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Cooper Union, one of the country’s last tuition-free higher education institutions, will start charging for some new graduate programs in the fall to help the college deal with a deepening financial deficit and keep its three main undergraduate programs free for students – for now.

In an letter to the campus Tuesday, President Jamshed Bharucha, who took office last year, said the college would start a series of new fee-based programs, including master’s and other professional programs, online programs, continuing education, and interdisciplinary programs, to bring in new revenues.

He promised that the university would remain tuition-free for all current students and students entering in 2013, though he could not promise that the institution would continue to remain tuition-free for future students, even in the existing programs. “Our capacity to sustain our scholarship program will be tied to our success in generating additional revenues from new programs, as well as from philanthropy,” he said.

Leaving the door open to potential undergraduate tuition charges likely won’t sit well with students and alumni. The initial announcement that the college was considering charging tuition was met with resistance, with many students and alumni saying that they would not have attended the institution if it had charged tuition. Students protested the idea of charging tuition (in both traditional and creative ways).

Students were relieved that they’re off the hook for the moment, but worried about where the decision could potentially lead. “It’s a step in the right direction,” Alan Lundgard, a junior at Cooper Union and president of the student council, told The New York Times Local East Village Blog, “but one step in the right direction and a step in the wrong direction don’t really get us anywhere.”

While several students, alumni, and faculty members sat on the revenue task force that crafted the proposed plan, many appear set to say the college did not consult widely enough. A group called “Friends of Cooper Union” planned a summit for Thursday evening to discuss ways the college could balance its budget without charging tuition on any programs.

“We’ve suspected that this is the direction things have been moving in for a while,” Lundgard said. “This will be met with fervent opposition from the community in that there was no consultation at any point with members of the community.”

Since 1902, the college, which has three schools focused on art, architecture, and engineering, has awarded scholarships to all undergraduate students. The college technically has a tuition price – $37,500 a year – but it gives students full scholarships to cover the cost. What makes the tuition-free model even more remarkable is the fact that Cooper Union is regularly ranked as near the top in its disciplines.

Peter Cooper, the college's founder, wanted the institution to be free for working-class students, and dedicated the majority of his wealth and real estate holdings to fund that mission. The college funds most of its operations through returns on its $600 million endowment, which includes rent on the Chrysler building.

Tuition-free colleges and universities are rare these days, and most are work colleges that cover some of their overhead by employing students around campus. Most are small and focused on the liberal arts, so they don’t require the infrastructure that an engineering, architecture, and art institution does. As a result they spend significantly less per student than Cooper Union.

Bharucha announced in November that the college was considering charging tuition to deal with a growing structural deficit, the result of the increasing cost of higher education – rising faculty salaries and benefits and more expensive infrastructure such as information technology and student services – and decreased return on investment. Like that of most colleges, Cooper Union's endowment took a hit in 2009, and the rents have not kept pace with costs.

Bharucha’s announcement in the fall was the first that many faculty members heard about the institution’s structural problems, which had apparently been deepening for several years.

The college has not announced what it will charge for the new programs, or what exactly those programs will be. The university does not have much time to design the programs and seek approval from the State Board of Regents, which must approve all new academic programs.

In a letter to alumni, Peter Cafiero, president of the college’s alumni association and a member of the revenue task force that came up with the plan, wrote that he fully supports the plan announced by Bharucha on Tuesday. “Decisions required to achieve these long term goals will undoubtedly be criticized, either for going too far or not going far enough,” he wrote. “I do believe strongly that this plan is the best hope for preserving what many of us feel is important about The Cooper Union, and even improving it.”

In addition to its plan to charge for the new programs, the university has also greatly stepped up its fund-raising efforts, which have been weak compared to other institutions. Giving is up 32 percent over last year, to a total of $1,568,842, though alumni participation in the college’s annual fund is only about 20 percent.

The college also plans to cut about $4 million from next year’s budget, mostly from the administrative side of the university.

Bharucha said the plan put on the table is currently the best option the college has going forward. “Weighing all the alternatives, I am convinced that some fee-based programs are necessary for Cooper Union’s solvency, and that this framework gives us the most optimistic way forward,” he said. “Because we have a short runway to get these programs going, failing to act now will put the institution in peril.”

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