Report: When Colleges Can't Increase Tuition, Many Turn to Student Fees

By Allie Bidwell, Communications Staff

Over the last several years, much attention has been focused on the rapid increase in tuition levels at colleges and universities across the country. But student fees – which sometimes are not covered by grant-based financial aid – have increased just as, if not more swiftly than tuition, according to a new study.

During the same time period that tuition levels began to skyrocket – during the height of the Great Recession – student fees actually grew faster than tuition, according to research conducted by Robert Kelchen, an assistant professor of education leadership, management and policy at Seton Hall University. Kelchen found that while both tuition and student fees increased faster than the rate of inflation, the growth in student fees was slightly higher, increasing by 7 percent above inflation in 2009-10, compared with 5 percent above inflation for tuition.

And while there has been extensive research on the contributing factors to increasing tuition levels, less is known about how and why student fees – which can be used to fund non-academic projects such as student unions – have increased so dramatically. In his paper, Kelchen explores the state-level and institutional-level factors that have contributed to rising student fees.

In some circumstances, institutions might raise student fees to fund athletic departments, recreation centers, or other facilities that make the school more attractive to wealthier students, and make it appear more prestigious and competitive during a time when many schools are competing for the same students.

“For decades, student fees have been used to fund activities that are not directly related to core instructional operations, but are considered important to the overall college experience,” Kelchen wrote. “Although student activities fees have often been controversial on the grounds of which student groups are funded and whether students should be required to fund speech they disagree with, fees for these items have gained greater scrutiny in recent years as many institutions have constructed new facilities in order to compete with peer institutions or to become more prestigious.”

Despite the increased criticism of the increase in amenities and athletic departments, Kelchen did not find that those characteristics had a strong impact on student fee levels.

“This surprising result suggests that although the growth of amenities at some colleges has been heavily scrutinized, the trend toward increased amenities funded through student fees may be limited to a small percentage of public colleges,” the paper said.

On the other hand, state economic conditions, and aspects of higher education funding did appear to play a role in student fee levels. At some institutions, for example, higher student fees serve as a revenue replacement when tuition caps are in place, or when state appropriations have significantly decreased.

Colleges located in states with higher unemployment rates tended to have lower student fees – for each percentage point increase in unemployment rates, there was a $21 decrease in student fees, which could reflect “a desire to keep higher education more affordable in tougher economic times,” Kelchen found.

Kelchen also found a strong relationship between tuition caps and student fee levels: an explicit cap on tuition increases is associated with higher student fees, “suggesting that colleges will substitute between tuition and fee revenue as needed to balance their budgets.” 

“More attention should be paid to how student fees are set at both the institutional and state levels, particularly as some states have begun to restrict their grant aid programs from paying for fees,” Kelchen wrote.


Publication Date: 6/16/2016

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