In an attempt to accommodate continuing state budget cuts, Portland State University has instituted a tuition surcharge that effectively raises tuition by 10 percent as other Oregon Universities consider more increases.
The surcharge, a maximum $120 for full-time undergraduate students and $126 for full-time graduate students, is currently expected to last through the 2002-2003 spring term.
The tuition surcharge could potentially create a situation in which a majority of general-fund money comes from student fees and tuition instead of state funding, according to Jay Kenton, PSU vice president of Finance and Administration.
The university is making every effort to alert students to the tuition change, Kenton said.
“There’s a notice on the bills, and there’s a letter that Provost Douglas Samuels wrote included with the billing,” Kenton said.
The university still plans to reimburse students the surcharge value if Measure 28, a three-year income-tax increase, passes in a special election to be held Jan. 28.
But the financial situation in Oregon continues to worsen, dampening hopes that Measure 28 will pass.
“Between August 31 and November, the economy worsened from the biennial forecast,” Kenton said.
In response to the under-performing economy, Gov. John Kitzhaber signed an additional $9.5 million in budget cuts.
“Because of that next round of cuts, Oregon State University and Southern University are talking about adding another surcharge,” Kenton said.
PSU’s share of those cuts is $1.7 million, making the total PSU budget shortfall about $15 million.
Administrators at PSU have said they have no plans for an additional surcharge.
What makes these cuts especially hard to compensate for is their timing. Instead of being projected cuts for the future, these budget cuts affect the remainder of the 2002-2003 biennium.
With contracts and obligations for winter and spring term set, the only real way for Oregon University System schools like PSU to increase their revenues in time is to fall back on tuition increases and various operating-cost reductions.
Kenton explains that PSU has tried to opt for the latter, even going so far as setting aside 10 percent of the tuition-surcharge revenue for student aid.
“We try to keep our barriers to entry low, and price is one of the biggest barriers. That’s why we’ve taken some of that surcharge money and remitted it for financial aid,” Kenton said.
OUS schools are banking now on an upswing in the economy or the passage of Measure 28.
Without either, the surcharge could very well continue.
At the last meeting of the State Board of Higher Education, the body that approves temporary tuition changes, a number of board members expressed interest in removing the “null and void” clause written into the current surcharge proposal.
Removing the clause would allow the surcharge to remain after spring term, into the summer and beyond.
Neither a 10 percent tuition increase or a temporary tax increase are unheard of.
In response to a suffering economy with an unemployment rate above 12 percent, OUS schools raised tuition an average of more than 30 percent.
In addition, the 1982 Legislature voted for a temporary income-tax increase to compensate for the loss in revenues.