Two congressmen plan to introduce legislation that would force both private and public colleges to keep their tuition increases at a level comparable with the rate of inflation.
Rep. Howard "Buck" McKeon (R-Calif.) and Rep. John Boehner (R-Ohio) introduced legislation two weeks ago that would control what they believe are drastic tuition hikes at U.S. colleges.
Congress is currently reauthorizing the Higher Education Act of 1965, and this bill would be an amendment.
There is no vocal opposition to the actt yet, but Steve Forde, spokesman for Boehner, said that once solutions to the problem begin to be discussed, opposition is highly likely.
If the proposed amendment succeeds, the Department of Education will monitor tuition increases over a three-year period to ensure that prices do not rise at a rate twice that of the Consumer Price Index. The index is used to show the cost of living and how prices of goods have changed over time.
If a university was found in violation, it would have to explain its need to raise prices at such a rate and submit a proposal to halt these increases to the Secretary of Education.
Also, if a university did nothing to curb its costs over the next two years, it would have to make its spending information available to the public. Sanctions would also be instituted, including reductions in federal funding and financial aid programs.
Nana An, AU's executive director of Budget and Payroll, said these penalties "will eventually hurt needy students" by cutting colleges off from receiving financial aid.
If passed, the amendment would take effect in 2008, with 2011 set as the first year when sanctions would be implemented.
At AU, students have seen an increase of 6 percent in tuition over last year's rate and will see an additional 6 percent raise next year, according to AU's Budget Office. This is in contrast to the 2.2 percent raise in the Index from August 2002 to 2003, according to the U.S. Department of Labor's Bureau of Labor Statistics. If the amendment was in effect, AU would have to report to the Education Secretary why this increase occurred and possibly face sanctions.
Basing tuition on the Index is unrealistic, according to An.
"Running the University's budget is a little different than going to the grocery store," she said.
AU accounted for several expenses when making up the budget for this school year and next, An said. This includes money to fund President Benjamin Ladner's 15-point plan for improving AU, establishing the Office of International Affairs, funding technology improvements such as wireless Internet and improving the Student Health Center, she said.
Each year's tuition increase is set by the Board of Trustees and is released in February, she said. When making up each year's budget, An said AU compares itself to more than 40 schools that the Office of Enrollment Services considers competitors, including Emory and George Washington universities.
"For the last few years we've been lower than our competitors," she said.
Several expenditures simply increase more than the Index, An said. These include buying new library materials and paying faculty at a competitive rate.
"We spend a tremendous amount of time setting pricing," An said. "We don't set them arbitrarily."
The University has taken steps to decrease its budget, An said. These cost-cutting measures include reallocation of unused funds from different departments, staff realignments, the new credit card policy (which saves the University $700,000) and "some savings in publications or mailings," An said.
The tuition proposal is based on a report recently drafted by Boehner and McKeon. The report, entitled "The College Cost Crisis," has sparked serious debate in Congress.
The findings of the report are highly critical of the country's universities, which it charges increase tuition rather than managing their budgets efficiently.
The report said that since a college education is necessary today, colleges have not had incentive to spend money responsibly.
Boehner and McKeon said it is important for colleges to keep tuition increases at a minimum to make college degrees available to more people.
Seventy percent of those polled for the report said that colleges are becoming unaffordable for the average American family, according to the report. Since 1981, the average college's tuition has risen 202 percent - more than double the Index for that time period.
Financial aid funding is the fastest-growing part of the University's budget, at 18 percent, An said. Currently, AU pays for 29 percent of the average student's cost of attendance through financial aid, she said.
Boehner and McKeon found that increases in federal financial aid actually increase tuition. This leads to an increase in federal aid and contributes greatly to rapidly increasing tuition.
