The University Board of Trustees approved a 1.7 percent tuition hike on all three campuses for the 2014-15 academic year at its meeting in Chicago on Thursday, raising the base tuition rate to $12,036 per year on the Urbana campus.

The Urbana campus will see an increase of $202 in base tuition. The tuition rates for the Chicago and Springfield campuses will rise $178 and $158, respectively.

Incoming in-state freshmen are guaranteed this rate for four years, as part of the state’s guaranteed tuition law.

Christophe Pierre, vice president for academic affairs, said next year’s tuition rates will bring in additional revenue, “enabling us to improve access and ensuring some level of affordability and allowing us to provide financial aid to our students.”

University spokesman Tom Hardy said annual tuition increases recommended by the University and approved by the board are distributed in a variety of means.

“It goes to our core academic mission, teaching and research, it goes to pay salaries and run our physical operations,” Hardy said. “It is an unrestricted source of funding, and along with the state appropriation, it represents the core revenue stream.”

The 1.7 percent increase matches last year’s tuition hike, the smallest since 1994 and is set to remain in line with “national inflation indices and projections,” according to a University press release. This is based on the board’s inflation-neutral tuition-setting policy, which was set three years ago.

However, decrease in state revenue could potentially call for larger tuition increases in the future, Hardy said, and a drop off in state funding puts the board’s policy in danger.

“If the state cannot continue to provide revenue consistently, it is possible that (future) tuition increases might be greater than the rate of inflation,” Hardy said.

The board also approved a 2.3 percent increase in student fees on the Urbana campus, raising the cost of these fees to $2,984. This excludes student health insurance fees, which will be voted on at the board’s March 6 meeting.

The Urbana campus will also see a 2 percent increase in room and board costs. Based on a standard double-occupancy room and a 14-meal-per-week plan, the cost of housing is set at $10,180 for next academic year.

The combined cost of tuition, student fees and housing for the Urbana campus will increase 1.9 percent to $25,200 for 2014-15.

Board approves pension assessment resolution

Trustees approved a resolution requesting that University President Robert Easter and other administrators begin preparing to create a plan to compensate for the impact of recent changes to state pension legislation.

Under the new bill, a cap of $109,971 will be put on the amount of salary on which a pension benefit is based for all faculty; the University currently has this cap in place for new hires, but beginning June 1, it will apply to all employees.

Easter and other administrators will assess the impact of the pension legislation and create a supplementary pension plan that would allow the University to remain competitive in faculty recruitment and retention.

To supplement pension deficits, they will have to decide where the funds should come from.

“That is one of the things that they will make a determination on before they can make any recommendations to the board,” Hardy said.

At this time, there is no set date that the competitive pension plan will go into effect.

“The board would like to have a recommendation before June, so we will have to see what the process brings,” Hardy said.

Trustees elect officers

The board unanimously re-elected Christopher Kennedy as board chair at Thursday’s annual organizational meeting in Chicago.

“(There) was a very positive reaction to his extension as chair,” Hardy said. 

Kennedy became chairman when he was appointed to the board in 2009. The position of chairman is responsible for heading the 12-member board, which governs all three University campuses.

Kennedy is chairman of investment firmJoseph P. Kennedy Enterprises Inc., the founder and chairman of Top Box Foods, and from 2000-11, he served as the president of the Chicago-based Merchandise Mart Properties property managementfirm.

The board also re-elected the two remaining members of the board’s Executive Committee, Pam Strobel and Edward McMillan; Thomas Bearrows as the University legal counsel; Susan Kies as secretary of the University; and Walter Knorr as comptroller.

Each of these officers was elected to one-year terms. 

Board approves athletic director’s contract extension

Also at the meeting, the board approved a contract extension for the Urbana’s athletic director Mike Thomas, who will now serve until Aug. 28, 2019.

In August 2011, Thomas signed a five-year contract with the option for a two-year extension, pending a performance review after two years. After the review, Chancellor Phyllis Wise chose to extend the contract for three additional years, with the option for a two-year extension, pending future performance reviews.

Under Thomas’ direction, student-athletes had a 90 percent graduation rate in 2013, which tied for the highest graduation rate in University history.

He also played a role in helping the University reach a $60 million agreement with State Farm, which is helping to fund a $160 million renovation of the State Farm Center. 

Board also approved a proposal for the University to sell revenue bonds to further fund the arena.  

Lauren and MaryCate can be reached at [email protected].