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New Student Facilities Fee to Cover Fairbanks Campus Power Plant, Other Upgrades

Fairbanks, AK - In June, Governor Sean Parnell signed Senate Bill 218 into law, paving the way for a $245 million dollar renovation and upgrade to the power plant at the University of Alaska, Fairbanks.  But the project is funded in part by revenue bonds that have to be paid back to the state.

According to a memorandum sent last week by University of Alaska System President Pat Gamble, the Board of Regents plans to implement a student fee to cover costs associated with the project.

When the legislature approved funding for this year’s state budget, the money allocated for a new heat and power plant at the University of Alaska Fairbanks came with this language:
"It is the intent of the legislature that the University of Alaska implement a utility surcharge or increase tuition in an amount not to exceed annual revenue of $2,000,000.”  

With the project currently under construction, the University is now on the hook to pay the state back.
That’s why UA President Pat Gamble’s endorsed a proposal to implement a new system-wide student fee. Kate Ripley is the UA system spokeswoman. “There is never enough money that we really need to keep pace with what we need to do so this is seen as a way to have an additional revenue stream,” says Ripley.

Beginning Spring semester, 2015, graduate and undergraduate students and those enrolled in distance education courses will pay two dollars per credit.  The fee will increase by two more dollars for the following two semesters. That means by January 2016, full-time students could see an increase of $90 dollars in fees added to their total bill. “We never like instituting new fees," says Kate Ripley.  "It’s something that we have to look at very seriously and that we do reluctantly obviously because there is a financial impact to students.”

According to the Financial Aid Office at the University of Alaska, Fairbanks, students already pay an average of $640 per year in fees for things like student government, athletics, technology, and transportation among others. An annual survey by the College Board Advocacy and Policy Center shows University of Alaska students pay the second lowest tuition and fees in the nation behind Wyoming.

Kate Ripley says the money collected through the new facilities fee will stay at the campus where it is collected. “One of the things we heard from students is they didn’t think a tuition increase was fair," she explains, "because in that kind of scenario, a student at the university of Alaska southeast in Ketchikan for example, would be paying higher tuition for a heat and power plant in Fairbanks.”

In Fairbanks, the money will go to help pay for the new heat and power plant. At other campuses, the money will be used for upgrades to classrooms, laboratories and residence halls. According to the President’s memo, the fees could bring in more than 3.6 million dollars in revenue over the course of three semesters. There is no sunset date and it’s unclear if the fee will continue to increase beyond Fall, 2016.