Differential Tuition

To strengthen the quality and competitiveness of its educational programs, in the fall of 2005 the university proposed a tuition surcharge for junior- and senior-level engineering students. The surcharge, now referred to as differential tuition, was approved by the Board of Regents for both Iowa State University and the University of Iowa in December 2005.

Question. What is the difference between the tuition surcharge and differential tuition?

Answer. Both are the same thing. The word “surcharge” was used during the proposal phase. The wording in the Board of Regents approval document referred to “differential tuition,” since the additional increment for upper-level tuition would be included in, not separate from, the tuition assessment.

Question. Why is differential tuition needed?

Answer. The mission of the college is to provide a quality education to its students, and financial resources are the means to that end.

The cost of educating engineering students is greater than the cost of educating most other students due to highly laboratory-intensive courses, smaller section sizes, and the need to provide competitive compensation for world-class faculty. As the state’s share of the cost of education decreases and students pay for a larger share, we are now in the situation where tuition from students in programs with lower instructional costs effectively subsidizes the higher cost of educating future engineers.

Question. Why should engineering students pay more?

Answer. In addition to being more expensive to educate, graduates of the engineering college earn substantially more than graduates of other academic programs at Iowa State.

Starting salaries for Iowa State engineers range from $46,000 to $56,000— $2,000 to $5,000 above the national average for all engineering graduates, and several thousand more than other Iowa State graduates. This represents a lifetime earning potential of almost $1.1 million more than non-engineers. In addition, engineering students who participate in internships and co-ops earn substantially more than non-engineering students. The differences between engineers' and other graduates' starting salaries, projected lifetime earnings, and internship/co-op earnings far exceed any difference in additional cost due to the differential tuition.

Question. How will engineering students benefit from differential tuition?

Answer. Differential tuition revenue will be used to hire more faculty and equip state-of-the-art labs, both of which will improve the quality of instruction engineering students receive. In addition, differential tuition will provide additional student financial aid and teaching assistants.

Because of its intense focus on applications and hands-on learning experiences, engineering requires more direct student-professor interaction than many other disciplines. Differential tuition will provide resources to hire more faculty members and so improve the quality of undergraduate engineering education by lowering the current student/faculty ratio in the college.

Question. How much is the difference between the base tuition and differential tuition?

Answer. The total investment represents only three weeks’ starting salary for the average engineering graduate.

Differential tuition will be phased in over a three- to five-year period. Junior- and senior-level students will pay an additional $250 per semester beginning summer 2006. Every year thereafter, differential tuition will increase by $250 per semester until reaching $1,750/year. When fully implemented, differential tuition will yield about $4.3 million a year for the College of Engineering to improve the quality of undergraduate instruction.