Touting Transparency, Hartwick Lowers Tuition by 60%
Credit: Image courtesy of Hartwick College- Hartwick College will reduce its tuition from roughly $56,000 to $22,000 beginning in 2025.
- Part of a rebranding strategy, the tuition reset aims to add transparency to college financing and save families money.
- A private college, Hartwick hopes to attract more families opting for public universities.
- Hartwick joins a growing number of colleges lowering tuition costs.
Paying for college is a lot like purchasing a car. There’s the sticker price, and there’s what you actually owe.
Few families pay a college’s MSRP. Even wealthy students can get “merit” scholarships to entice them to attend.
Instead, most families pay a discounted price based largely on income and assets, not one’s ability to haggle with pushy salespeople.
That’s the good news — college isn’t as expensive as it initially appears. The bad news is that this “high tuition, high discount” model confuses students and their families and increases overall student loan debt.
To address both concerns, Hartwick College has introduced a new set of initiatives that includes a tuition “reset” that will reduce the sticker price by 60%. Will it work?
Hartwick Becomes the ‘Life Balance College’
In September, Hartwick proudly proclaimed its new identity as “The Life Balance College.”
The initiative rests on four pillars: academic well-being, highlighted by personalized faculty support; physical and emotional wellness, featuring outdoor activities and peer health advisors; and career preparation such as coaching and alumni networking.
Students can earn up to $500 per year in “life balance credits” by participating in certain wellness, career development, and community engagement activities on and around campus.
The fourth, and perhaps most significant, pillar is termed “financial health.” That’s where the tuition reset comes in.
Starting in fall 2025, Hartwick will drop its tuition and fees, currently around $56,000 per academic year, to $22,000. Students will pay an additional $16,000 for room and board.
“The higher education landscape is evolving, and so are we,” Hartwick President James H. Mullen said in the announcement. “While many institutions remain stationary, we are forging ahead with our innovative spirit and agility.”
All students — not just the entering class — will benefit and remain eligible for merit and need-based aid, which, in many cases, will reduce this cost even further.
Bryan Gross, Hartwick’s vice president for enrollment management, who helped spearhead the initiative, told BestColleges the move will provide families with much-needed transparency around college admissions and financing.
“With all the headwinds in higher education, such as declining demographics, a changing consumer mindset, and financial models being called into question, we felt it was really important to present Hartwick in an authentic way that would attract students and families,” Gross said.
But why now?
Gross said last year’s Free Application for Federal Student Aid (FAFSA) fiasco provided a tipping point.
“As we were trying to navigate our families through this and talk to them in a clear way about how they can understand their direct costs and their net costs in light of not having their FAFSA information, we realized even further that families are really not attuned to this,” he said.
“So that really helped us think about this important initiative to be clear and transparent.”
Hartwick claims this reset will “reduce the long-term debt burden on students and their families.” But if the college already discounts tuition according to family income, how will a lower sticker price reduce loan debt?
Gross explained that Hartwick, like many colleges, doesn’t meet the full financial need of its students, instead leaving a gap between the net cost families are expected to pay and what financial aid can cover.
“We’re going to lower that gap,” Gross said, “and we’re going to be able to lower the amount of loans that students need to take out in order to fund their education.”
What’s more, future incremental tuition hikes will be based on a lower cost. Assuming a 4% increase, tuition for 2026 would rise by $880, not $2,240.
Benchmarking Against Public Universities
It’s logical to assume the new $22,000 sticker price represents the net tuition families already pay. But it’s not.
The average net price is about $13,500, not including room and board, Gross pointed out. He said that with need-based and merit aid, the college will continue to maintain that average net cost.
To arrive at the new tuition price point, the college benchmarked against not only fellow private colleges but also public universities. Upstate New York, where Hartwick is located, is awash in State University of New York (SUNY) campuses, offering students plenty of public options that tend to be cheaper, at least in terms of advertised tuition.
Gross said eight of Hartwick’s top 15 competitors are SUNY schools, most notably SUNY Oneonta, located less than five minutes from Hartwick’s campus.
“Almost every family that comes and visits our campus for an open house or a tour is probably also going across the street and looking at SUNY,” Gross said.
Two years ago, Hartwick piloted its “HartLand Promise” program, offering students from the college’s nine surrounding counties a special tuition rate of between $9,000 and $10,000 (students must also live on campus). Designed to make Hartwick more competitive with state universities, the program represented a “test for the reset,” Gross said.
It worked. In those two years, applications, yield, and enrollment all went up.
Most students, of course, are pleased with the tuition reset, Gross said, yet there’s been “pushback” among some who are confused by how this move will affect scholarship aid. College officials are working with students and families to review their individual circumstances and explain how they stand to benefit.
“Every single one of our students will save money over what they would have paid had we not realigned our tuition,” Gross said.
Overcoming the ‘Chivas Regal’ Effect
In marketing, the “Chivas Regal” effect refers to the phenomenon that consumers equate price with quality. If something is expensive, it must be good.
Conversely, a lower-priced commodity must be inferior.
That’s one challenge Hartwick officials considered when rolling out the tuition reset. Would a lower tuition price point suggest lower quality, especially in comparison with other private colleges charging twice as much?
“There will be some families that would rather look at a school with a $70,000 price tag and then receive a $35,000 or $40,000 scholarship,” Gross said. “But we think that adds unnecessary debt to families, and we don’t think that’s a very transparent way of doing business. And it’s frankly unsustainable.”
Donna Shaffner, a principal with EAB, a consulting firm that works with colleges and universities, guided Hartwick through its tuition reset. While acknowledging the potential Chivas Regal effect, she suggested the college’s concerns are more fundamental.
“Hartwick wasn’t in a place of repair,” Shaffner told BestColleges. “Hartwick is in a place of not being known, and it’s about capturing a market that’s farther afield.”
Despite its relative anonymity, Hartwick launched this rebranding and tuition reset from a position of strength. Its enrollment has rebounded from a pandemic-induced slump and has maintained a positive trajectory, Gross noted.
One ongoing concern, though, is its discount rate, the percentage of tuition and fees returned to students in the form of financial aid. At roughly 67%, it’s well above the national average of 51% for private colleges. A high discount rate generally means less net tuition revenue.
Given the smaller margin between what comes in and what goes out, the reset will lower the discount rate to about 30% but will have little effect on net revenue, Shaffner explained, adding that discount rates alone are often an inadequate measure of financial health.
Indeed, a 2022 study of tuition resets found that such policies didn’t affect net tuition revenue but did reduce the net cost for students.
That may be enough to convince more families to consider Hartwick, including relatively affluent families who more often than not wind up sending their kids to SUNY Oneonta instead of the private alternative down the road.
“It’s two working parents,” Shaffner said. “They have a lovely home. They probably have a boat. They go to Disney World. And they have zero disposable income. They’re living to their means, and that’s the population that normally goes to public institutions. And now Hartwick can get into that market.”
Nudging Higher Education in the Right Direction
Hartwick isn’t the first private college to lower its tuition, and it likely won’t be the last. A year ago, Colby-Sawyer College in New Hampshire dropped its tuition from about $46,000 to $17,500.
Since 2012, in fact, more than 70 colleges have employed this tactic to varying degrees.
Gross hopes additional schools will adopt Hartwick’s strategy.
“We think it will be better for the industry if more institutions, particularly private institutions, follow our lead and offer this type of transparency to students and families,” he said.
It’s certainly in the colleges’ best interests. According to a recent study by Ruffalo Noel Levitz, 67% of parents rule out college based on the sticker price alone, failing to understand the nuances of net pricing.
“This will grow the market,” said Shaffner, who implemented a similar policy while at Utica College and has helped other institutions do so, “and it will allow Pell-eligible and needy students to understand the price from the very beginning and not be shied away.
“The family now says, ‘Wow! This is kind of manageable.’ Well, it was always manageable, and you just didn’t realize it.”