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Differential equations

Differential tuition increases, which the Board of Visitors discusses Thursday, bear the stamp of the school’s internal financial model

University administrators confirmed this week that they had scrapped a proposal to charge an additional fee for upperclassmen.

The proposal, according to a draft of the University’s financial plan that University President Teresa Sullivan and her staff released in March, called for third- and fourth-year students in the College, the Education School, the Nursing School, the Batten School and the Architecture School to pay $2,000 a year more than the base undergraduate tuition rate. The program would begin in fall 2015.

The University abandoned the idea after receiving criticism from the Board of Visitors, “which will discuss tuition and fee increases in its Thursday meeting. Board members, worried about in-state tuition affordability, wondered if the proposal amounted to a tuition hike in the guise of a fee.

These concerns, which give the needs of in-state students primacy, are worth raising. But the Board could have rejected the upperclassman fee proposal on other terms entirely.

The reasoning behind charging higher tuition to upper-division students, according to the March draft of the financial plan, was that third and fourth years benefit from “smaller class sizes, rigorous capstone courses, greater faculty engagement, and increased research opportunities.”

These reasons would be compelling if all third and fourth years enjoyed such benefits. But this is not the case. Smaller class sizes, rigorous capstone courses, greater faculty engagement and, arguably, increased research opportunities all go hand in hand. A student in a distinguished majors program or a similar program is likely to enjoy a small capstone course taught by a professor. Such a case would meet all four of the University’s conditions for a reasonable upperclassman tuition increase if the student also completed research for an honors thesis or seminar project.

But not all third and fourth years are likely to take advantage of such opportunities. And these opportunities are not evenly distributed. Small courses taught by faculty appear more frequently in the humanities and social sciences than in the natural sciences. Part of this disparity comes from the distinct needs of different disciplines. A seminar on ancient philosophy might require the expertise of a faculty member and also a small class size. A course on neurodegenerative disease, which would be less oriented toward discussion and more oriented toward mastering information and concepts, could sustain a larger class size without much damage — apart from the fact that students would most likely not enjoy the same level of closeness with a faculty member that a small class would offer.

So differential tuition for different years is off the table — for now. The concept of an upperclassman fee, however, could be worth revisiting in the future, if the University makes a concerted effort to ensure that third- and fourth-year students take advantage of the benefits the March draft report mentioned.

But the Board Thursday will likely approve other types of differential tuition. For one, it will discuss school-based differential tuition. The Commerce School already charges higher rates. And Engineering students, barring a surprise Thursday, will find themselves paying $2,000 a year more than the base undergraduate tuition rate beginning with the class entering this fall. Tuition for graduate students differs school by school, but the one thing nearly all graduate students have in common is that their rates are going up.

Less discussed, however, is differential tuition based on geographical origin. The University has proposed a 2013-2014 out-of-state undergraduate tuition rate of $39,844, an increase of 4.8 percent or $1,826.

The University’s enthusiasm for expanding differential-tuition programs — and its stated reasoning for upperclassman fees — comes from the same ethos that drives the development of the school’s new internal financial model. The model aims to treat each school or unit as a separate cost center that must generate revenues to cover its expenses.

Differential tuition is where the University appears to be heading. Though the Board is currently unwilling to extend differential tuition to different years, it has betrayed no such reservations about school-based or geography-based differential tuition. The differential approach toward tuition bears much in common with a decentralized financial model. A degree in history will not cost as much as a degree in engineering, the reasoning goes, because historians, by and large, demand lower salaries than engineers, and the equipment and infrastructure a history class requires is less expensive than what is necessary for an engineering course. The University can thus justify charging more for an engineering degree. It’s a matter of a more expensive unit covering its costs.

That logic, which seeks to align spending with revenue generation, does not apply as well to geography-based differential tuition. In-state students pay less because their tax dollars go toward funding the University via the General Assembly. But dwindling levels of support from the state are a primary reason for tuition hikes. Nonetheless, it is out-of-state students, not in-state students, who bear the brunt of tuition increases. The surplus that families of in-state students have already “paid” through taxes as Virginia residents grows more narrow as state funding for the University declines, but the gap between what out-of-state students and what in-state students pay grows wider. When it comes to differential tuition for out-of-state students, the internal financial model’s logic breaks down. Out-of-state students do not cost more to educate. The University charges them more simply because it can. Geography-based differential tuition does not come from a desire to align fees with expended resources but a desire to balance a budget on the backs of non-Virginians.

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