UC proposes annual tuition increases over five years to boost predictability, financial aid

The University of California is proposing annual tuition increases over five years under a sweeping plan to raise more money for financial aid and campus needs while providing a predictable roadmap of future cost hikes for students and parents.

The proposed tuition increase, which UC regents will consider next Wednesday, would be the second in nine years and the amount would vary depending on two plans presented.

One plan — to raise tuition and fees for all students annually by the cost of inflation — would amount to a projected 2.8% increase of $348 over last year, to $12,918 for fall 2020.

The second plan would raise tuition and fees once for each incoming class, called cohorts, but keep those costs flat for six years. Under that plan, the costs for the entering class of 2020-21 would increase over last year by 4.8%, or $606, to $13,176 for California undergraduates. The tuition of existing students would be frozen at their current levels.

In addition to those base costs, supplemental tuition for nonresident undergraduates would increase $840, to $30,594, this fall under the first plan and an additional $1,440, to $31,194, under the second plan.

More than half of UC in-state undergraduates with the greatest economic need would pay less than they do today under both plans to raise tuition because they would receive more financial aid. That’s because one-third of every tuition dollar goes to financial aid, which can be used not only for tuition and fees but also for housing, food, transportation and other costs.

Under the first plan, for instance, students whose parents earn less than $80,000 would receive $488 in additional financial aid, fully covering the $348 tuition increase and leaving an additional $140 for housing, books and other expenses. With no tuition increase, the student would receive no extra financial aid.

UC President Janet Napolitano is recommending that the Board of Regents approve either of the plans “so that, as campuses begin extending offers of admission in February for the fall 2020 term, prospective UC students can make informed enrollment decisions, continuing students can know what level of tuition and fees to expect and campuses can prepare to provide the educational opportunities, academic support, financial aid, and student services needed to sustain the University’s unparalleled track record of access, affordability, and academic excellence,” according to a UC memo.

The UC Student Association, however, is opposing the plans, and leaders say they were caught off guard by the proposed multiyear increases.

UCSA President Varsha Sarveshwar said she was “stunned” and disappointed by the proposal. She said locking in five years of tuition increases at once was unnecessary and would hurt the tens of thousands of students who would not qualify for more financial aid and lower costs, including those from other states and countries. She also said a multiyear plan would discourage students from lobbying Sacramento for more funding and wondered who would bear the burden if a recession triggered major cuts in state support.

In addition, some critics say it’s unfair to charge some students more than others for tuition. Under the cohort plan, California undergraduates entering in fall 2020 would pay $13,176 in tuition and fees while those entering in 2024 would pay $15,414.

“A long-term tuition plan is completely premature and unfair to students,” Sarveshwar said.

But UC chancellors have long pressed for predictable increases so they can better plan their campus budgets, accommodate demands to enroll more California students and maintain the quality of the nation’s top public research university system.

UC Berkeley Chancellor Carol Christ, for instance, told regents in 2018 that the campus had added 4,700 more students since 2013-14 but had not received enough money to cover the costs of educating them. As a result, she said, the average size of lower-division engineering and computer science classes had gone from 65 in 2011-12 to 227 in 2016-17.

She also said then that Berkeley’s $700-million backlog of much-needed maintenance was affecting its stature. The campus lost its bid to recruit one of the world’s leading chemists, she said, because it could not afford to renovate a laboratory to meet his needs.

UC budget officials have told regents that billions of dollars more are needed not just for maintenance but also for new classrooms, dorms and labs, salary increases and to cover escalating pension and health costs.

UC spending per student has dropped by 31% between 2000 and 2017 because state funding has not risen to fully cover the additional 100,830 students enrolled during that time. The proportion of state funding for UC’s core budget has plummeted from 84% in 1990 to 42% this academic year; tuition now accounts for a greater share.

UC San Diego Chancellor Pradeep Khosla said Thursday that he favored the cohort tuition plan because it laid out the most predictable increases for students and families. He also said ruling out increases and keeping tuition flat “disproportionately affects the neediest students, as living costs have been going up but the financial aid is constant.”

Board Chairman John A. Pérez has said that, short of adequate increases in state funding, he also favors a cohort-based plan that raises tuition once for an incoming class rather than annual increases while a student is enrolled.

“My values say that when a family looks at all those places that their student gets accepted to, they ought to be able to have a clear sense of what it’s going to cost them. Not just the top-line cost, but the real family cost — what the family contributes, what the student contributes,” he told The Times last year. “And so I am predisposed against voting for any tuition increase that impacts current students. That means from my worldview, the only two options that make sense are increased state investment or a very modest cohort-based increase where upon admission, you’re guaranteed what the rate is for your time as a student.”

The tuition memo expresses appreciation for Gov. Gavin Newsom’s proposed 2020-21 budget, which includes more than $217 million in new, permanent UC funding over last year. The money will help pay for such things as additional student support, research initiatives, expanded medical education, agricultural initiatives and immigrant legal services.

But UC officials say that’s not enough to cover their ambitious plan to increase California undergraduate enrollment, expand academic support to raise graduation rates and reduce achievement gaps, repair long-neglected infrastructure, strengthen student mental health services and address faculty and staff salary gaps. UC is currently projecting a budget shortfall of $250 million for the 2020-21 school year, growing to $734 million in five years, without more funding.

“Moderate and predictable increases in tuition and fee revenue would significantly narrow, although not close, the budget gap,” the memo said.

Napolitano is asking the regents to allow lower tuition hikes if the state provides more than a 5% increase in UC’s permanent base budget over the previous year.