The rising number of verified coronavirus cases has many colleges confronting a bleak truth: that despite their initial plans, the fall term will likely be virtual.
Hosting classes almost exclusively online isn’t a move institutions relish making. Students overwhelmingly prefer face-to-face courses, research shows. And administrators fear that students and families unwilling to pay regular tuition costs for a digital course load, or without a compelling campus experience, will further jeopardize their already uncertain enrollments.
Fewer students would mean less money at a time when institutions’ budgets are imperiled. And so in recent weeks, several colleges have reduced the cost of attendance as a way to appeal to students.
Not every school can afford to reduce tuition, however. Experts who study higher education policy say institutions are likely doing so for one of two reasons: either they’re prominent enough and their finances are in good enough shape that they want to help struggling students, or they’re in such rough financial straits that they want to ensure they’ll fill their seats come fall.
Williams College, the wealthiest liberal arts school in the U.S. with a $2.9 billion endowment, falls into the former category. It was the first major college to announce a cut — a 15% reduction in tuition and room and board for the upcoming academic year, circulated at the end of June. Family contributions for students who receive financial aid were also downsized by 15%.
Maud Mandel, president of the Massachusetts college, wrote in a letter explaining the changes that the college’s fall sports teams wouldn’t compete this semester and that typical campus events would be limited. The college eliminated its student activities fee entirely. But officials plan to reopen campus.
In the weeks following, Princeton University said it would mark down tuition by 10% for students learning on campus and remotely. Georgetown University, in Washington, D.C., and Lafayette College, in Pennsylvania, also announced 10% tuition cuts for students who are studying remotely.
Several historically Black colleges and universities also announced tuition and fee reductions, including Hampton University, in Virginia, Spelman College, in Georgia, and Paul Quinn College, in Texas.
More recently, Rowan University, a public institution in New Jersey, knocked 10% off tuition.
Decisions to lower advertised tuition prices likely weren’t made lightly, especially among heavily tuition-dependent private colleges, said Denisa Gándara, an education policy professor at Southern Methodist University.
Those institutions needed to weigh how many students they might gain by trimming tuition against the revenue lost by doing so, Gándara said.
Wealthy private colleges with diverse portfolios likely didn’t run such calculations, she said. For them, tuition reductions meant to “ease the financial burden on students.” Students would likely still attend an elite institution if it went online for the fall, because of its reputation. And rich private colleges rely on tuition for only about 15% of their revenue, whereas the average for their less-affluent peer institutions is about 30%, Gándara said.
Colleges that already heavily discount tuition, a persisting trend, won’t feel the same effects from reducing sticker price as colleges where a significant share of students pay full cost. The latter type of institution, however, will “definitely take a hit,” said Dominique Baker, an education policy professor at Southern Methodist.
More than 80% of undergraduates at private nonprofit institutions received institutional grant aid last academic year, which on average, covered more than half of posted tuition and fees.
With the costs associated with the pandemic piling up, administrators are finding their schools on especially weak financial footing.
Institutions have needed to determine whether students would even return for the fall, surveying them to gauge their interest in living on campus or enrolling in classes, Baker said. Colleges have been basing decisions to cut tuition on those findings, she noted.
For some colleges, cutting tuition now means to ensure their survival. By one recent estimate, 345 private nonprofit colleges could close within six years. Reducing students’ costs could help secure enrollment and, therefore, the revenue that these financially shaky colleges need to hold on, Baker said.
But she doubted whether tuition cuts would dig those colleges out of a financial hole in the long term. Returning to pre-pandemic pricing would be a hard sell for students and families, especially considering the anticipated pandemic-related financial stress they will be under for years, Baker said.
“It’s sort of similar to creating a federal policy that gives money,” Baker said. “Once people are used to their subsidy, it’s incredibly challenging to pull that away.”
Are there other options?
Institutions are also considering other help. The University of Southern California said it would offer up to $4,000 a semester to students who typically get financial assistance for housing but will live and study off-campus this year.
Boosting aid is a possibility, but only if an institution has significant cash reserves, Baker said. And officials can’t draw on endowments however they like, as they are largely restricted.
Colleges could instead try cutting fees, as Rutgers University did. It reduced its campus fee, which supports student services, by 15%. But fee reductions don’t often make the same splash among students as scaling back sticker price, Gándara said. Many families aren’t as aware of fees as they are of tuition, she said.
Colleges have taken advantage of this knowledge gap in previous years, keeping tuition stable as they ratcheted up fees. During the pandemic, not all colleges have gotten rid of fees, even if they’re not funding a full slate of events or programs.
A petition at Towson University, in Maryland, calls for the public college to eliminate its nearly $500 athletic fee because sports competitions were suspended this fall. Towson’s conference, the Division I Colonial Athletic Association, is one of the leagues that has ditched football out of concern over the coronavirus.
Still, most colleges will preserve their tuition and fee structures. Public colleges, especially, tend to have less leeway to set pricing, as it usually is determined by the state or governing entity.
Private colleges that slash tuition will likely do so because they’re shifting to virtual courses. But this could pose a problem if institutions don’t provide the necessary infrastructure and training for quality online education, said Justin Ortagus, a higher education administration and policy professor at the University of Florida.
Some administrators think online learning will be less expensive to deliver than in-person classes, and it can save money in the long run, he said. But the initial investment in online education — the technology and personnel — cost more than face-to-face instruction, Ortagus said. Several Minnesota colleges are charging more for some online courses, citing the extra costs of technology, training for instructors and test administration.
He worries colleges will try to cut costs this fall by not fully developing their online programming. And if they’re desperate and seeking more students, they may target some that are ill-prepared for the college environment, much less the self-directed learning required for online classes.
“Online education can be cheaper,” Ortagus said. “But it comes at the expense of students.”