College tuition bills growing at slower rate

10/19/2005

Students and parents can expect some relief this year when it comes to paying college tuition bills: The 2005 price increase grew nationally at the slowest rate since 2001.

But they'll still feel a pinch to the pocketbook as the average 7.1 percent increase remains well above the general inflation rate, according to an annual report released yesterday by the College Board.

Prices for tuition and fees at four-year institutions rose to an average of $5,491 per academic year, while those at two-year public colleges climbed by 5.4 percent to $2,191. At four-year private, nonprofit colleges, costs jumped by 5.9 percent to $21,235.

In Ohio, the legislature capped tuition increases under the national average at 6 percent, or $500 - whichever is less - for the 2005-2006 academic year.

In Michigan, though, students will pay more than the average with increases ranging from 7.5 percent to a high of 18.5 percent at Wayne State University.

Locally, officials said they're trying to offset the increasing cost of college by offering more institutional scholarships and aid packages to students. That's especially important because some federal and state grant programs have not increased with inflation, said Craig Cornell, the director of financial aid at Bowl-ing Green State University.

BGSU this semester debuted an online financial aid estimator that allows students and parents to get a realistic view of the cost of college. It also links with more than 900 possible scholarship offerings.

"The reason we created it is these studies come out and continually show that students overestimate, especially high-need students, the cost of going to college," he said. "This gives them a straightforward look at what's out there."

At the University of Toledo, officials also are trying to educate students about available institutional aid. That comes after less than half of the available $2.5 million in need-based aid was used by students this fall. Similarly, $4.5 million of a possible $10 million in merit-based aid was accepted, said John Nutter, UT's director of institutional research.

"Some of that word is getting out, but it takes some time to develop a reputation of generous financial aid," Mr. Nutter told some of UT's trustees yesterday.

While total financial aid is increasing, loans still accounted for more of the growth than grants for the third consecutive year, the College Board said in its report.

Students have to pay back loans, but not grants.

James Boyle, president of the group College Parents of America, said schools and policy-makers aren't working hard enough to hold down costs.

"The beat goes on with increases in colleges costs, and parents are growing weary of the same old tune," he said.

Average debt for undergraduate borrowers is now $15,500 - a figure experts consider manageable for most students, given that college graduates can expect to earn nearly $20,000 more a year than high school graduates.

Still, increases in borrowing raise concerns that some students will be priced out of college, drop out, or graduate but stay away from low-paying public service jobs so they can repay debts.

"We have deserving students who are being kept out of college or have difficulty completing degrees because of a lack of money," said Gaston Caperton, president of the nonprofit College Board, which also owns the SAT college entrance exam.

The results come as Congress is negotiating a new version of the Higher Education Act, which would set federal financial aid policy for the coming years.

A House version passed last month increases some grants, but critics say it would harm borrowers by cutting $9 billion from student loan programs.

College Board officials and university presidents devoted much of a news conference announcing the results to concerns over college access for poor students, who - even if they have high test scores - earn college degrees at significantly lower rates than rich students.

They also criticized the proliferation of popular state programs that award college grants based on merit, not need.

While state spending on need-based aid has increased, merit-based aid has grown faster in recent years, College Board and university officials noted. Merit aid went from 10 percent of all state aid in 1993 to 26 percent by 2003, the most recent year for which figures are available.