Tuition discounting, the practice of permitting some students to pay less than full tuition, has risen markedly in profile in recent years, both inside and outside of academe. This increased visibility makes it important that colleges understand tuition discounting in order to facilitate more efficient revenue management and to provide credible information to a public demanding explanations for rising college costs. Confusion permeates tuition discounting in both internal and external arenas. One source of confusion is that college administrators and policy analysts view the subject differently and tend to talk past each other when discussing it. Tuition discounting is also misunderstood by the public, in part because the higher education community does not discuss it with one voice. The purpose of this paper is to contribute to the broader understanding of tuition discounting by providing clear definitions of its terms and an analysis of some of the associated issues. This paper will: review why tuition discounting issues are important; outline the sources of confusion; define the various types of tuition discounts, including related terms such as "gross and net tuition revenue" and "grossing up"; present as historical background the manner in which tuition discounting was administered prior to the recent changes in the fund accounting rules; describe the impact of the new accounting rules, along with some of the pitfalls that mark the new regime; outline the different uses of tuition discounting by the three higher education groups that employ them; and apply the accumulated definitions to an analysis of some of the practical and political problems associated with tuition discounting.
Allan, Ronald Gage
"Taxonomy of Tuition Discounting,"
Journal of Student Financial Aid: Vol. 29
, Article 1.
Available at: http://publications.nasfaa.org/jsfa/vol29/iss2/1