RD191 - 2015-16 Tuition and Fees at Virginia’s State-Supported Colleges and Universities


Executive Summary:
Analysis of tuition and fees at public colleges and universities in Virginia must include a discussion of the funding received from the General Assembly. The period covered by this report represents a particularly complicated scenario that impacted not just higher education but all entities that receive general fund tax dollars in Virginia. The first goal of the Virginia Plan for Higher Education, the statewide strategic plan for higher education recently developed by SCHEV and endorsed by the legislature, is to provide affordable higher-education access for all. The alignment of state appropriations, financial aid and tuition and fees will be critical to achieving this goal.

The 2014-16 biennium saw Virginia and all of its state-supported agencies, including our public institutions of higher education, in an all too familiar funding position—the front seat of a roller coaster about to head swiftly downhill. In January 2014, the General Assembly began its regular session (in even-numbered years legislative sessions are scheduled for 60 days and in odd-numbered years they last 45 days) with a budget introduced by the Governor that included a revenue balance from the prior year of over $500 million and moderate revenue growth projection rates. However the legislative session ran longer than its scheduled 60 days due to a budget impasse and by June it became clear the state was going to end FY2014 with a budget shortfall of $350 million primarily due to an under-collection of non-withholding payments. This revenue shortfall quickly increased to $1.55 billion for the biennium. The General Assembly budget leaders addressed the anticipated budget shortfalls by identifying more than $900 million in spending cuts and tapping the Revenue Stabilization Fund, or Rainy Day Fund as it is called, to address the estimated shortfall. On June 12, lawmakers passed the 2014-16 biennial budget (Chapter 2), ending the three-month budget stalemate and thus averting a potential government shutdown. The result for Virginia public higher education was that institutions received virtually no new funding.

Following the preliminary close of FY2014, the Governor reported that the fiscal year actually ended with a revenue shortfall of nearly $438 million, which was larger than the previous estimate. The shortfall difference triggered the Code of Virginia-mandated revenue reforecasting process. On August 15, 2014, the Governor presented a revised revenue forecast to the Joint Money Committees based on the recommendations of the Joint Advisory Board of Economists and the Governor’s Advisory Council on Revenue Estimates. Afterwards, the Chairmen of the House Appropriations and Senate Finance Committees began working with the Governor’s office to develop an interim budget to address the shortfall. On September 18, 2014, the General Assembly adopted the revised budget (Chapter 3) to close the additional budgetary shortfall of $882 million mainly through budget reductions to state agencies. As a result, the general fund support for educational and general programs (E&G) at Virginia’s public institutions was reduced by $45 million in each year of the biennium or about 2.1%.

The 2015 General Assembly began its regular session with a promising revenue report that the year-to-date general fund revenue collection exceeded the projection and the state economy and job growth was improving. Hence, the General Assembly amended the 2014-16 biennial budget (Chapter 3) by adding more than $600 million in general fund support over the budget level. Virginia public institutions of higher education were provided an additional $34 million in general fund for E&G programs in FY2016. However, this addition did not offset the prior budget reduction for FY2016. The total general fund support for E&G programs in FY2016 is still 0.8% below the original budget. As a result, tuition and all mandatory fees for in-state undergraduate students will increase by 6.0% in FY2016. These charges increased by 5.8% in 2014-15 and 4.3% in 2013-14.

This report focuses on tuition and fees for in-state undergraduates and provides a summary of the following four items: 1) board-approved tuition and fee increases for the 2015-16 academic year; 2) tuition and fee trends in Virginia over the past 25 years; 3) the cost-sharing relationship between the state and students; and 4) trends in tuition increases nationally. The appendices provide comparisons of changes in tuition and fees for student groups including in-state undergraduate, out-of-state undergraduate, in-state graduate, out-of-state graduate, in-state first professional, and out-of-state first professional.

In order to assess trends in tuition and fees, it is important to understand higher education pricing. A student planning to attend a public college or university in Virginia can expect to pay the charges defined as follows:

1. Tuition and Mandatory E&G Fees: Mandatory student charges used to support instruction and education-related activities included in the Education and General (E&G) program. E&G subprograms include instruction, research and public service, academic support, student services, institutional support, and the operation and maintenance of physical plants.

2. Mandatory Non-E&G Fees: Mandatory student charges used to support non-instructional activities, such as student health services, athletics, recreational activities, campus transportation, and capital debt service.

3. Tuition and All Fees: Sum of tuition, mandatory E&G fees, and mandatory non-E&G fees.

4. Room and Board: Optional charges used to support the dormitory and dining functions for students choosing to live on campus. Students living off campus are exempt from these charges.

5. Total Price: The total charge to students and parents, excluding student financial aid. This total includes the sum of tuition, all mandatory fees, and room and board.