Planned double-digit increase puts costs in line with rivals, administrator says

Des Moines Register
January 23, 2007

By Lisa Rossi

You can forgive Grinnell College students and their parents for wistfully thinking about the good old days, when tuition increased only 5 percent or 6 percent a year at the prestigious Iowa school.

The campus is abuzz with plans for what the college calls a 12.6 percent “market adjustment” that will be phased in over four years, starting this fall with incoming freshmen.

The proposed increase comes at a time when Grinnell’s tuition and fees – $29,030 this school year – are already nearly $10,000 a year higher than average for Iowa’s private, four-year colleges and universities. The cost of a Grinnell education is $20,000 a year higher than the cost at Iowa’s three public universities.

Grinnell President Russell Osgood said the planned increase would bring the school into line with the tuition charged by Grinnell’s main competitors for students – Carleton College in Northfield, Minn., Macalester College in St. Paul, Minn., and Oberlin College in Oberlin, Ohio.

“We’ve been reporting a significantly lower tuition than the schools we immediately overlap and compete with,” Osgood said. “At the same time, we are the highest-cost school in the group.”

The added revenue will also allow Grinnell to increase the amount of money that goes toward financial aid, thereby helping students from families of modest means graduate with a smaller college loan debt, officials said.

Ten percent of Grinnell’s 1,500 students come from families with incomes high enough that the students do not qualify for financial aid, the school said. That means those students will feel the full effect of the higher tuition.

Grinnell’s board of trustees is expected to approve the higher tuition when the board meets Feb. 9 and 10. Besides the “market adjustment” of $4,200, the trustees also will be asked to approve what officials said will be a “modest” tuition increase that will be applied to all students.

The double-digit increase – compared with 5 percent to 6 percent increases in the past four years – is the talk of the Grinnell campus.

“Across the board, students are frustrated,” said Chris Hall, 21, a senior from Sioux City who is Grinnell’s student body president. He said students have lobbied school officials for more student-loan forgiveness and other financial aid. But such a large increase is going to have a “major impact,” Hall said.

Osgood said the higher tuition should help the college reduce or eliminate student loans among its graduates.

“The goal is, no one will graduate with loans,” Osgood said. “We believe we are the only school that is pursuing the strategy.”

In the spring of 2006, the college paid down $214,000 in students’ loans. Under the new tuition plan, the college is considering whether to increase its loan forgiveness to between $250,000 and $350,000 for the spring of 2008.

Grinnell’s tuition increase comes amid concerns nationwide about college costs.

The U.S. House of Representatives recently voiced its concern about the size of students’ college debts. The House passed a bill recently that cut the interest rates on need-based federal student loans for undergraduates.

Grinnell students already graduate with less debt than students at public schools. They typically leave campus with $16,744 in loan debt, compared with nearly double that amount at Iowa State University.

Nationally, private-school tuition and fees increased between 4 percent and 6 percent in the past five years. In Iowa, tuition increases at private schools ranged from 4 percent to 6.7 percent, according to the Iowa College Student Aid Commission.

While Grinnell’s double-digit increase is unusual, the school is not alone in proposing an increase of that size.

Baylor University raised tuition by 33 percent in 2002-03; the University of Richmond raised tuition 26.9 percent in 2005-06; and Rice University raised tuition by 12 percent for 2005-06, according to the National Association of Independent Colleges and Universities.

“These increases haven’t hurt enrollment, because the institutions are well-performing institutions to begin with,” said Tony Pals, an official of the association. “They all do a very good job of explaining to their prospective students why tuition is where it is.”

One official who follows college tuition suggested that Grinnell’s increase is an effort by the school to preserve its reputation as one of the nation’s elite colleges.

“There’s a sizable segment of the American population that equates price with quality,” said Steven Roy Goodman, an official of Top Colleges, a Washington, D.C. college admissions consulting company.

Grinnell’s planned increase will put the school’s tuition and fees at $33,230 for new freshmen this fall.

The average tuition this school year at Carleton, Macalester and Oberlin – the three colleges that Grinnell considers to be its primary competition – already exceeds $33,000.

One factor in the reaction to the size of Grinnell’s planned increase is the school’s wealth. Grinnell College’s endowment fund is about $1.2 billion – nearly four times as large as the University of Iowa’s $295 million endowment, the next-largest endowment fund at an Iowa school.

TUITION COST: Grinnell College tuition and fees ($29,030 this year) are nearly $10,000 a year higher than the average for Iowa’s private colleges and universities. However, a tuition increase would bring Grinnell in line with its competitors across the country, said Grinnell President Russell Osgood.

TUITION INCREASES: Grinnell’s double-digit tuition increase is unusual. Nationally, private-school tuition increases ranged from 4 percent to 6 percent over the last five years.

STUDENT DEBT: Grinnell students typically leave campus with $16,744 in loans to repay, compared with nearly double that amount at Iowa State University.

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