Tuition up 4.5 percent

The Yale College term bill for the 2007-08 academic year will increase to $45,000 next year, University officials said Monday.

Total costs will increase 4.5 percent from the 2006-07 year, the lowest percentage increase in five years, but one that continues to outpace inflation. Rising salaries, utility costs, health care costs and increased investment in new programs contributed to the increase in tuition, officials said. Some students criticized the University’s decision to continue raising the term bill, but others said the increase is understandable, particularly since the self-help contribution for students receiving financial aid will not increase from last year.

Tuition, currently $33,030, will rise to $34,530, while room and board will rise from $10,020 to $10,470 this academic year. Total fees increased 5 percent from 2005-06 to 2006-’07.

By comparison, Princeton’s term bill increased by 4.2 percent to $43,980 this year while Harvard’s increased 4.5 percent to $45,620. Princeton increased its charge for room and board only, while its tuition will remain constant this year to next. Yale takes into account the tuition decisions of other universities when setting its own rates, Deputy Provost for Undergraduate and Graduate Programs Lloyd Suttle said.

Provost Andrew Hamilton said the University’s current bill places it ninth in tuition costs among its peer schools — the Ivies plus the Massachusetts Institute of Technology, Stanford University and the University of Chicago.

“We have tried hard to keep tuition increases as low as possible and next year’s increase is less than this current year’s,” he said in an e-mail.

Though the University did not announce any major financial aid initiatives, the financial aid budget — set at $59.9 million this year — will rise to $62 million next year, Financial Aid Director Caesar Storlazzi said in an e-mail. The approximate 3.5 percent increase falls short of last year’s 8 percent boost.

The self-help contribution will not increase — it has stayed at $4,400 for several years — and the increased term bill will be met by an increase in financial aid packages.

The Consumer Price Index, a standard measure of inflation, rose 2.4 percent over the last year through February, according to the Bureau of Labor Statistics. Though Yale’s $18 billion endowment continues to earn class-leading returns on its investments and is the second-largest per student among major endowments, the University’s long-term financial plan also includes increases in costs, Suttle said. At the beginning of the budget process in December, Yale officials had informed employees that they expected university-wide tuition income to increase 4 to 5 percent in the 2007-’08 fiscal year.

Tuition increases often outpace inflation because university costs tend to rise more quickly than consumer costs. Tuition must go up at a faster rate to cover increasing faculty and staff salaries, said Cornell University professor Ronald Ehrenberg, who specializes in the economics of education. While the productivity — and thus the salaries — of workers in other industries increases every year, professors’ productivity remains constant. But in order to be competitive with those industries, universities must raise their salaries, too.

“We try really hard to maintain class size and small student-faculty ratios,” Ehrenberg said. “If they raise tuition at the rate of inflation, then faculty salaries will only go up at the rate of inflation, and faculty salaries will fall in relation to salaries in other fields.”

But William Strauss, a prominent critic of rising tuition costs, noted that university tuition and fees did not routinely exceed inflation until the early 1980s. High inflation rates in the 1970s were met with large tuition increases — often more than 10 percent a year — a habit he said did not disappear once overall inflation fell.

But Ehrenberg said this phenomenon is not so novel. The cost of attending the nation’s colleges has been increasing more quickly than inflation for more than 100 years, though he said until 25 years ago, the average family’s income increased at roughly the same rate. Even though tuition now increases faster than household income, he said, the growth is unlikely to slow any time soon. With tens of thousands more applicants than they can accept, elite colleges do not face a shortage of students who are willing to pay, he said.

“We are in a very, very competitive society, and one thing that has happened over the last 35 or 40 years is that our income distribution has widened greatly,” Ehrenberg said. “People really feel where you go to college is as important as whether you go to college, and there actually is a lot of sense to that. Studies show that if you go to a place that is spending more on you, you’re going to make more money when you graduate.”

This year’s rise in the financial aid budget is not as great as last year’s, and some students said the University’s commitment to financial aid is not strong enough. Phoebe Rounds ’07, a member of the Undergraduate Organizing Committee, said Yale could put a stronger emphasis on making its education affordable.

“I think it’s unfortunate that Yale doesn’t take a substantial step to be a leader in terms of offering financial aid,” she said. “I know a lot of people who are not on financial aid but for whom it is still a very difficult to pay for a Yale education. It does make it difficult for all students — not just those on financial aid — when the University raises tuition like this.”

Alex Civetta ’09 said the tuition increase is “scary,” and he wonders how the University’s endowment is being spent. But the comparatively high cost of a Yale education is justified because the resources students have access to, he said.

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