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Memorandum

TO:                 Board of Governors

FROM:           Executive

DATE:            Draft (030201)

RE:                 Recommended Tuition Fees for 2002-03

Summary

This memo outlines the principles Vancouver Island University expects to follow in setting tuition fees now that these fees are being left unregulated by the Ministry.  It also makes specific recommendations for tuition levels in 2002-03.  In brief, the recommendations are:
  • Leave tuition for "pre-college," developmental programs (ABE, ESL, ASE) unchanged.  The Ministry requires a no-fee policy for Adult Basic Education.
  • Establish one tuition fee category for all Ministry-funded academic and career technical programs for years 1 to 4, thereby eliminating the current distinction between lower-division and upper-division fees.  Set the fee for the new category in 2002-03 at $79 per credit.
  • Revise the tuition for Applied Studies and vocational programs that charge by the month to $237 per month, with a part-time rate of $142 per month.  This ties the monthly vocational fee to the per-credit rate for academic programs.
  • Advise students that the previous two tuition rates are likely to be increased further by up to 20% per year in each of the next two years.
  • Offset the effects of tuition increases and other funding changes by allocating, on an on-going basis,  a total of $500,000 to three areas: (1) $175,000 for on-campus student employment, to replace a cut made by Government; (2) $100,000 to match public contribution to bursaries, also to offset a cut made by Government; and (3) $225,000 for special tuition bursaries to ensure that the students in most financial need get some relief from the effects of the tuition increase.
  • Set International Education fees at $3900 per semester.

The net effect of these recommended changes varies by program area.  Overall, there is an average increase in tuition of about 78% for domestic students.  This sharp increase is explained later in the memo.  However, it is important to note that there are no additional fees for technology, building funds, laboratories, and the like.  In fact, some fees like these that now exist will be eliminated.

Background

In the past six years, the Ministry has frozen tuition, even as the Ministry grant has failed to keep pace with inflation.  Inevitably, the quality of education has suffered.  Indications are that the Ministry's grant per student will remain static over the next few years, while costs continue to rise.  Recently, however, the Ministry has ended the tuition freeze and signalled that it expects institutions, in future, to get a higher proportion of their total operating funds through tuition.

Thus, for the first time in years, Malaspina has to set its tuition rates.  Tuition is a complex issue, and often an emotional one as well.  Higher tuition may mean that some student can no longer afford an education.  But without an increase, the quality of education deteriorates.  This access-versus-quality dilemma is not simple.  Good access is more than a matter of lower fees.  For a student, being able to take a good quality program close to home, even with higher tuition, is cheaper overall than having to leave the region to get this education.  The quality side of the debate is also complicated, because Malaspina is a different institution than it was five and ten years ago.  Malaspina used to compare itself to other community colleges in discussions about tuition fees.  Now it compares itself to a smaller group of university colleges and, increasingly, to Canadian universities that are oriented to their regions.  In terms of the range and quality of programs and services, more is expected of Malaspina now than it was five or ten years ago, and Malaspina expects more of itself.

Tuition Principles for Malaspina

  1. Malaspina is committed to providing the mid-Island region with a wide range of quality programs.  This may sometimes mean that programs will cost more to deliver at Malaspina than they would at larger institutions with more economies of scale.  However, because tuition is only a part of the total cost of education, being able to attend a program at Malaspina can mean significant financial savings for a student from the region, even with higher tuition.  Malaspina will not choose to teach some programs rather than others simply because they are less expensive to offer and therefore help to keep tuition lower.  Nor will it compromise the quality of programs, just to keep tuition lower.
  2. Malaspina recognizes that increased tuition can make education unaffordable for students with limited financial means.  It will therefore continue to encourage the provincial and federal governments to:
    • Provide grants that are sufficient to keep tuition levels reasonable; and
    • Arrange financial assistance programs to ease the burden on students with limited means.
    Malaspina also accepts the responsibility to:
    • Offer a quality education as efficiently as possible, thereby reducing the need for higher tuition; and
    • Ensure that a portion of the budget goes towards bursaries and on-campus employment opportunities that can help to reduce the financial burden on students.
  3. Malaspina recognizes the value of simplicity and predictability in tuition fees.  To this end, in setting tuition for programs that are supported by the operating grant from the Ministry, Malaspina will:
    • Include most University costs paid by students within the general tuition level and avoid add-on charges and user fees for specific services, unless there is good reason to believe that a separate charge for a specific service helps to encourage more responsible use of that service.
    • Set tuition levels equally across all academic and career credit programs for years 1-4, thereby eliminating the distinction between fees for lower-division and upper-division courses.
    • Set the monthly charge for vocational programs, where one FTE of instruction is based on ten months of instruction, to be equal to one-tenth of the value of 30 credits of instruction (i.e., one FTE) in the academic and career program area.
    • As much as possible, project tuition changes two years into the future.
  4. In assessing the quality of instruction and services it supplies and the tuition levels that are appropriate to support this quality, Malaspina will benchmark itself against a set of peer institutions-primarily other university colleges, technology institutes, and primarily undergraduate universities that are oriented to a regional market within a provincial system.  At the same time, Malaspina remains committed to offering quality programs and services at tuition levels that are below those of UVic, UBC , and SFU.
  5. Malaspina recognizes the educational value of a diverse population of international students on campus.  Malaspina also recognizes that education for international students is not subsidized by the Government and that these students must pay the full cost of their education.  Therefore, the fees for international students will consider market conditions and be designed to include (a) the equivalent of the Ministry grant for domestic students, (b) the tuition a domestic student pays, (3) any special costs involved in attracting and retaining international students, and (4) a levy for capital costs (e.g., buildings and equipment).

Tuition Recommendations for 2002-2003

1.  Developmental programs

RECOMMENDATION:  Maintain tuition for "pre-college," developmental programs (ABE, ESL and ASE) at the current rates.

Government policy continues to require that there be no tuition for ABE (Adult Basic Education).  Tuition for ESL (English as a Second Language for domestic students) and ASE (Adult Special Education-known at Malaspina as Access programs) needs to be reviewed prior to next year to see what increases are appropriate.  Currently, tuition from both these areas combined is only about 1% of total tuition.

In Appendix A, a new category for ASE/Access programs has been established rather than having its tuition listed as an inconsistent tag-on to the ABE rate).

2.  A common fee for academic and career courses, years 1 to 4

RECOMMENDATION:  Eliminate current tuition fee categories I, III, V, and VIII, as well as the add-on list of laboratory and materials fees for some courses, and establish a new category I with a single per-credit fee for all academic and career courses. 

Two things happen if this recommendation is accepted.  One is the elimination of a number of add-on fees listed in the tuition policy for laboratories and field trips.  At the moment, these add-on fees are applied inconsistently across programs.  They were created at various points in the past to allow a particular program to raise money that might otherwise have been unavailable through the budget process.  With the significant increase in tuition for 2002-03, it seems only fair to eliminate these add-on fees and also to place all programs on the same footing of having to request money through the regular budgetary process.  Programs that currently have these fees will not be disadvantaged.  They will have the equivalent of their current fee income added to the base operating revenue of the department.  Malaspina will also re-examine other non-tuition fees that may be levied by programs.  The general principle is that students will pay extra for equipment and supplies that they can use outside the program or that end up in their possession at the end of the program.  Otherwise, expenses for educational experiences and for equipment that remains in Malaspina's possession will be provided through general tuition.

The second and more significant effect of this recommendation is to remove the current differences among tuition levels for upper and lower division programs.  Currently the tuition is $40 per credit for courses at the Year 1 and 2 level (lower division) and $60 per credit for courses at Years 3 and higher (upper division).  The general rationale for a single tuition level across all program level is that faculty salary levels are identical and workload practices are becoming more uniform.  Also, a common fee structure is easier to explain.

3.  The standard tuition rate for 2002-3

RECOMMENDATION:  Set the tuition level per credit for 2002-2003 at $79.  Advise students that this tuition level is likely to rise as much as 20% in each of the next two years.

Given recommendation 2 above, and recommendation 4 to follow, setting the standard tuition fee per credit in academic programs is the single most important decision affecting tuition.  It effectively determines the overall level of tuition revenue for the University and the fees that over 80% of VIU Students will pay.

The proposed standard tuition rate of $79 for 2002-03 amounts to an overall increase in tuition of about 78%.  The Executive is aware that this is considerably higher than the 30% increase that nearby colleges and universities have reportedly been considering.  However, there is good explanation for the larger increase for Malaspina.

During the funding freeze, Malaspina moved from being more of a college to being more of a university.  It has expanded its degree programs considerably, ended its partnership arrangement with the University of Victoria, and began offering degrees under its own name.  Thus Malaspina needs not only the 30% tuition increase that both colleges and universities seem to agree on, but also additional money to address the quality issues that come with being more of a university.  Traditionally, university fees have been about twice those of colleges, and Malaspina fees have been comparable to those of colleges.  The proposed tuition level of $79 per credit will place Malaspina somewhere between the community colleges and the traditional universities.

In effect, Malaspina is beginning to set tuition in terms of a new peer group.  Almost all post-secondary institutions use a peer group as a benchmark in setting tuition.  By keeping the benchmark in mind, they can have some confidence that they have the resources to provide education of an appropriate quality and that they are not asking students to pay more than students in similar institutions elsewhere are being asked to pay.  The big issue, of course, is identifying the appropriate "peer group" for Malaspina.  This will be a matter of continuing debate as the character of Malaspina changes in years to come.  For now, however, it seems there are several kinds of Canadian institutions that can fairly be said to constitute Malaspina's peer group.  These are:

  • Other university colleges in British Columbia and Canada.
  • Technology institutes like BCIT, SAIT, NAIT and SIAST.
  • Primarily undergraduate universities that are oriented to a regional market within a provincial system-UNBC is an example in BC while the University of Lethbridge is an example in Alberta.

If we look at the current fee level of Malaspina's peers, we find the following. 

Current Tuition per Credit of Malaspina's Peers

BCIT

74.50

UNBC

76.50

Lethbridge

112.00

Brandon

91.00

Nippissing

124.00

Laurentian

131.00

University College of Cape Breton

135.00

University College of the Cariboo

42.50

Vancouver Island University (blended)

42.75

These are current fees.  Judged from this perspective, the $79 per credit seems appropriate. 

  • It compares favourably to Malaspina's peer group in BC.  Because institutions like BCIT and UNBC are almost certain to increase their fees by at least 30% in the coming year, Malaspina's value advantage to students will still be considerable.
  • Compared to peers elsewhere in Canada, Malaspina's proposed tuition (and BC tuition generally) is low.
  • Malaspina's most obvious direct peer group is other university colleges in British Columbia.  They, too, have become more university-like during the tuition freeze and all of them are planning tuition increases of the magnitude Malaspina is proposing.  For example, Kwantlen University College has announced that it is also considering tuition of $80 per credit in order to bring it closer to BCIT rates.

With a significant increase in 2002-03, it is possible that Malaspina's increases in subsequent years will be more modest than increases for nearby colleges and universities.  For example, Malaspina anticipates increases of up to 20% in each of 2003-04 and 2004-05.  This contrasts with the continued increases of 30% that are reportedly being considered by universities.

It is unfortunate that the six-year tuition freeze and Malaspina's changing status coincided and that we are now faced with a large increase.  But considered over the six years of the freeze, the increase is not disproportionate.  In fact, $79 is about what the tuition that would have been if Malaspina had increased its average 1996-97 tuition by 10% in each of the last six years.

4.  A monthly rate for applied programs that is tied to the basic tuition rate for academic programs

RECOMMENDATION:  Set the monthly rate for a full-time student in applied studies at $237 per month.  Set the rate for a part-time student (one taking less than 60% of a regular program during the month) at 60% of the full-time rate, i.e., $142. Advise students that these rates are likely to climb about 20% per year for each of the next two years.

The rates proposed here are based on the standard tuition rate set for academic and career programs, adjusted for the way FTEs are calculated and faculty workload operates.  The rationale is as follows.  The standard Applied Studies/vocational program (with BCGEU instructors) is 10 months in length.  A full-time student in such a program counts for one FTE student.  In academic programs, 30 credits equal one FTE student (these credits are taken over 8 months if the student is studying full-time).  Therefore the monthly rate for applied programs is 30 credits at the standard tuition rate for academic programs divided by 10.  This means an FTE student in Applied Studies pays the same as a general-program FTE student in academic studies.

The approach to part-time rate for Applied Studies students has also changed, although this doesn't have much practical importance at the moment (the number of part-time students is very small).  The current part-time rate of $107 is more than 80% of the full-time rate, but there is no definition of what constitutes part-time vocational study.  The recommended approach involves following current student loan criteria and defining part-time study as less than 60% of a regular load.  It then sets the part-time rate at 60% of the regular rate.

5.  Co-op Education fees

RECOMMENDATION:  Set the tuition at $350 per semester for the work placement terms in co-op education programs.

The credits attached to work terms in co-op education programs are set artificially high in order to allow students to continue to claim full-time student status and thereby avoid having to start repaying student loans.  Therefore, most institutions set tuition for work placement terms in a way that is unrelated to credits.

The $350 that is proposed here for work placement semesters is an increase of 80% over current rates.  This is in line with the overall increase in tuition at Malaspina.  This new rate will also put us in line with what other institutions charge.  Current charges at other institutions are often quite a bit higher than Malaspina's $194-e.g., UVic ($324), UNBC ($301), SFU ($310), UBC ($302), UCC ($250), UCFV ($332), KUC ($405) BCIT ($301) and OUC ($175).  Although our proposed 2002-03 fee will put us ahead of the current fees of most of our peers, these other institutions will also be increasing their co-op fees significantly this year. 

6.  Off-setting some effects of the tuition increase

RECOMMENDATION:  Allocate $500,000 in the budget for tuition relief in the following ways: $175,000 for on-campus student employment; $100,000 to match public contributions to bursaries; and $225,000 in special tuition bursaries for those students in most financial need.

The money for on-campus student employment and contribution-matching replaces "soft" funding that was recently cut by Government.  The $225,000 for tuition bursaries is new and will be in addition to Malaspina existing awards.

It is important that this $225,000 for tuition bursaries go to deserving students in years 1 to 4 who need it most, with an absolute minimum of administrative costs.  At the moment, it seems likely the money will be broken into 650 tuition awards of $350 each.  These will be awarded as tuition grants for the Spring semester to students who:

  • Are currently receiving support from the British Columbia Student Assistance Program (BCSAP);
  • Have the greatest "unmet need," as identified by BCSAP;
  • Have at least a "C" GPA in the Fall semester.

Obviously, these tuition bursaries will not eliminate all the hardship that students will experience because of the increased tuition.  But they will provide relief for those in most financial need.  The 650 bursaries will reach about 25% of the students receiving BCSAP loans and provide relief from 30% or more of the tuition increase.

7.  International fees

RECOMMENDATION:  Set International Education fees at $3,900 per semester.  Advise students that the fee per semester for programs other than ESL, will likely increase $300 in each of the next two years.

Until now, Malaspina has set fees for international students on a standard per-semester basis for nearly all programs.  In the future, it is expected that students in academic and career programs will pay more than those in ESL programs.  Setting appropriate International fees is always difficult, and it is particularly so at the moment because of changing fee structures in British Columbia and aggressive pricing from Prairie institutions.  However, the following table shows that current Malaspina rates are not out of line with those of other institutions. 

Current Fees for International Students per Semester

School

ESL

Academic

UBC (12 weeks for ESL)

3,588

7,740

SFU

3,400

3,600

UVic

2,950

3,405

Manitoba

2,450

2,500-3,050

Regina

2,220

2,190

Saskatchewan

2,100

4,005

Lethbridge

2,150

3,996

Calgary

3,180

4,770

Malaspina current

3,600

3,600

Malaspina proposed

3,900

3,900

Appendix A

Current Calendar Copy
(actual fees in effect are only about 95% of those listed)

Proposed Calendar Copy

Category I: Career/Technology programs
Tuition fees are $42 per semester credit hour to a maximum of $756 per semester, unless otherwise stated. Courses taken in addition to the full-time program requirements will be assessed at $42 per credit hour.

Category I: Academic and Career program courses
Tuition fees are $79 per credit hour.  This is likely to increase by up to 20% in each of the next two years.

Category II: Community Education courses
Fees for C.E. courses vary and are published in the Fall and Spring C.E. brochures. GST is charged for most C.E. courses, as listed in the brochure.

Category II: Applied programs
Tuition fees are calculated at $237 per month for full-time Applied programs; part-time students pay $142 per month. Fees for Applied programs are due in full prior to commencement of the program.  These fees are likely to increase by up to 20% in each of the next two years.

Category III: Distance Education courses
Tuition is $42 per credit hour, materials fee $135, to a total of $261 per 3-credit course.

Category III: English-as-a-Second-Language courses
Tuition is $94 per course to a maximum of $376 per semester.  This fee is under review for the future.

Category IV: English-as-a-Second-Language courses
Tuition is $94 per course to a maximum of $376 per semester.

Category IV: Adult Basic Education courses
According to policy set by the Ministry f Advanced Education, no tuition fees are charged for Literacy and Adult Basic Education courses; however, students are still required to pay Students' Association and Student Activity Fees

Category V: University courses-first and second year
Tuition fees are $42 per credit hour for 100 and 200-level courses ($126 per 3-credit course), unless otherwise stated.

Category V: Access Programs
Tuition for courses in Access Programs is assessed at $.58 per hour.  This rate is under review for the future.

Category VI: Career & Academic Preparation programs
No tuition fees are charged for Literacy and Adult Basic Education courses; however, students are still required to pay Students' Association and Student Activity Fees.  Tuition for courses in Access Programs are assessed at $.58 per hour.

Category VI: Co-operative Education
Tuition is $350 per semester for the work placement in co-op programs.

Category VII: Applied programs
Tuition fees are calculated at $131 per month for full-time Applied programs; part-time students pay $107 per month. Fees for Applied programs are due in full prior to commencement of the program.

Category VII: Community Education and Continuing Studies courses
Fees for C.E. courses vary and are published in the Fall and Spring C.E. brochures.  GST is charged for most C.E. courses, as listed in the brochure.

Category VIII: University courses-third year and up
Fees are assessed at $63 per credit hour ($189 per 3-credit course and $378 per 6-credit course).

Category VIII: International Students
Tuition fees for international students in regular programs are $3,900 (Cdn) per semester.  For students in academic and career programs, these fees are likely to increase $300 per semester in each of the next two years.  Co-operative Education fees for international students for the work placement are $900 (Cdn) per semester.  For more details see the International Students section of this Calendar.