Idaho State University will start a new tuition lock program keeping freshman year prices the same for all four years. It's designed to save student's money, but there's a hidden cost to the plan.
ISU's announcement of their tuition lock program came with plenty of fanfare. But it lacked solid numbers on how the program would be funded. The State Board of Education - who needs to approve the plan - released some of that info today.
"This institution firmly believes the savings to students under tuition lock proposal,” said ISBOE spokesman Blake Youde. “They are able to cover through the university's financial reserves."
Here's a simple version of the plan:
Pretend this year's freshman class expects to pay a $1,000 for tuition. That's what they pay for all four years. But the university expects the cost to provide an education to increase.
So next year's class will shoulder a bigger bill. Let’s call it $1.3K, and so on and so forth for future classes as expenses rise.
With this example, the first cohort saves nearly two thousand dollars over the years. But the real cost of educating them - the savings for the student - has to come from somewhere. Right now, ISU says it will eat that expense.
"That is a cost that ISU believes can be absorbed through their reserve funds right now," said Youde.
Below you can see the actual numbers ISU is estimating.
The university could offset these costs by increasing enrollment of future students paying higher rates, but they would need to maintain a high growth of 20 percent to even out. That, in the end, leads to big questions if the actual cost of education continues to rise -- like if and when the state will need to pony up the difference.
But this is a pilot program and time will tell if tuition lock lives up to its promise of a more affordable education.
