Penn sees 3.9-percent increase in undergraduate tuition

The cost of a Penn education is on the rise.

At its stated meeting on Friday, the Board of Trustees approved a 3.9-percent increase in undergraduate tuition. Undergraduate costs for tuition, fees and room and board for the 2012-13 academic year will total $56,106 — an increase from $53,976 in 2011-12.

Last year, overall student costs also increased by 3.9 percent.

Though this year’s tuition hike will affect undergraduates across the board, it does mark Penn’s second-lowest increase in the past 44 years, according to Penn President Amy Gutmann.

At the same time, the trustees announced on Friday that the overall financial aid budget for undergraduates will increase by 7.7 percent — the same rate as last year — to $181 million.

Of the $15.6 million in net tuition revenues, $5.6 million will be allocated toward financial aid, according to Vice President for Budget and Management Analysis Bonnie Gibson.

While many of Penn’s peer institutions have not yet announced tuition for the upcoming year, tuition at Stanford University will increase by 3 percent, while Cornell and Princeton universities each plan to raise tuition by 4.5 percent.

“If you benchmark against our peers, we’re below average in the increase in costs and we are way at the top as far as our financial aid policy goes,” Gutmann said. “We want to make sure that we fulfill our commitment to making a Penn education accessible to all undergraduate students with demonstrated financial need.”

According to Gutmann, tuition funds account for just 70 percent of the direct costs of a Penn education.

“The large part of our costs [go toward hiring] highly talented faculty who could write their check in anywhere,” she said.

Students’ current financial-aid packages will not be affected by the tuition increase and will continue to be based on demonstrated need, according to Gibson.

“We do our best to predict what we believe our financial budget should be in any given year,” she said. “We have needed more money than we had in the budget for every year in the past five years.”

Director of Student Financial Aid Bill Schilling explained that this has largely been due to the increasing number of students with need and grant eligibility as a result of the economic recession.

During Fiscal Year 2011, which ended June 30, 2011, 53 percent of all aided undergraduates and 57 percent of all incoming freshmen received grants of at least $35,000 per year, he said.

“The increase [in tuition] is not going to be the tipping point for a whole lot of students,” Schilling said. “If it is, we’ll address it.”

For regular decision applicant QP Wang — a senior at Rutherford B. Hayes High School in Delaware, Ohio — “the unparalleled education and unlimited opportunities of Penn is what sets it apart.”

“Slight tuition increases will not cause me to displace another college for Penn,” he wrote in an email.

However, he added that students who are less certain about their top choice school — particularly those from middle-income families — would be more likely to think twice about applying with the tuition hike in mind.

Regular decision applicant Devasia Manuel — a senior at St. Columba’s School in Delhi, India — feels that tuition increases at schools like Penn are particularly significant for international students who do not fall under the University’s need-blind admissions policy.

He wrote in an email that “international students are likely to complete their education in their home countries if they feel that the cost associated with Penn does not guarantee the same returns after graduation in the form of job prospects.”

Top Colleges Educational Consultant and Admissions Strategist Steven Goodman — a 1989 Graduate School of Education graduate — believes that leading universities like Penn should break the trend of tuition increases, especially in light of potential cuts in government funding.

Tuition hikes “mask the need for the university to simply cut spending in a way that will enable it to efficiently serve the students who come to Penn.”

At the same time, he added, reducing tuition “would communicate to future applicants that Penn genuinely welcomes middle-class students.”

Related

Interactive: Penn total costs 2003- present
International students face large financial burden
Financial aid proves key factor for middle-income applicants
Penn defends rising tuition

Cost of Penn education to rise 3.9 percent

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