Tuition and Fees Advisory Board co-Chair Kevin Marbury and Jamie Moffitt, the chief financial officer for the university, opened up the TFAB meeting to discuss updates regarding the Guaranteed Tuition model, the Reserve Fund and the Public University Support Fund on Friday.
Moffitt explained the Guaranteed Tuition model, which the university implemented this year. “Under our new program, students who join the university this year are paying a higher tuition rate, but it is locked and it’s not going to change for five years,” she said. “All of the other students are paying a lower rate that the board pre-approved to go up 3% per year.”
TFAB has updated the figures on the tuition guarantee model. Although the university has already set a 9.75% one-time increase for incoming students and a 3% annual increase for current students, the university is worried about financial risks.
If the university faces a large decrease in state funding, it would be a “crisis,” Moffitt said. “The state did not end up touching our main operating fund this year.”
The university can’t increase tuition more than 3% for current students because of the Guaranteed Tuition program. On the other hand, the tuition rates for incoming students can increase.
“You can’t increase that too high, otherwise people won’t come,” Moffitt said. “But you do have that one lever where you can start to increase rates on new students.”
Due to COVID-19 and a decrease in enrollment, Moffitt said the university is experiencing a drop in revenue. Last year, the board discussed setting up a reserve fund as a cushion for cuts in state funding. The reserve fund includes a total of $20 million, according to the updated Guaranteed Tuition program briefing. Over half of the total reserve fund is from donors.
The board will establish a recommended rate for the 2021-2022 cohort by examining changes in costs, revenue and enrollment predictions in January.
Related:UO will lock tuition rates, what does that mean?
Next, Moffitt discussed the Public University Support Funding. The PUSF is Oregon’s main direct funding contribution for higher education operations. It’s distributed through the Student success and Completion model, according to the UO Public University Support Funding brief.
The Higher Education Coordinating Commission uses a Student Success and Completion Model to distribute state funding to the seven Oregon public universities in three ways, according to the Oregon State website.
Moffitt talked about components of the PUSF, including the Mission Differentiation category. According to the 2019 Student Success and Completion Model document, “Mission Differentiation Funding supports the unique regional, research and public service missions and activities of each university.”
Moffitt said Mission Differentiation is problematic because she doesn’t believe it’s equitably distributed. “Some of the higher cost programs like engineering, student activity and performance dollars are weighted so that there are reimbursements because some programs are more expensive,” she said.
This year, UO received about $79 million in state funding and Oregon State University received about $240 million, according to the comparative university funding data. Based on the data, OSU received about triple the amount of funding compared to UO.
The total state funding per fundable student at UO totals about $6,000 and around $13,000 for OSU students, according to the comparative university funding data. Fundable students are primarily Oregon resident students, Moffitt said.
Outside of the PUSF, the university received funding from a Statewide Public Service Program Funding that OSU hosted, targeting public service missions.
“Task Force could not come to consensus on recommendations, but Higher Education Coordinating Commission staff used input and feedback from task force to develop recommendations for model changes to the Commission,” the UO Public University Support Funding brief stated.
Meeting updates and notes can be found on the UO tuition website. TFAB will meet Friday, Nov. 20.