Indiana State University trustees on Friday approved a 1.4% increase in tuition and mandatory fees for each of the next two years.
For 2021-22, tuition and mandatory fees for the academic year will be $9,598 for full-time, in-state undergraduates; for 2022-23, it will be $9,732. That includes student recreation center fees and a student health and wellness fee.
The increases are $66 per semester in 2021-22 and $67 per semester the following year.
The additional revenue will be used to to maintain academic quality and meet operational expenses, said Diann McKee, ISU senior vice president for finance and administration.
The increase "is in line with nonbinding tuition targets established by the Indiana Commission for Higher Education," she said.
The increases are below the three-year compound annual growth rate in the Consumer Price Index for the Midwest Region, which is 1.45%, she said.
McKee said ISU's tuition/mandatory fees remain the lowest in the state for four-year public universities with a statewide mission.
During an earlier finance committee meeting, Trustee Ed Pease raised concerns about university options should inflation continue to worsen.
Trustees also approved a 2021-22 general fund budget of $174.2 million, a decrease of $11.2 million from this year's budget, which is $185.4 million.
Much of the decrease and revenue decline can be attributed to enrollment declines — including the impact of COVID-19 as well as smaller ISU cohorts or class sizes.
According to ISU, the reduction in budgeted tuition revenue "is inclusive of a 1.4% increase in tuition and mandatory fees ... and a [$9.6 million] adjustment for actual Fiscal Year 2021 and projected Fiscal Year 2022 enrollment declines."
According to McKee, ISU also paid off a large bond issue this past year, which meant a $2.8 million reduction in its state academic debt service appropriation.
The state operating appropriation remains flat for next year, but increases by $2.4 million the second year of the biennium.
The 2021-22 budget proposes a 1% pay increase for employees with satisfactory work performance, but a final determination on pay raises won't be made until after fall enrollment is known.
The budget includes a 1.4% increase in university-provided student scholarships, and $8.4 million internal re-allocations to provide a balanced operating budget.
McKee said that significant budget cuts have already taken place, and many vacant faculty and staff positions have been left unfilled to give the university flexibility.
She said her ISU colleagues "have done an extraordinary job" the past year in controlling expenses.
With the new budget, which begins July 1, ISU will primarily continue to operate as it has been for much of the past year, McKee said.
Jeff Taylor, trustee chairman, praised the administration and McKee for doing a "terrific job" of managing ISU's finances and keeping the university in the black despite the difficult situation created by COVID.
McKee also told trustees during a finance committee meeting that the university would be able to use federal stimulus funding to make up for "some of the income loss on the housing/dining side because of reduced enrolment" for the 2020-21 academic year.
In another financial matter, trustees approved a resolution authoring the university to proceed with steps necessary to refinance two housing/dining bond issues, with projected savings of $3 million.
The university wants to take advantage of current low interest rates. Refinancing would require approval of the Indiana Finance Authority and state budget director; before it is finalized, it is also subject to review by at least one board of trustee member.
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