University Tuition Rises Amid Financial Uncertainty
As financial instability looms, both the University of Michigan and Michigan State University are set to increase tuition fees. These hikes are primarily driven by unpredictable funding prospects from state and federal sources.
According to budget outlines provided by the institutions, the rising costs are influenced by several factors. These include reduced federal funding and a dip in international student numbers due to federal policies.
During a board meeting where the tuition increase was approved, MSU Trustee Mike Balow remarked, “No increase [to tuition] is ever taken lightly, but in light of everything going on, it seems that we struck the balance here.”
Additional financial pressures such as inflation, tariffs, and escalating employee health insurance costs were highlighted by Trustee Sandy Pierce.
Tuition Adjustments
Here are the approved tuition increases for each university:
University of Michigan
- 3.4% increase for in-state undergraduate students (approximately $610 annually)
- 4.9% increase for out-of-state undergraduate students (approximately $3,016 annually)
- 4.9% increase for most graduate students (costs vary by program)
- No increase for students receiving need-based aid
Michigan State University
- 4.5% across-the-board increase (approximately $798 per year)
- This figure could be revised if state legislation adjusts the cap on tuition increases.
State Funding Challenges
State funding remains a significant concern. A recent proposal passed by the state House suggests cutting $224 million from U-M and $56.6 million from MSU. These funds would be redistributed to the state’s 13 other public universities.
The universities based their budgets on different assumptions. U-M anticipated state funding to remain consistent with 2025 levels, while MSU used the less severe state Senate budget as a reference.
State contributions constitute about 12% of U-M’s general fund, while MSU relies on state funding, student tuition, and fees for nearly half of its operational budget, as stated in their budget proposal.
MSU emphasized the importance of state funding, stating, “MSU educates more Michigan residents than any university in the state and prepares them to lead in every sector of our economy.”
Chris Kolb, vice president of government relations at U-M, expressed disappointment over the proposed budget cuts, labeling them as significantly detrimental to the university’s support.
Controversial Budget Provisions
Representative Ann Bollin (R-Brighton), chair of the House Appropriations Committee, criticized the universities for prioritizing diversity, equity, and inclusion (DEI) programs over local students. A clause in the House budget plan aims to retract state funds used for DEI initiatives.
Data from MSU show that 72% of its students were Michigan residents in Spring 2025, while U-M reported 52% of its undergraduates in fall 2024 were from Michigan.
The budget proposal is now awaiting deliberation in the state Senate.
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