DePauw announced a 5.9 percent increase in tuition this year, while another small, liberal arts college took a different approach: a 10 percent reduction.
Sewanee: The University of the South competes against DePauw in the Southern Collegiate Athletic Conference and, like DePauw, enrolls a purposefully small number of students in the private institution. Sewanee announced its decision to cut the 2011-2012 school-year tuition Feb. 16, attracting the attention of higher education and large media outlets, like the New York Times and The Wall Street Journal.
"It came out of decisions that the executive management team has been having over the past few to several months," said Laurie Saxton, media relations director at Sewanee. "Our president just really looked around the room and said, ‘Somebody's got to stop the cycle.' …Sewanee was in a position to do that financially."
Sewanee, located in Sewanee, Tenn., enrolls about 1,500 students in comparison to DePauw's 2,300. Their price tag for the current academic year hit $46,112, while DePauw's increased to $44,085. In light of the 2011-2012 numbers announced by both schools, Sewanee and DePauw trade places in the cost ranks, charging about $41,500 and $46,700, respectively.
"This is an interesting strategy they have," said Brad Kelsheimer, vice president for finance and administration at DePauw. "They have a different business model than we do...Their average aid per student is $7,500 less than ours."
Kelsheimer said he's had the opportunity to review Sewanee's finances and has found some interesting comparisons between the universities.
"Looking at their cost structure, they could use some spread — they would benefit from a larger enrollment," Kelsheimer said. "Their total operating costs are close to $80 million, and that's not a lot less than ours, and we're spreading it over 2,300 students."
He added that DePauw's operating costs are close to $90 million.
Saxton said the university has considered the impact a higher enrollment could have, given their tuition reduction.
"We think that we will probably enroll some number of more students, but not a huge increase, so that will help," she said.
Saxton said they will not lay off staff, nor will they cut any programs and consequently impact the experience students expect to have upon arrival at the university.
Between an endowment they say has "bounced back" after the economic downturn two years ago and completing a successful capital campaign three years ago, Saxton said a tight budget and careful planning will be key to making the new tuition numbers work.
"We can handle it and keep moving forward by increasing giving and, hopefully, not using the endowment," Saxton said. "But it's there if we need it, and it's in good shape."
President Brian Casey said his administration tried to figure out what Sewanee did to make the cut possible, thinking they would have to cut programs or scholarships.
"I'm not willing to do that, either one of them," Casey said. "I wrote that to the board of trustees."
Though reducing program funding seems to be off the table for Sewanee, financial aid is a different story.
"With tuition being lower, we think that we could steal back a little bit on the financial aid, making it more need-based than merit-based," Saxton said. "We're looking at some foundation support, as well as through grants for people who want to be associated with an initiative helping the middle class and getting their kids through college."
The timing of Sewanee's reduction has some correlation to DePauw's plans for the future. Three years prior to the tuition cut, Sewanee wrapped up a development campaign, much like the one DePauw embarks on now. Sewanee constructed new buildings and grew with their short-term goals, raising $205.7 million during a seven-year campaign.
"Maybe they're thinking, ‘We just finished this campaign, we're in the position to try something,'" Kelsheimer said. Whether or not DePauw would consider an action like this after the advancement campaign, Kelsheimer said he wouldn't rule out the possibility.
"We'll know more about what they're trying to do in a couple months," Casey said. "To make a move like that, if it undercuts your ability to support financial aid, it's not a move I want to make."
— Andrew Maddocks contributed to this story.