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Trustees approve tuition increase for incoming students

INSIDE ILLINOIS, June 3, 2010  | Christy Levy, UIC

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The UI Board of Trustees approved a guaranteed four-year 9.5 percent tuition increase for incoming students and authorized a short-term borrowing plan the university may use to address a continuing backlog in state payments.

The state of Illinois owes the UI $381 million in unpaid appropriations for the fiscal year, which ends June 30, university vice president Walter Knorr told trustees at their meeting May 20 on the UIC campus.

The tuition increase applies only to incoming Illinois-resident freshman students for the 2010-11 school year. The tuition is guaranteed by law not to increase for this cohort of students for four years. Current students won’t see an increase in tuition in accordance with the university’s Guaranteed Tuition Plan.

The base tuition for incoming students will rise $902 per year to $10,386 at the Urbana campus; $792 per year to $9,134 at the Chicago campus; and $706 per year to $8,108 at the Springfield campus.

Trustee Timothy Koritz abstained from voting on the tuition increase. Student trustees from all three campuses voted against the increase.

Other fee increases approved by trustees include a $250 per semester surcharge for international students and a $1,250 per semester surcharge for international engineering students; a $10 fee increase for domestic undergraduate applications at all three campuses, for graduate school application fees at UIC and Urbana, and for international undergraduate students at Urbana and UIS; a $15 application fee increase for international graduate students at Urbana; and a $20 application fee increase for the College of Dentistry at UIC.

Interim President Stanley O. Ikenberry said measures the university has taken so far to alleviate the budget crisis – such as employee furloughs and hiring freezes – have not financially affected students.

“We have taken a number of steps over the course of the year to make sure that students aren’t caught in the middle,” Ikenberry said. “The incoming class will experience a tuition increase, but they will have the assurance that that will be the single increase.

“It’s important for us to understand that the very first priority will be the financial aid money that will be necessary to protect access and affordability for low- and middle-income students.”

All three campuses offer financial-aid grants that supplement federal and state grant programs. About 15 percent of tuition dollars fund these supplemental grants, Ikenberry said.

Supplemental financial aid for the 2010-11 academic year will increase by about $6.5 million to $42.3 million, Knorr said. Forty-six percent of students at the Urbana campus pay less than the full cost of tuition plus room and board and fees as a result of need- and merit-based financial aid.

At Urbana, about half of students pay $2,000 or less in tuition or fees, Knorr said. “That’s as it must be if we’re going to be able to recruit and retain students from all income levels,” Ikenberry said.

Trustees approved a preliminary budget for fiscal year 2011, which begins July 1.

The plan reduces the university budget by $45.5 million – the amount of the one-time federal stimulus funds received in March.

To address the financial crisis, trustees also approved short-term borrowing which was authorized by legislation passed May 6 by the General Assembly and sent to Gov. Pat Quinn for his signature. Last week, Quinn said he will act on a bill allowing public universities to borrow money to cover a state funding shortfall after he signs a state pension borrowing plan. Under the bill, state universities can borrow up to 75 percent of what they’re owed by the state.

The universities initially opposed the idea of borrowing funds to meet operating expenses, but ultimately supported the law for the flexibility it offers as the state’s budgetary crisis continues. The law limits universities’ borrowing to emergency short-term lines of credit or promissory notes to pay for operations in anticipation of the state’s fiscal 2010 billed but unpaid reimbursements. It specifies that the universities’ borrowing must be finalized within 90 days of the bill’s passage, and that borrowed funds be applied to paying salaries and other expenses normally covered by state appropriations.

The maximum interest rate on money borrowed is 9 percent or less, and borrowed funds must be repaid in one year or within 10 days of the state’s payment of past-due 2010 appropriations.

The board began its budget planning for the 2011 fiscal year by passing a continuing resolution to keep the university operating legally after June 30 and until the state has a new budget in place.



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