published Sunday, February 20th, 2011

Sewanee to cut tuition

Concerned about being able to compete with the country's elite private schools for top-flight but cash-poor students, officials with the University of the South: Sewanee chose to cut tuition costs by 10 percent next fall.

The decision -- a rare one amid years of tuition increases nationwide -- will save Sewanee students $3,570 this year and has created a stir among private colleges across the country.

"[This] is a rare but bold move that very well may have reverberating effects across higher education," said Tony Pals, a spokesman for the National Association of Independent Colleges and Universities.

Small and selective private universities nationwide are anxious about how the economic recession will affect enrollment numbers long-term. Some private colleges have seen their freshman classes shrink while cheaper state universities and community colleges are booming.

Overall enrollment growth in the private-college sector was below 1 percent last year, Pals said, but schools such as the University of Tennessee at Chattanooga and the University of Tennessee at Knoxville grew more than 2 percent.

Almost all schools -- public and private -- have increased tuition costs significantly, and further increases are expected this year. Over the last 10 years, tuition at private universities nationwide increased by more than 50 percent on average, Pals said.

Sewanee's tuition went up 30 percent over five years, to $35,862, before the 10 percent trim decided upon last week.

Only 12 private institutions have lowered tuition in the last decade, Pals said, and none had the national profile of University of the South.

"Many schools can't afford to replicate [Sewanee]," he said.

SHRINKING ROLLS

Sewanee's capacity is 1,500 undergraduate students but it currently enrolls 1,401 undergraduates, down 2.4 percent from last year. The school's freshman enrollment has remained relatively flat over the last four years, hovering around 400 students.

But the school's Board of Regents wants Sewanee to grow its undergraduate population by 25 students a year, said the Rev. Donald Fishburne, a Chattanooga resident and Sewanee alumnus who now sits on the board. The tuition cut is one method for attracting more students, he said.

"We do believe this could encourage some students to look at Sewanee more seriously because it's more affordable," he said.

Vice Chancellor and President John McCardell, who has been in the job for less than a year and spearheaded the tuition reduction, said he believes colleges are pricing themselves beyond the reach of more and more families.

He also thinks the model of high tuition/high discount, which has encouraged private schools to get into "bidding wars" over how much merit aid they can provide to attract students, is becoming irrelevant.

McCardell, a well-known advocate for lowering the national drinking age from 21 to 18, is the former president of the highly selective Middlebury College in Vermont.

"I have been truly amazed by the reaction to this announcement, that confirms in my mind how much the landscape has changed," he said.

"If an institution had done this 10 years ago, the word must have got out that this place is in trouble. With this, we will have redefined our own financial model, which is to make ourselves a true value."

And some parents of Sewanee students are relieved, to say the least.

Bill St. John, a native of Connecticut whose daughter is a freshman at Sewanee, said he would "beg, borrow and steal" to keep Amy at the liberal arts college.

"Sewanee is just a great school. I never thought my daughter would ever go there," he said. "Everyone is under tremendous [financial] strain today. Everything has changed. Anything that can help is such a bright spot."

COMPARE COSTS

* Public four-year colleges charge, on average, $7,605 per year in tuition and fees for in-state students.

* Private nonprofit four-year colleges charge, on average, $27,293 per year in tuition and fees.

* Public two-year colleges charge, on average, $2,713 per year in tuition and fees.

Source: College Board

about Joan Garrett McClane...

Joan Garrett McClane has been a staff writer for the Times Free Press since August 2007. Before becoming a general assignment writer for the paper, she wrote about business, higher education and the court systems. She grew up the oldest of five sisters near Birmingham, Ala., and graduated with a master's and bachelor's degrees in journalism from the University of Alabama. Before landing her first full-time job as a reporter at the Times Free Press, ...

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Dog said...

Skeptical, as an important question has not been answered. Vice Chancellor McCardell claims this is an effort to make tuition more affordable for families in need, but a 10% tuition break off $46,000 does far less good than a 50% discount off $46,000 (the latter comes from need and merit aid). This is not to suggest what Sewanee ought to do, but substance is important.

A ~50% discount is what Sewanee has been offering, on average, for close to half of its students. What percentage of ~$41,000 will now be discounted for students most in need? VC McCardell dislikes the "high tuition, high discount" practices so prevalent in private college education today, but $41,000 still is "high tuition". Without a significant discount, Sewanee tuition will remain out of reach for many. 10% off $46,000 will certainly make the school more attractive for wealthy applicants, no question.

However, if a major reason for this change is to make Sewanee more affordable for those in need, then the university cannot ignore the imperative still for major discounting, despite the tuition cut. Since Sewanee now is going to give a 10% discount to students who currently receive NO financial aid (a majority of the student body), it could be suggested that this entire initiative is more about flat enrollment for the last several years than altruism. A $2 million shortfall in budgeted financial aid for this current fiscal year probably also added to the sense of urgency. However, the decision to cut revenue in the next fiscal year by 10% combined with this budgetary expense reality is a curious strategy, unless there is a contingency to reduce financial aid significantly as an offset if higher enrollment / generous giving is not realized (or if Sewanee is willing to go into the red -- and if this is the case, McCardell has immense courage).

The marketing value of the move has already been seen in the last few days. What major online source of news has not covered this? If Sewanee would simply give some idea of what it plans to do to ensure that its students most in need will not be hurt by the plan, then it will hold a lot more water as a strategy "to make Sewanee more affordable". Also, the university should stress to prospective students of need that Sewanee will remain a viable option for them. For them, there is little difference between $46,000 and $41,000 if the lower number is prohibitive.

To the Vice Chancellor's credit, he has mentioned that voluntary support (i.e., gifts) will be a significant part of the strategy. It will have to be, since Sewanee's physical plant cannot accommodate the large increase in enrollment that would lead to significantly increased revenues from a high-volume, somewhat lower-price path. In reality, we are looking at a modest realized increase in enrollment next year at best.

February 20, 2011 at 9:40 a.m.
jpo3136 said...

I sat down and had a beer with a Sewanee graduate who was in over $50,000 in debt.

He hadn't done as well in school as he had hoped; his career aspirations for law school dashed, he was facing bills for 50K in loans. His main hope for paying those bills was his job waiting tables.

Avoid those catastrophic loans. When people loan a student money for school, they are speculating on their ability to take future, anticipated profits. We rarely think about or discuss what happens when those profits never come. More and more, we see that they don't arrive. It doesn't take a college degree to see that no one can predict the future.

The payment reductions described above: I can't see how it can be argued that these will have a strong impact. If I remember right, the University of the South has a strong set of donors who finance a lot the students. It may very well be a drop in their bills, not that of the students. Who knows.

The harsh reality is that education is essential part of being a thinking and leading person in our society; but, that preparation does not translate into increased pay. Any assessments of college which are predicated on the assumption that there will be some magic paycheck around the corner are not in line with the observable truth.

Good luck to the students at Sewanee. I'm sure many of them will do well. Also, we're glad to see that they are getting support from their community; yet, in the face of the harsh realities of today's economy, Ivy Leaguers and Name Schoolers have been doing more to erode our situation than lead our way through it. The slim adjustments outlined above seem to imply that they still don't get it.

At least their financiers don't. For many of those paying for the next generation to go through a Name School, it's just one more kid who is going to ride the airplane or climb the pyramid scheme.

February 20, 2011 at 1:55 p.m.
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