What is a Fair Tuition Fee?
by John Vegt, SCSBC Director of Finance ◊
There are currently 32 SCSBC school societies that operate some 47 campuses across the province. Given that each of these societies is fiercely independent, it is no surprise there are also 32 different tuition models currently in existence.
What is fair tuition from the schools’ and the parents’ view-point? What principles should guide schools in setting tuition fees? Here are some best practices for schools to consider when establishing tuition fees.
- Set tuition levels that equate total tuition and fees from parents to the total amount received from government grants. Each revenue source should finance half of the school’s annual operating expenses. For the 2008/9 school year, on average, SCSBC schools fees represented only 82% of all government grants.
- Use the SCSBC Budget Template software, to easily calculate the financial effect a change in the tuition structure can have on your operational budget surplus or deficit.
- Provide discounts to parents with more than one child. The average additional cost for a second child in a family is around $1,000 to $1,500, a third child $500 and additional children nominal amounts. Consider setting a maximum family rate.
- Offer a discount if a sibling attends another SCSBC school; these discounts usually range from 20% to 30%.
- Set different tuition fees for kindergarten, elementary, middle and high school and match the cost of each level with tuition.
- Be careful about offering discounted tuition “seat sales” as it may be difficult in subsequent years to charge full tuition.
- Consider a small tuition discount of no more than 1% or 2% for tuition fees paid in advance in September. If the school depends on a line of credit during certain periods of the school year this may be advantageous. If not, then the savings to the school is likely less than 1%.
- Provide for tuition assistance to those who really need it. How- ever, be diligent in obtaining objective financial information from applicant annually. A tuition assistance policy should be developed to ensure consistency and fairness.
- Consider charging a one time facility fee for infrastructure costs.
- Consider setting course rates for those students who do not take a full course load at your school.
- Determine, on a cost recovery basis, separate fees for extra services such as busing, graduation, supplies, application and registration, extracurricular trips, mission trips and other services.
- Decide how to finance the additional expense of running a Special Education program. On average, the provincial government grants for Special Education were 18% less than the actual cost of providing these services for special needs students. In total, the shortfall between Special Education grants received and actual expenditures to run these programs in each of our schools amounted to $850,000 last year.
- Ensure that teachers and support staff are compensated fairly; they generally earn less than public school teachers and in some cases significantly less. The annual SCSBC Compensation Report does significant research into what is a fair salary and benefits package for employees.
- Parents on average only pay 30% of operating cost on an after tax basis; the government grant, other income and personal tax recovery pays the remainder.
- Inform parents that on average they pay only $3,274 per student on tuition and recover $1,112 of this for a net average cost to parents of $2,162 per student. The average cost of education per student is $7,904.
- Consider that Ontario and Washington State receive no government funding and charge tuition fees approximately double the average in our schools.
- Market value for amount of tuition paid. Day care costs far exceed Christian school tuition fees. The type of education parent chooses for their child(ren) is ultimately their choice. However the value that is placed on that choice will make a significant difference to your children.
In order for a Christian school to provide quality education, fair compensation for administrators, teachers and support staff, the right technological tools and a good physical infrastructure requires adequate funding. Presently the revenues needed to operate many of our Christian schools fall short and generally it is tuition fees that have not kept up with the actual cost of education. Several schools may need to reevaluate their current tuition fee structure in order to do some catching up.
If all of our SCSBC schools would equate tuition fees charged to government grants received, tuition fees for all those schools would need to increase in aggregate by $6.8 million or about $680 per student. Currently most of this shortfall among our schools has been financed by fundraising, donations, and other sources of revenue or it has simply been added to the school’s overall debt. Best practice would suggest that these additional sources of revenue ought to be used to finance capital infrastructure and debt repayment.
Paying tuition is more than simply a cost, it is an investment in our children’s lives! Christian education is worth the price! Therefore, let’s design a fair tuition model for the tremendous value received!