The comprehensive fee to attend Knox has grown to $60,144 for the 2020-2021 academic year, a 3.28% increase from the 2019-2020 year fee of $58,236.
President Teresa Amott announced the increase in a student-wide email Jan. 24, writing it “is similar to the past two years, the lowest year-over-year increase since 1974.” Knox’s comprehensive fee — which includes tuition, room, board and mandatory fees — has risen steadily year over year to meet increased costs of living and financial pressures.
“I think it is safe to say we do benchmark our tuition rate hikes so that we’re trying to stay in line with peer institutions,” said Vice President of Finances Paul Eisenmenger. “Affordability and accessibility have always been important values to Knox. We really just try to look at the tuition increases or room and board increases to cover costs increases as best we can.”
The main factors that Eisenmenger attributed to the upcoming increase included the Illinois minimum wage increase that went into effect at the start of the new year, debt service for a loan Knox took out for the SMC A-Core renovation, medical insurance claims for Knox’s approximate 400 employees and a drive to increase faculty salaries.
“We benchmark against the Associated Colleges of the Midwest (for faculty salaries) so we’re trying to be competitive within that peer group but that will continue. We’re lower in that peer group than we want to be. So there’s a little bit of catch up that we’re wanting to do,” Eisenmenger said.
The fee increase also is part of an effort to reduce Knox’s deficit and prevent the school from becoming overly dependent on an unreliable revenue source: the stock market.
Knox collects revenue from three sources: the student comprehensive fee, donors and returns from investing the Knox endowment. As student enrollment and retention has dipped, Knox’s operating costs have surpassed its revenue. Eisenmenger said the school has been covering that shortfall with the endowment, but that the school is pulling from it faster than they would like to.
“You don’t want to be drawing out (from the endowment) more than what’s going in, and right now we’ve had a bull market or a rising market for close to little over a decade and markets correct. And we’ve been seeing declines just with the virus that originated in China that all of sudden spooks the market,” Eisenmenger said.
Besides increasing costs for students to meet the deficit, the school is also looking at ways to cut costs. Knox currently does not have a hiring freeze, but it is reviewing each empty position to determine if it is necessary to be refilled.
“The other thing is, can we operate leaner so that we’re actually cutting costs? The hard thing there is you don’t want to operate so lean that the student experience of your education is compromised,” Eisenmenger said.”
The equation in which funding is allocated or removed between departments is also a constant process.
“The budget belongs to the college, not the individual,” said Eisenmenger. “That’s hard for a lot of institutions or a lot of places because again it’s like, ‘You’re cutting my budget.’ We’re never really — bear with me here — are we really ever cutting somebody’s budget or are we deeming that, because of institutional priorities, we are allocating it in a different way? It’s a both-and.”
How much the tuition is increased by is determined by research done by Eisenmenger’s Financial Affairs office, a recommendation made by the Institutional Planning and Priorities Committee, which is then reviewed and approved by the Board of Trustees. Once it is approved, the fee increase is reviewed by Student Senate for the sake of transparency.
Eisenmenger said tuition increases most years, typically within 2.5-4 percent. For the upcoming year, Eisenmenger wants the education to be as affordable as possible, but a disparity between the school’s costs and revenues will place pressure on the school to ask for another tuition increase.
“It’s hard to envision a year that our costs don’t go up,” Eisenmenger said. “I think the challenge for us more immediately is just to try to hold the line as much as we can, the increases. We are a not-for-profit school. We’re not trying to raise profits to pay dividends to shareholders, or bonuses to executive leadership. Everything we do goes back into the college. And so it’s a pure model if you will, because we’re really just trying to strike a balance. ”