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Tuition Reset

  • Tuition Reset
  • Out of Pocket Savings

Tuition Reset

In the fall of 2013, Concordia University, St. Paul dropped its published tuition price $10,000 to $19,700 for all new and returning undergraduate students, what we call a Tuition Reset. We listened to student and parent demands for action on college affordability, researched and planned for several years, and then moved from a high-tuition/high-discount tuition model to a low-tuition/low-discount model. The result has been real, measurable savings for Concordia students and a transparency in our 'sticker price'.

We calculated the out-of-pocket costs (costs after scholarships are applied, before loans) for students in 2013-14 and found an average savings of $2,542 compared to what the costs would have been before the tuition reset. Multiply that over four years! Further unseen savings will come from applying any necessary tuition adjustments to a 33% smaller starting point; a 3% increase on $19,700 is less than that of $29,700. Scholarships, grants and loans now cover a greater percentage of the cost of attending Concordia and make a CSP degree even more valuable.

 

Why We Did It

Concordia's vision is to provide outstanding value by offering an education of high academic quality that is reasonably priced so that our students can achieve personal and career success. We recognize that the growing reliance on student loans nationwide can lead to accumulated debt that impedes many graduates' efforts to build financial security for themselves. Concordia heard the demands of students and their families to take real action on college affordability.

Concordia itself was in a position of strength when we moved ahead with the tuition reset in 2013-14, with record enrollment numbers and higher academic profiles in the years leading up to our tuition announcement. But the economic recession had eroded the financial situations of many students and families we serve. As a result, Concordia for several years increased the institutional scholarship and grant aid awards along a trajectory that was simply not sustainable. So we decided to respond with a relevant and real solution.

How We Did It

Concordia has a culture of fiscal prudence and a strong history of effective strategic planning, conservative forecasting of revenue growth, and careful attention to expense management. We have a diversified revenue stream, thanks in part to our cohort adult degree-completion and graduate programs, and have disciplined ourselves over the past decade to operate with low overhead and to rely on the core operating revenues of tuition and auxiliary services. Concordia spent three years intentionally planning for and creating the specific conditions that would allow us to reset our tuition.

The decrease in tuition was accompanied by a decrease in our discount (institutional aid), but our move from a high-tuition/high-discount model to a low-tuition/low-discount model lowered our students' net cost when compared to the annual 4-percent increase they would have otherwise experienced. It also brought our traditional undergraduate program into greater alignment with our cohort and graduate programs, which from their inception have operated with a low-tuition/low-discount model.

The tuition reset was revenue neutral for Concordia given projected enrollment levels. The short-term cost to the university of including returning students in the tuition reset was absorbed by Concordia through operations, donations to the annual fund and endowment.

What Happened

Every new and returning student saw a reduction in their total out-of-pocket tuition costs. In fact, when we calculated the out-of-pocket savings for all full-time students in 2013-14, we found an average savings of $2,542 compared to if we hadn't reset tuition. (Out-of-pocket costs are the price of tuition minus any grants or scholarships received.) For students who qualify for need-based financial aid, Federal Pell and Minnesota State grants stretched to cover a greater portion of their tuition expense. And the amount of loans needed to pay for out-of-pocket costs was therefore reduced, as well. Those are real savings, especially when calculated over four years.

With our tuition price rolled back to what it was a decade ago, Concordia is one of the most affordable private universities in Minnesota and the Concordia University System. The average net cost for our students is comparable to many of the region's public universities. In resetting tuition, nothing was cut or eliminated from the Concordia educational experience in or out of the classroom. So retaining the high quality of education while reducing tuition costs has made a Concordia degree even more valuable.

Enrollment at Concordia climbed to an all-time high following news of our tuition reset, indicating that the market of higher ed is, in fact, looking for transparency in pricing and moves toward affordability. Concordia's spring 2014 enrollment reached 3,652, up from 3,015 the previous year. Retention rates have also climbed.

"Given the socio-economic background of many of our students, these numbers (retention rates) are refreshing and help us measure our progress on our goal to increase retention and persistence to graduation," said Concordia President Tom Ries.

 

Featured article covering Concordia University's tuition reset:

Minnesota Public Radio's All Things Considered: Concordia University cuts annual tution by $10K

Coverage of the success of the tuition reset

on our tuition reset reaction page.


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