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TO:              Board of Governors

FROM:         Executive

DATE:          January 15, 2003

RE:              Recommended 2003-04 Tuition Fees for Base-Funded Programs and International Students

A.  Summary

Last year, after many years of frozen tuition, Malaspina made major changes in tuition policy and substantially increased tuition in most programs.  This year, we intend to adhere to the principles outlined last year and again increase tuition significantly.  This memo reviews the principles adopted last year and the extent to which they were implemented.  It also makes specific recommendations for tuition levels in 2003-04.  Except for international fees, the changes would come into effect April 1.  In brief, the recommendations are:

  • Set the basic tuition for all courses for 2003-04 at $102 per credit-a 29% increase over the current charge of $79 per credit.
  • Set the monthly tuition charged by trades and vocational programs to $306, with a part-time rate of $184.  These are also 29% increases from the current rates of $237 and $142.
  • Remove the separate graduation fee now charged to students.

·        Charge standard tuition (3 credits) for ABE courses at the 040 level and above taken by students who are already high school graduates or who have similar standing.  Otherwise, leave tuition for general "pre-college" and developmental programs (ABE, ESL, ASE) unchanged. 

  • Increase student assistance to offset the effects of tuition increases by adding $125,000 on a on-going basis to the $500,000 that was set aside for this purpose last year-with $75,000 for on-campus student employment and $50,000 for scholarships and bursaries.
  • Increase the co-op education fee to $452 for a semester co-op placement.  This is a 29% increase over the current fee of $350.
  • Set International Education fees for degree, diploma, and certificate students at $4,200 per semester effective September 1, 2003-up from the current $3,900 per semester.  ESL fees to remain at $3,900 per semester.

A final recommendation looks beyond next year to the following years.  More institutions are moving in the direction of differential tuition by program.  Although Malaspina may decide it does not want to go in this direction, it does need to consider the possibility seriously.  Thus, the Executive will:

  • Establish a working group to recommend by September 2003 whether Malaspina should move in the direction of assessing tuition differentially on a program basis and how this might be done.

B.  Malaspina's Tuition Principles in Review

Last year Malaspina adopted five principles.  Each of these is listed below, followed by a brief discussion of the degree to which it was achieved.  The following paragraph was the preamble to the five principles.

Tuition is a complex issue, and often an emotional one as well.  Higher tuition may mean that some students can no longer afford an education.  But in an era of stagnant, even declining government funding, tuition is really the only way institutions can raise the money necessary to maintain the quantity and quality of the education they offer.  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.

Principle 1: A wide range of quality programs

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.

Malaspina continues to meet the demands of Principle 1 by offering a wide variety of programs, including costly ones.  There were no outright program cuts last year.  Malaspina suspended the intake in one program and put this program and three others under "administrative review."  However, the reviews were less a result of concern about program cost than about the demand for the program and its graduates.  The conclusion has now been reached that all the programs will continue, although with some modifications.

The Ministry has arranged with Malaspina to expand Nursing, Practical Nursing, and Computing Science-all high-cost programs.  Malaspina is committed to providing many more student spaces in these programs.

The Ministry has also directed Malaspina to increase its overall production of FTEs with no increase in the grant.  It is a fact of life that it is easier to do this by expanding programs that are comparatively less expensive-and this will be done.  However, some of the new programs that Malaspina will be introducing this year do cost more than average. 

Principle 2: Affordability

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.

Malaspina belongs to national associations such as AUCC (Association of Universities and Colleges of Canada) and ACCC (Association of Community Colleges of Canada) that lobby for increased government funding of education in order to ensure access to education of high quality. 

For its part, Malaspina put $500,000 in the base budget last year to establish special bursaries and offset government cuts to student support.  This is a major commitment and it seems to have had the intended effects.  The special bursary fund provided $500 each to all 209 "high need" students and $300 each to all 320 "medium need" students and as of December had a few dollars to carry forward. 

While Malaspina is proposing to increase fees again, it is also proposing to set aside more money that will go directly to students.  Although this is not a long-term solution to affordability and declining government funding, it is what Malaspina can manage right now.  To go further than this would encourage disputes about whether some student should be paying significantly higher fees to support lower fees for others.  Some would say this kind of income redistribution is properly the responsibility of elected governments, not educational institutions.

Principle 3: Simplicity and consistency

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.

Implementing this principle produced major changes last year.  The difference between upper-level and lower-level courses was eliminated and vocational fees were brought into line with academic fees.  Because a few career-technical programs did not have time to adjust their credit-heavy course requirements, they were granted a one-year continuation of the 36-credit per year cap on fees, but this cap is to be discontinued for 2003-04.  Malaspina now has a consistent charge for all its instruction from first year onwards.

Most ancillary fees were eliminated last year, although a gym charge continued through oversight.  It will be removed for 2003-04.  The only new user fee students have faced is one for out-of-class printing, and this is justified under the provision in the first bullet above-i.e., it will encourage more responsible use of a costly resource.

Perhaps the one failure in terms of this principle is the absence of tuition changes projected two years into the future.  Although position papers last year did project 20% increases for both 03-04 and 04-05, these projections were not included in the Calendar-and we now see the recommended increase for 03-04 is actually 29%.  Published projections are probably not very useful-and could be misleading.

Principle 4: Benchmarking

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.

Malaspina did considerable benchmarking as it developed its tuition policy last year.  In the end, Table 1 suggests Malaspina did a good job of meeting it targets.  Among university colleges, Cariboo was clearly highest and Fraser Valley lowest per credit fees, but Kwantlen, Okanagan and Malaspina are almost identical.  Malaspina continues to have academic fees that are below those of the universities. 

For monthly vocational fees, Cariboo is again highest and Fraser Valley lowest among university colleges, but in this case Malaspina is second lowest.  In fact, if one divides the monthly vocational fees by the academic credit fee, Malaspina has the lowest ratio-an indication that peers might judge Malaspina's monthly fee to be somewhat low.

Table 1:  Basic tuition fees for benchmark institutions, 2002-03

Institution

Per credit

Per Month

British Columbia Institute of Technology

78.00/97.001

 

University College of the Cariboo

92.332

346.25

Kwantlen University College

78.00

270.00

University College of the Fraser Valley

66.00/75.483

224.00

Vancouver Island University

79.00

237.00

Okanagan University College

78.00/85.804

246.00

Simon Fraser University

95.10/126.805

 

University of British Columbia

88.70

 

University of Victoria

93.206

 

1 BCIT tuition varies somewhat by program.  It is assessed by credit but with caps for a level (semester).  These figures are for a range of programs comparable to ones at MUC.

2 UCC has started to go to differentiated fees by program. These are the most common fees.

3 UCFV has a lower-division, upper-division distinction

4 OUC charges more for lab courses.

5 SFU has higher fee for Business, Computing Science and Engineering courses at the 200-level and above.

6 UVic has a list of specified courses that are more than this rate, by a multiplier that varies.

Principle 5: Cost-recovery and competitive international fees

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).

Malaspina currently follows the model of one per-semester charge for international students, whether ESL or regular programs, and whatever number of credits.  Some other schools, particularly universities, distinguish fees for ESL programs (often run through continuing studies) and regular programs, with higher fees for regular programs.

Malaspina did raise its international fees somewhat last year, and as the following table shows, is pretty much in line with benchmark and competing institutions.  Only Cariboo, among university colleges, charges substantially higher fees.  Among universities, UBC charges much higher fees for regular programs, and UVic is substantially higher than SFU and the university colleges.

Table 2: Basic international fees for benchmark institutions, 02-03 (and 03-04)

Institution

$$ per credit

$$ per Semester

British Columbia Institute of Technology

 

4,700-6,545

Camosun College

 

3,960 (4,350?)

University College of the Cariboo*

 

5,250 (5,800?)

Douglas College

290 (320)

 

Kwantlen University College

310

 

University College of the Fraser Valley

 

3,900 (4,425)

Vancouver Island University

 

3,900 (4,200)

Okanagan University College

 

3,675 (3,858)

Simon Fraser University

285.30

3,400 [ESL]

University of British Columbia

461 (516)

3,696 (3,810) [ESL]

University of Victoria

393

3,150 [ESL]

Notes:  The bracket figure () for UCFV, VIU and OUC is the September 2003 figure.  VIU's ESL tuition is currently $3900 and is not projected to rise.  The per-credit tuition for the university colleges is calculated from the semester charge divided by 15, the standard credit load for an FTE student.  Some international students may take more than 15 credits; some may take fewer.  UVic international students pay premiums for certain courses, just like domestic students do.  Those in commerce pay an extra $400 per semester (approximately $27 per credit). 

C.  Tuition Recommendations for 2003-2004

1.  Increase the per credit charge to $102

This is a 29% increase over the current charge of $79 per credit.  Budget analyses suggest this is the increase required to sustain current operations and to increase our activity to the level necessary to reach Ministry enrolment targets.  Unlike last year, there will be more seats at Malaspina in 2003-04.  This tuition increase is also in line with the increases others are anticipating.  UVic and UBC have already announced 30% increase to basic program fees and .  A $102 per credit rate will still leave Malaspina about $500 or more below UBC's and UVic's rates for basic university programs.  For some programs, the Malaspina advantage is considerably greater.

2.  Increase the monthly charge for full time vocational programs to $306

This change from $237 per month is the same 29% increase applied to academic and career-technical programs.  The new part-time monthly rate (60% of the basic rate) would be $184 per month. 

Given the evidence in Table 1, a tuition review in the coming year needs to consider whether monthly tuition should be somewhat higher than it is in relation to academic tuition.

3.  Remove the separate graduation fee

In its tuition principles, Malaspina is committed to minimizing add-on charges to students for specific services-unless the separate fee encourages more responsible use of that service.  As much as possible, tuition is supposed to be all-inclusive.

This year representatives of the Student Union asked that the graduation fee be considered for elimination.  Since this is definitely an add-on fee that serves no larger purpose, it is being eliminated.

4.  Charge standard tuition for high school graduates taking ABE courses

Current provincial policy prevents charging students for ABE courses.  But several institutions are preparing to begin charging tuition to ABE students who are already high school graduates or the equivalent.  The Ministry is considering allowing this option.

If allowed, the recommendation is that Malaspina begin charging high school graduates for ABE courses at the grades 11 and 12 levels.  The will be done by assigning three credits to all ABE courses at the 040 level and higher.  The tuition then will be the usual per credit charge of $102.

No one knows how this will work out.  The fees might greatly reduce interest in these courses by high school graduates.  The Registrar's office also has the problem of determining if someone is a high school graduate or has similar standing.

5.  Increase the Co-op Education fee to $452 per semester

This is a 29% increase over the current fee of $350.

Last year Malaspina increased its co-op fee about the same proportion as it increased fees overall.  It did this without knowing what other institutions would do.  As it turns out, $350 is at the low end of the range of fees for a co-op semester: BCIT $725 (50% of the normal 15 credits), Kwantlen $702 (9 credits), UVic $421, UCFV $396-452 (6 credits), SFU $403, UCC $350, OUC $250.

This proposal of $452 is approximately 50% of the normal rate of tuition for 9 credits, which is the normal credit value of a co-op semester.

6.  Increase student support by $125,000 to off-set some effects of the tuition increase

Last year, $500,000 was set aside to off-set the effects of tuition relief-$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 replaced funding that was cut by Government, while the $225,000 for tuition bursaries was new and was added to Malaspina's existing awards.

Adding $125,000 to this money this year will provide a further $75,000 for on-campus student employment and a further $50,000 for scholarships and bursaries.  This is a 25% increase overall to the money set aside last year and a 31% increase in the money that goes directly to students.

7.  Set international fees at $4,200 per semester (for Degree, Diploma, and Certificate Students).  ESL fees to remain at $3,900

Last year international fees increased from $3,600 to $3,900 per semester for both ESL and other programs.  At that time, International Education proposed to keep the ESL fee at $3,900 per semester for 03-04 and 04-05 but increase the fee for degree, diploma, and certificate students to $4,200 in September 2003 and to $4,500 in September 2004.  Although the Board only approved the fee increase for 2002-03, International Education has in fact been advertising the fee increases it projected.

At this point there is no obvious way to set international fees.  These fees vary considerably at other institutions and the consequences of these variations are not clear.  UVic has announced it will follow UBC and set very high fees for international students in regular programs-at the same time as it is likely to keep its fees for ESL students very low.  Most of the colleges are maintaining similar fees for all international students, regardless of program.  Obviously, international students respond to price differences and they have the whole English-speaking world to choose from.  But no one at present is in a good position to identify the optimum course of action.  Among the university colleges, Cariboo has by far the highest international fees and its enrolment was up 3% this year.  With lower fees, Malaspina's enrolment was up 30%. 

In this situation, the recommendation is that Malaspina stay with its published rate of $4,200 per semester for international students for degree, diploma, and certificate students for 2003-04, starting September.  Tuition for ESL students for 2003-04 will remain at $3,900. 

Besides the $4,200 rate for next year, Malaspina will stop publishing any commitment to $4,500 per semester in 2004-05.  International fees are changing too rapidly to make this kind of commitment.  As part of the review of differential fees, the task force on tuition (see next section) needs quickly to examine the establishment of differential fees for international students.

8.  Cost recovery and special program fees to be determined

The basic tuition levels that are recommended above are for base-funded (i.e., Government supported) programs delivered during the regular academic year in standards formats at Malaspina's primary campus locations.  Malaspina reserves the right to establish the fees of other programs at full cost recovery levels.  Base-funded programming delivered in unusual formats or delivered at unusual times or locations may also have extra fees to cover the higher costs.

D.  Looking beyond 2003-04-examining differential tuition

Having established a "level playing field" as far as tuition is concerned, there is now a need at Malaspina to examine the ways and implications of moving to differential tuition by program.  More and more institutions are starting to go in the direction of different levels of tuition for different programs-sometimes based on the costs the program, sometimes based on student demand for the program, sometimes based on the expected earning power of graduates from the program, and sometimes, of course, on combinations of two or more of these principles.

It may not make sense, practically or philosophically or politically, for Malaspina to move to different tuition for different programs, but the option needs to be examined.  If the option of differential tuition seems attractive, it will likely need to be associated with a number of other business practice changes in the institution.  Recommendations on tuition methodology will need to be ready by September 2003 if they are to be adopted for 2004-05.  Therefore, the Executive will soon establish a working group to make recommendations on several topics, including:

  • Should Malaspina move in the direction of assessing tuition differentially on a program basis?
  • If differential tuition seems desirable, what principles might Malaspina use to set tuition levels for what kinds of programs?
  • What other business practice changes might be involved in a move to program-based tuition?