An update from President Sands on tuition and fees
To Virginia Tech students and families,
As a student at Virginia Tech, you expect a university experience that prepares you for a successful life and career and a degree that is internationally respected for quality and value. Delivering on that promise while also improving access and affordability is an ongoing effort that includes planning our budget every two years (a biennium), based on the Virginia General Assembly’s approved budget for the commonwealth.
The General Assembly has yet to approve a budget for the biennium, which begins July 1. They are currently in recess and are scheduled to reconvene on April 11. On March 26, the Virginia Tech Board of Visitors approved a base tuition and fee rate increase of 2.9%, contingent on the Commonwealth of Virginia approving a budget that includes funding for the university that is aligned with our projections. If the 2.9% increase holds, it will be the third year in a row of the smallest increases this century.
To put 2.9% in perspective, it is between the Consumer Price Index (CPI-U) for the 12 months ending February 2018, which was 2.2%, and the 2017 Higher Education Price Index (HEPI), which was 3.7%. The CPI is a “basket-of-goods” inflation index, while the HEPI is more heavily weighted to the cost of talent, as is appropriate for institutions of higher education. In the specific context of Virginia Tech, the HEPI aligns better with the rapidly growing mandatory expenditures associated with the Virginia Retirement System and health care.
To further moderate tuition and fee rate increases, Virginia Tech has expanded the Funds for the Future program in recent years. This program ensures that an entering first-year student who comes from a family with adjusted gross income less than $75,000 continues to pay the same net tuition for four years. For students from families with adjusted gross income between $75,000 and $100,000, increases are partially offset. At the same time, Virginia Tech is budgeting $4.1 million in additional financial aid for the upcoming academic year after adding $9.7 million since fall of 2014.
Since 2000, the Commonwealth of Virginia has decreased Virginia Tech’s General Fund appropriation per in-state student by 46% in real (CPI-U adjusted) dollars. Although there has been some stabilization in recent years, the state appropriation per Virginia undergraduate student for instructional activities has not increased in real dollars since fall 2014. The cost of operating a university, however, continues to rise, including health care for employees and students and compliance with government regulations. While the state’s resources available for higher education are constrained, we are fortunate to have received recent investments in research and instructional capital projects, and appreciate the help in improving educational opportunities for our students.
To maintain the quality of our instructional programs, Virginia Tech is instituting or increasing program fees in fields of study that are more expensive to deliver. This will begin in the fall of 2018, and will apply only to new students, as they will see more of the benefits associated with advanced technologies, enhanced facilities, and academic support.
Going forward, continued efforts to achieve administrative efficiencies combined with increased philanthropic giving will ensure that the value of a Virginia Tech degree continues to escalate. Virginia Tech is already the most efficient of the 15 public four-year universities in the state with an administrative expenditure that is 14% of the total instructional expenditure, according to a July 2017 report of the American Council of Trustees and Alumni.
Our mandatory fees and our housing and dining costs are also the lowest in the commonwealth. Yet, there are opportunities to improve, especially as the university achieves scale through modest growth. From the philanthropic perspective, our friends and alumni are giving at a rate that is twice what they were giving two years ago, and it is making a difference. Just in this academic year, we have announced three gifts exceeding $15 million – three of the largest gifts in Virginia Tech’s history. Over $30 million from those individual gifts goes directly to scholarships that will enhance both access and affordability.
Finally, I will note that the demand for a Virginia Tech degree continues to grow. We received 32,000 applications for the entering class of fall 2018, more than 5,000 above the fall 2017 total. Application numbers have grown by 60% over the past four years. Virginia Tech is known for the work ethic of our graduates, our commitment to Ut Prosim (That I May Serve), and high-value degree programs that are designed to prepare students for the future. Our commitment to the Beyond Boundaries vision for Virginia Tech ensures that our university will maintain that edge for generations to come.