The University of Alaska Board of Regents passed a 5 percent tuition increase for next academic year in a 7-3 vote Wednesday afternoon, rejecting a larger tuition hike recommended by the UA administration.
"I do think we're kicking the can down the road, so to speak," said Regent Gloria O'Neill who voted in support of the smaller increase to student costs at the Anchorage meeting.
UA President Jim Johnsen had recommended the board increase tuition by 9 percent starting in fall 2016. That increase would have generated about $11 million in additional revenue to help cover a fourth of a projected $41.4 million budget shortfall triggered by an increase in fixed costs. The university system had an additional $15.8 million cut imposed by Gov. Bill Walker's administration.
Johnsen said after the meeting Wednesday he believed the regents' softening of the tuition increase accurately reflected public testimony provided by students that morning.
"I think the students stepped up today and I appreciate that commitment they made to their university," he said.
The 5 percent tuition increase will generate roughly $6 million. UA will have to find ways to make up the rest of that money, said Jo Heckman, chair of the regents board, who supported the 5 percent increase.
"I put a lot of stock into our students and their opinions," she said.
UA students already pay tuition costs this year at a rate 5 percent higher than the past year after regents approved a tuition hike in February.
Jonathon Taylor, president of the Union of Students at the University of Alaska Anchorage, said in the "perfect world," students wouldn't face a tuition increase next year. However, he said he and others recognized the current fiscal problems of the state.
The Union of Students passed a resolution in September saying it endorsed a 5 percent tuition increase next year, bracing for budget cuts.
"Student representatives and the student body were saying, 'This is what we are able to do to help cope with the fiscal realities,'" said Taylor, a senior majoring in political science.
Last week, the Union of Students at UAA passed another resolution saying it did not support a 9 percent tuition increase in response to the administration's proposal.
"It was really nice to see that we were able to have an impact," Taylor said after the regents' meeting.
Since 2003, UA tuition has more than doubled. In that same time, the cost of living in Anchorage rose just over 30 percent.
A UAA student who took 30 credits of lower-division classes in 2003 would have paid $2,700. This year, that student pays $5,490. Next year, a student will pay about $5,764, according to tuition rates provided by Michelle Rizk, chief budget officer for UA.
Johnsen said UA still has some of the lowest in-state tuition rates in the country, paired with increasing financial aid provided to students.
Tuition rates vary across some campuses and levels of classes, as well as by residency status. The 5 percent tuition increase will apply to all tuition rates, Johnsen said.
Regent Kenneth Fisher voted against the tuition increase and said the university system had to first look at creating a more sustainable budget before relying on upping students' costs.
"My preference would be a sustainable budget," he said. "I'd rather do that than burden Alaska students and their families."
After passing the 5 percent student increase, the regents also passed a $960 million operating budget that included nearly $378 million from the state -- 7.6 percent more than last year.
Johnsen said that budget represented what the university system needed to sustain operations and meet contractual obligations to pay its employees.
The budget will move as a proposal to Gov. Bill Walker and the Alaska Legislature. In the meantime, UA will work on various contingency plans to address additional possible cuts, he said.
"This is not a wish-list budget at all," he said of the budget passed. "I want to be able to tell our story to the Legislature."
Heckman said UA typically takes into account projected cuts. However she said Johnsen has had time to talk to state lawmakers who showed support for UA bringing them a budget that reflected what the university needs to operate.
"Right now we're saying, 'This is our best case scenario,'" she said.
The budget will get changed many times over the next several months, Heckman said. O'Neill stressed to Johnsen that the regents must remain involved in shaping the budget each step of the way.
As one of the last agenda items Wednesday, regents also passed a capital budget that included a nearly $35 million state funding request to complete the engineering facility at the University of Alaska Fairbanks.