University of Minnesota saying OK to 15% tuition hike for nonresidents

The University of Minnesota is moving ahead with a 15 percent tuition hike for most out-of-state students, despite concerns that it may scare away potential recruits.

The proposal, which would boost the sticker price for nonresidents to $28,734 next fall — a $3,748 increase — was endorsed by a committee of the Board of Regents Thursday, and is expected to be finalized Friday.

It would be the second double-digit increase in a row for out-of-state undergraduates, who saw tuition rise by 12.5 percent this fall. The change would not affect Minnesota residents, or those from Wisconsin and the Dakotas, who now pay $12,800 a year at the Twin Cities campus.

“If you look at what a degree costs for [nonresidents] at our peer institutions, ours is lower,” said President Eric Kaler, who recommended the increase. “I think this tuition price reflects the value that a University of Minnesota degree can command in the marketplace.”

Last year, the regents set a goal of gradually raising the nonresident rate, one of the lowest in the Big Ten, to about $35,000 a year by 2021, roughly the midpoint of its peer group. Under the new plan, it would hit that mark by the fall of 2019.

University administrators said they would limit the increases for current students to 5.5 percent a year, but that new students would pay the higher rates. The U will wait until spring to set next year’s rates for Minnesota residents.

For several years, some regents and state legislators have been calling for a dramatic boost in the U’s nonresident rate, arguing that they pay too little while Minnesota residents pay too much. But a number of regents and student groups have raised concerns that steep hikes would unfairly burden many families, and undermine efforts to recruit top students from other states.

Since 2011, out-of-state tuition has grown by 50 percent, from $16,650 to $24,946 a year, for undergraduates at the Twin Cities campus. It increased 7 percent in 2015 and 7.5 percent in 2016 before jumping by 12.5 this year.

The university said it expects to raise an additional $8.8 million under the new tuition rates. But at the same time, they say applications and enrollment from other states have dropped in the face of recent tuition hikes, and that it plans to increase spending on recruitment and scholarships to ensure a steady stream of students.