Differential Tuition Initiatives

Background

As part of its 21st Century Study, the Board of Regents encouraged institutions to pursue differential tuition rates for unique programs with strong demand or special operating costs.

Since that time the board has approved differential tuition rates for a number of programs including Evening MBA and Pharmacy programs at UW-Madison, Allied Health programs at UW-Milwaukee and UW-La Crosse and customized instruction programs at UW-Stout.

In addition to those program-specific initiatives, the Board has approved differential tuition rates for broad categories of students at four institutions: UW-Eau Claire, UW-Colleges, UW-Stout and, in December 2003, UW-Whitewater. UW-Eau Claire, UW-Colleges, and UW-Whitewater's differential tuitions are applied to undergraduate students while the UW-Stout differential is applied to all students.

UW-Eau Claire was the first institution to get the ball rolling on differential tuition rates at the institution rather than program level. It set its differential tuition as a flat dollar amount, and that amount has not increased since that time. The institutions that came later to the process set their differential as a percentage of traditional tuition so that the differential tuition amount increases each year as tuition increases are approved by the board.  In this way, they are able to preserve and perhaps expand on the buying power of the resources generated through their differential tuition.

Finally, the Board has approved requests by 5 institutions to charge graduate enrollments during summer session on a per credit basis by removing the plateau. This could be considered a "differential tuition"; as it falls outside of the traditional tuition format.

Process

Chancellors are required to present all differential tuition initiatives to their fellow chancellors at two separate Administrative Staff meetings before they may be presented to the Board of Regents. Student involvement in the process is defined in Board policy and includes the following components:

1. Students will be advised through their student government organizations of all planned differential tuition initiatives before proposals are submitted to the Board of Regents
2. To the extent possible, UW System institutions will consult with students directly affected by the proposed differential tuition initiative
3. Differential tuition initiative proposals presented to the Board of Regents will include a section on the student consultation process and outcome, as well as any official stance forwarded by the student government organization
4. The Chancellor of the UW System institution, in consultation with the President of the UW System, will make the final determination whether a differential tuition initiative is submitted to the Board of Regents for approval; student approval is not a requirement for the initiative to be forwarded to the Board of Regents
5. Spending decisions related to the funds generated by the differential tuition are ultimately the responsibility of the Chancellor of the UW System institution as indicated in s. 36.09 (3) Wis. Stats.

Requests to the Board of Regents should include the following information:

1. Proposed Special Tuition Rate. Expressed as it is intended to be collected: either as a percentage tuition increase or as a flat dollar increase.
2. Expected Resulting Revenue. Provide this for the first year of the program, based on increase over current tuition rates; if it is a phased multi-year initiative, make a projection over the life of the program, cumulating prior year increases.
3. Enrollment Assumptions. If the differential tuition is targeted toward a specific subset of total student enrollments, please indicate the definition and size of this subset. If the enrollments affected are expected to vary over the life of the program, please indicate this and provide calculations.
Peer Analysis. For increases applying to at least one of the standard tuition categories of students (i.e., all resident undergraduates, all resident graduates, non-resident undergraduates, non-resident graduates, Law, Business, Med/Vet students), please include in the proposal information showing where this will place the institution compared to peer tuition midpoints (latest midpoints are attached). For other program-specific initiatives, please indicate where the proposed tuition will put the institution in comparison with similar programs in the tuition peer group and/or typical competitors for such programs.
4. Market/Student Demand Data. Indicate how this proposed tuition level would be expected to affect overall student demand for this program. Please also explain how such changes in demand fit with the institution's overall enrollment management target and goals.
5. Rationale of Use of Funds. Please describe the specific needs to which these revenues will be applied.

Consideration by the Board of Regents may require two separate readings, with the first being for information purposes only and the second for action, or both steps may be taken at the same meeting.