In October 2012, following months of discussion and analysis, the Roger Williams University Board of Trustees adopted an initiative called Affordable Excellence^®. These two words reference a host of actions devoted either to making an RWU education more affordable to a broader cross-section of families of high school graduates hoping to enroll at a high-quality private university, or to enhancing the quality of that education even beyond its already very high level.

In recent years, the parents of prospective college students have become openly critical of the relentless increase in the cost of higher education at a rate significantly greater than the growth in median family income. In response, a handful of campuses have, in the past several years, moved away from the system for pricing tuition that has been responsible for these dramatically rising costs: the so-called “high-cost/high-aid” model. (Nevertheless, despite widespread criticism from the press, politicians and parents of a model that relies on significant annual increases in published tuition prices, the overwhelming majority of private colleges and universities continue to use “high-cost/high-aid.”)

Most of the campuses that chose to use a different model did so because they had experienced significant enrollment shortfalls in previous years, and, in order to encourage more applications for admission, most elected to “reset” the posted tuition at a substantially lower price point. In almost every instance, however, these institutions also reduced their financial aid budgets proportionately: the list price for tuition was lower, but the net price – the amount the typical student paid – was essentially the same. Many observers quite rightly noted that the result was a classic case of “a distinction without a difference” – the cost to the students and their families was the same as before the reset. Additionally, these campuses subsequently went right back to having annual tuition increases: they did not abandon the “high-cost/high-aid” model at all, but instead restarted the model from a lower price point.

Roger Williams University enjoyed strong enrollments in years previous to 2012, but we recognized that if we continued to raise our tuition, the cost of attending our university would, over time, outstrip the financial capacity of the students we were endeavoring to serve. Moreover, we were only too aware of the projected decline in the number of high school graduates in the Northeast over the next decade, meaning that competition among colleges and universities for new students would become even more intense than in previous years.

Accordingly, we approached the idea of increasing our affordability in a way quite different from any other university to that time: for the entering class of 2013 (and for all of our continuing students still enrolled that year) we froze tuition at the 2012 level ($29,976) and we guaranteed that tuition would not increase for those 2013 freshmen during their four undergraduate years, thereby making the four-year cost of an RWU education far more predictable for students and their families. At the same time, we began increasing the amount of institutional financial aid from $38 million annually to $45 million, and directed the bulk of these increased funds for high-achieving students with demonstrated financial need.

Unlike campuses that undertook a one-time reset of their tuition (or, much more commonly, that did nothing at all to address their rising costs), Roger Williams University extended its frozen tuition model for the entering class of 2014, and we have recently announced that the tuition will remain frozen at the 2012 price for the entering class of 2015. In addition, the four-year guarantee that tuition will not increase is being applied to the entering classes of 2014 and 2015 as well.

But while we understand that price is important, what is even more important is the perception (by the student and his or her family) of the investment value of the student’s college education. So, unlike any of the other colleges that have been focused exclusively on controlling cost, we at Roger Williams also focused on enhancing the demonstrated quality of an RWU education. Specifically:

• We greatly expanded the number of Living Learning Communities in our residence halls, as a means of helping students with their transition from high school to college.
   
• We are completing a comprehensive overhaul of our General Education Core Program, ensuring consistency in learning outcomes across all courses and sections in each of the five distinct curricular areas of the Core.
   
• We have systematically increased the number of students involved in project-based, “real-world,” learning (internships; research with faculty; participation in community-based projects through the Community Partnerships Center and other entities) in order to ensure that students are graduating with practical experience in their field(s) of study.
   
• We are undertaking a redesign of our Career Center – now called the Career Investment Center – to work with and mentor students at a far earlier stage in their undergraduate studies.
   
• We are creating a new “one-stop” Center for Student Academic Success, combining offices in advising, tutorial, student advocacy and accessibility services that were previously housed in different buildings.
   
• We are moving to a cloud-based system for housing software, thereby saving students hundreds (in some cases, thousands) of dollars by giving them the opportunity to use inexpensive tablets in place of high-end laptops.
   
• The Library is being transformed into the Learning Commons, combining both traditional library services with technology services and assistance in a single location.
   
• We continue to advise our students to major in something they love, but to minor (or double major) in a program that is complementary to their major. For example, dance or theatre majors may find it challenging to earn a living as a performer – but combining their major with a minor in arts management will allow them to be involved in the business end of the arts. Similarly, even though engineering or construction management students find themselves quickly employed after graduating, for their long-term career interests we encourage them to minor in business or in one of the liberal arts.

We are often asked how we have been able to enhance the quality of our students’ educational experience and expand our financial aid budget, even as we hold the line on tuition – the single largest source of revenue for almost every college or university. (Some of our competitors have suggested that we must be short-changing our students in terms of the quality of their education – how else could we cover inflationary increases?) In short, what’s the catch?

I fully understand the skepticism from those who believe that there is no such thing as a free lunch. Surely there must be some hidden, but significant, negative impact on our students from our decision to hold tuition flat, now for three years in a row. If it were easy, wouldn’t everyone be doing it?

Well, I never said implementing Affordable Excellence would be easy. But our Board of Trustees would never permit us to jeopardize the quality of our academic programs and our hard-won reputation for excellence just to hold the line on tuition increases. They have – quite rightly – insisted on seeing how our annual budget projections justify any decision to hold tuition flat – and they review the end-of-year numbers very carefully to ensure that we did, in fact, meet our budget projections.

So how do we do it? First, we start with the goal of not increasing our tuition as we begin the budget planning exercise for each new academic year. We create specific targets for the numbers of (and net revenue from) new freshmen, new transfer students, new graduate students and new continuing education students (the last group are mostly adult students, taught at our Providence campus in face-to-face, blended or entirely online classes). We set goals for the retention of freshmen students to their sophomore year as well – and we target growth in our summer school programs (who wouldn’t want to be a summer school student at RWU and experience the pure pleasure of summer in Rhode Island on a campus situated on an arm of Narragansett Bay?)

We further enhance our revenue from tuition with summer rental of our facilities for camps and conferences – and we have been successful in significantly increasing our philanthropic support from some incredibly generous benefactors (including the parents of more than 30 percent of our current students!).

On the expense side, we have been successful in very substantially reducing the portion of our budget dedicated to debt service (to repay bonds we took out in past years to construct new buildings) by refinancing these bonds at significantly lower interest rates. Money freed up from mortgage payments is then used to support financial aid and our academic and student life programs.

I cannot promise that we will never increase our tuition price. We are taking things a year at a time. But the irony is that, far from “leaving money on the table” (as one of my presidential colleagues said, in reference to our decision not to increase tuition), we have been pleased to see higher yields (the percentage of students who are offered admission and who ultimately enroll), and higher freshman-to-sophomore retention rates. The result is, in a year (Fall 2014) when 42 percent of private colleges failed to meet both their enrollment and their revenue targets, RWU exceeded our targets in both categories. We have the largest number of undergraduate students on our Bristol campus in our history (slightly more than 4,000). We are earning less money on each student, but we make up for that decline by having more students.

In short, Affordable Excellence has, to date, been a resounding success at Roger Williams University. We have also demonstrated that, if a campus truly wishes to do so, it can enhance its quality even as it holds the line on price.

At Roger Williams University, we believe that higher education is too important to our country’s continued economic success to limit it only to those with substantial financial resources at their disposal. To be sure, we are not inexpensive – but each year that we hold the line on tuition, we become just slightly more affordable to those prospective students and their parents who are seeking the greatest educational value for their money.

In my last post, I posed the dilemma of how a campus could freeze tuition (as Roger Williams University has chosen to do), thereby eliminating a logical source of new revenue, without somehow causing damage to the quality of the students’ educational outcomes. Isn’t it the case that “you get what you pay for” – and if you pay less, doesn’t that ensure that you will receive less?

Of course, most people recognize that the quoted statement is overly simplistic. A person can spend anywhere from about $15,000 to more than $200,000 for a new car, but most people don’t think that it is worth it to spend extravagantly on a car, if their primary goal is just to have reliable transportation. Similarly, one can purchase a perfectly respectable bottle of wine for $10 to $20, although it is also possible to spend more than $200 for a grand cru from Burgundy. Is that bottle worth 10 or 20 times the first bottle? As a practical matter, not to most people.

Nevertheless, when a college freezes tuition – or, more dramatically, actually reduces tuition (as a handful of campuses are now doing) – it is not unreasonable for a student or parent to wonder how and where the campus is reducing its expenses, since the campus’s total revenue will presumably not keep pace with inflation.

We debated the idea of a tuition freeze at RWU for some months before proceeding, because of our concerns about perception: would this move be interpreted as an act of desperation? Would it be seen as inevitably leading to a reduction in educational services and quality? It wasn’t until we were satisfied that we had sound answers to these concerns that we elected to move ahead.

We knew (and anyone can easily verify) that our enrollments have been strong in recent years, and presumably would have continued strong, even if we had not frozen tuition (although New England will be seeing a significant decrease in high school graduates in recent years, a fact that will undoubtedly cause stress at many colleges and universities in our area). Nevertheless, our actions were not that of a desperate institution.

But we also wanted not just to maintain our level of educational quality, but actually to enhance it. We wanted demonstrably stronger educational outcomes, especially in job and graduate school readiness. How were we to achieve these objectives without the revenue that would result from raising our tuition price?

The answer is central to our story. Just as many countries in Europe are finding it very difficult to cut their way to prosperity through extreme austerity measures, we knew that reducing our expenses was not the route to improving quality. That’s not to say that we shouldn’t be appropriately frugal, and regularly check to ensure that we are using every dollar to best effect – and we are doing just that. But it would take more than being tight with a dollar to get to where we needed to be.

What we have elected to do is to diversify our revenue stream. Rather than rely almost entirely on tuition, we are expanding some of our alternative revenue streams, even as we create new ones:

• We are increasing the use of our campus in the summer – a spectacular time of year in Rhode Island, especially for a campus on the water – by expanding our academic offerings for students, and by introducing new programs for high school students and for working professionals.
   
• We are dramatically expanding our School of Continuing Studies, located in Providence, partly to meet the skills gap of adult workers, and partly because, even with lower tuition for students in non-residential programs, we derive a modest amount of net revenue that can be used to subsidize the costs of our high-cost residential campus.
   
• We have developed a series of contracts with communities and the state to provide, for a fee, the services of our Community Partnerships Center – services that benefit the communities while they enhance the skills and expertise of our students.
   
• We are redoubling our philanthropic efforts, a task made easier because our donors applaud our efforts to increase both affordability and quality.

In short, we are doing what any business would do when it plateaus: we are developing new product lines, and with them, new revenue streams.

“You only get what you pay for?” Our objective at Roger Williams University is to ensure that every student gets more than what he or she pays for, by developing revenue streams that augment what we charge the student in tuition.

“You can’t have your cake, and eat it, too?” You can, at Roger Williams University – and you can bet that, as we prove successful, other institutions will follow our lead. We’re fine with that. As our mothers told us when we were children, “Imitation is the sincerest form of flattery.” And it’s past time that American higher education changed direction. Success at Roger Williams University will blaze the trail.

In my next blog post: Colleges that are heading in the opposite direction.