW Financial Aid Director Dan Small said the fixed-tuition plan has not appeared to have had any effect on the number of students who need assistance. The percentage of students receiving financial aid is hovering around 60 percent, he said.

Small explained that since the University increases at the rate of inflation, families’ incomes should increase at about the same rate.

Relief could come to students from the federal government. A bill recently passed by the U.S. House of Representatives would lower the interest rates on student loans, allowing students to look at schools that may currently be out of their price range.

Student Association President Lamar Thorpe attended a U.S. Senate hearing on college affordability last week with student leaders from other D.C.-area universities. He strongly supports making quality higher education available to everyone.

“Tuition is high, and the government can’t do something like place tuition caps on private schools,” Thorpe said. “College is something that should be accessible to all families, not just a privileged few.”

Downsides of the plan

There are also several non-monetary issues connected to the fixed-tuition plan. Robert Morse, director of data research at U.S. News and World Report, said that even if the system saves money, students and their families may be unaware of it when they look at colleges.

“I’m not sure that the general public understands fixed-tuition plans and will do all the calculations,” he said. “I understand it, but it’s what I do for a living.”

Some students, though, fully knew about the unique tuition structure at GW before they enrolled. Freshman Stuart Grimes said he heard of the plan at an information session while in high school.

He added that the recent increase in the fixed-tuition for the incoming class would have affected his plans to attend the University “only a little bit.” He said his parents would help foot the bill regardless of the figure surpassing $50,000.

Some detractors of recent tuition increases said they will hurt the diversity of the student body. English Professor Margaret Soltan said she fears the hikes will discourage some students from applying and further GW’s reputation as an elitist institution.

“I know of two students with very large scholarships who left this year,” Soltan said. “Both were grateful for GW’s generosity, but eventually found the cost of the school unconscionable in strictly moral terms, given the existence of less expensive and equally high-quality options.”

Trachtenberg said students chose to come here and knew what they would be paying for.

“People have said to me they’re more interested in getting a first-class, high-quality experience than in saving a couple thousand dollars,” he said, addingthat the University puts $120 million into financial aid and tries to make education at GW affordable.

Morse, of U.S. News and World Report, said that there is a chance the tuition hike could perversely improve admissions and the school’s reputation.

“The tuition hike could certainly make for some negative publicity,” he said. “But there are a lot of studies out there that show people have a tendency to equate quality and price.”

-David Ceasar contributed to this report.

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