Tuition set to increase 5%

Tuition set to increase 5%
The price of an Augustana education adjusted for inflation. Blue indicates tuition, and yellow indicates room, board and fees. Graph by Slater Dixon.

Tuition will be raised by 5% for the 2023-24 academic year, increasing the cost of tuition by $1,817 per student, according to a breakdown provided by  CFO Shannan Nelson.

The combined total of tuition and fees will increase by 4.95% from the current academic year.

The increase was broken into separate categories. Tuition itself increased 5%, room and board increased 3.54% and the student activity fee increased 2.97%. The total increase in price including all categories is 4.68%.

That’s a 35.28% increase since the 2013-14 academic year for tuition alone.

“This is where we felt we could be,” President Stephanie Herseth Sandlin said. “That doesn’t mean that every student will experience a commensurate increase in what they end up paying. It varies by students in a private university.”

This raise trumps the previous tuition increase of 4% that took effect the 2022-2023 academic year. That increase was the first to come after the tuition freeze caused by the COVID-19 pandemic.

“The tuition freeze isn’t the only aspect of why it is being raised,” Nelson said. “One of the things we look at is our historical pricing on a 10-year average.”

Nelson said that the increases over the last 10 years have averaged to around 3% per academic year.

In deciding to raise tuition, Augustana’s Board of Trustees also looked at the university’s net tuition and fee calculations, both of which affect school-sponsored and donor-given scholarships.

“The total amount of scholarships have grown in the last two years by 10%,” Nelson said. “The other items that really go into it are the overall expenses of the university. About 70% of the university’s revenue comes from tuition and fees. That’s what we look into, what kind of growing costs and expenses we need to cover.”

In an attempt to financially support students, Herseth Sandlin said Augustana will continue building Impact scholarships, which are awarded every year to students based on the amount in the fund and students’ needs.

“We raised about $315,000 in the first year and have about 25 recipients this year of first-year students,” Herseth Sandlin said. “We want [students] to get it all four years, so we don’t make a commitment to them in year one that we then can’t follow up with. So we’re spreading out the $315,000 while we keep raising money for that Impact scholarship pool so we can use it more strategically year over year.”

The Board of Trustees also considered Augustana’s competitive price rate in South Dakota, Minnesota and Iowa in its decision to raise tuition.

“If we look at our regional peers, we are in the lower-third quartile, so our cost of attendance for this year was just over $46,000,”  Nelson said. “That’s between a range of $28,000 to $76,000. When you look at it that way, we are competitive with about 50% of state schools, and we are less expensive than about two-thirds of the private schools.”

ASA President Sara Alhasnawi said she was concerned about the financial burden that may arise for students who do not have access to the scholarship opportunities or for international students.

“My hope is that we keep stressing to administrators that we need increased opportunities for scholarships,” Alhasnawi said. “Hopefully, some of those opportunities can become more visible to students because I can see how this can disproportionately affect students who are low-income or coming from international countries.”

Although scholarships are rising alongside the tuition, Alhasnawi is pushing for scholarships to be more visible for prospective and current students.

Alhasnawi said she is also concerned about employment opportunities that Augustana will provide for international students.

“If we’re having this increase, I’m assuming students are going to be looking for more job opportunities,” Alhasnawi said. “So I think [ASA is] right now trying to establish new positions that are open to all students and hopefully also visible among those who are most affected, like the international freshman who are limited to only working on campus due to their visa.”

Some international students have said they are still worried about paying for tuition with high inflation.

“The federal government has increased the interest rate six times this year to get inflation under control,” junior international student Manusmriti Budhathoki said. “That means the value of the dollar goes up in the international market. Since last year, my currency has devalued 11.86% against the dollar, meaning my regular tuition is already 11.86% higher than what I paid last year. This is the case for almost every international student. The 4.5% tuition increase is an extra burden on us.”

While Herseth Sandlin said inflation doesn’t have a direct effect on rising tuition, it does affect the overall expenses of the university, which in turn impacts tuition rates.

“Inflation has affected the overall budget and the complexity of fund accounting,” Herseth Sandlin said. “When you put together the overall budget of the university, we know that we’ve experienced increases in certain areas.”

Under the Viking Bold plan, Augustana is expected to implement more tuition increases for the next three to five years.

“I think Augustana can anticipate increases of 2-4% annually,” Nelson said. “Our goal is to have a similar increase in scholarships like we’ve had over the last two to three years and following that same growth pattern.”