Value of on-time completion award currently unknown

IU President Michael McRobbie announced last week a new award that will freeze tuition for students after their sophomore year if they are on track to graduate in four years.

However, because the 2013-15 operations appropriation budget has not yet been approved and tuition for upcoming academic years has not been finalized, it is unclear how much the award will save students.

Based on past tuition and mandatory fees, the award would have saved the classes of 2011, 2012 and 2013 an average of $1,343.44 for in-state students and an average of $4,954.84 for nonresidents.

Regardless of the net value of the award, McRobbie said it will help students in two ways: by reducing the sticker price of attending IU and by providing additional incentive for students to graduate in four years.

“This award makes two things clear,” he said while announcing the award during his State of the University address. “That we are serious about holding down the cost of an IU degree, and that we are equally serious about providing tools and incentives to help our students stay on course for on-time degree completion.”

Executive Vice President and Chief Financial Officer Neil Theobald reported that while operating revenue has increased by $400 million in just more than 6 years, all of the increase is from tuition. Revenue from the state and other sources has fallen by $20 million in the same time period.

“Every one of our five major sources of IU’s revenue is under pressure or threat,” McRobbie said during his address.

When McRobbie referred back to this statement at the Board of Trustees meeting, Trustee Pat Shoulders questioned him on the logic of freezing tuition when it is the only source of revenue for the university that is still increasing.

Thoebald defended McRobbie’s completion award, reminding the trustees of the issue of student debt. Fewer credits during time will lead to more student debt, he said.

“Student debt is the greatest financial issue facing IU,” Theobald said. “We need to find a way to have student debt levels flatten off and actually try to drive them down.”