In an unusual challenge to the rising cost of higher education, seven University System of Maryland students sued yesterday to block a midyear tuition increase, alleging that it represents a violation of the contract between students and colleges.
The class action lawsuit filed in Baltimore Circuit Court argues that students enrolled for the school year on the understanding they would be charged the fixed tuition rates that their universities had posted for both the fall and spring semester.
University officials broke that agreement, the students argue, by deciding last month to raise this semester's rate by as much as $557 after some spring classes had started and after many spring tuition bills had been mailed.
"The students and universities have a contract, and the universities can't change it midway through the year," said Andrew D. Freeman, one of the attorneys representing the students. "It would be one thing to increase tuition for next year. But to say, `Welcome back to school, write us a check' is not fair, and we don't think it's legal."
The Board of Regents passed the midyear increase Jan. 23 for all of the system's institutions except Coppin State College and the University of Maryland, University College after Gov. Robert L. Ehrlich Jr. cut $36 million from this year's system budget. Students were notified of a possible increase two weeks earlier in a Jan. 8 letter from system Chancellor William E. Kirwan.
The increase resulted in additional spring semester payments of up to $115 for in-state undergraduates, $333 for out-of-state undergraduates, and $557 for some professional school students. Combined with an earlier 5 percent increase for this year's tuition, the surcharge meant that students this spring are paying 10.8 percent more than they did a year ago.
Attorneys for the university system scrambled yesterday to respond to the suit, which was brought by students at the University of Baltimore and University of Maryland, Baltimore.
"We're struggling to react and certify the factual statements [in the suit], but we're prepared to defend the regents' action," said Assistant Attorney General John Anderson. "We don't think it's a breach of any legally cognizable contract. The university system was reluctant to do this but obviously had no choice."
The lawsuit could throw into further disarray the finances of the 11-campus university system. Officials are counting on $12.9 million from the midyear increase to help them respond to a total of $67 million in cuts to this year's budget. The system is left with about $800 million in state funding.
"This is a great concern," regent Joseph D. Tydings, a former U.S. senator, said of the lawsuit. "This screws everything up and makes it very difficult. We were trying to balance everything, without laying off too many people."
If successful, the lawsuit could provide some precedent for student challenges of midyear tuition increases elsewhere. Several states have passed such increases this year without being sued.
Freeman said the only precedents he could find were a 1904 case involving the Baltimore University law school and a 1992 case involving the University System of New Hampshire.
In the 1992 case, New Hampshire's Supreme Court ruled that a midyear tuition increase was permissible because universities had alerted most students two months in advance - earlier than Kirwan's two weeks' notice. But the court ruled that some students who hadn't been notified that far in advance didn't need to pay the higher rate.
"Students must be advised of any impending surcharge in order to be able to make an informed decision as to whether they can afford the potential increase or whether they prefer not to enroll at the institution for that semester," the court said.
A hearing is scheduled for Tuesday on the Maryland students' request for a temporary injunction to block the surcharges, which students have several weeks to pay. If the injunction is not granted and the court later decides to overturn the increase, the students are asking the universities to refund any surcharges that have already been paid.
The lawsuit alleges that the midyear increase also violates the Consumer Protection Act, saying students chose their schools based partly on their cost. Changing previously announced tuition rates amounts to false advertising, the students argue.
In passing the increase last month, the regents said it was needed because the system couldn't find $13 million more in savings in its roughly $2 billion budget without resorting to heavy layoffs or furloughs. Regents warned that an additional increase and layoffs were likely next year when, under Ehrlich's proposed budget, the system is to get the same amount of state funding as this year.
Brandon DeFrehn, president of the University of Maryland, College Park student government association, said yesterday that while he sympathizes with the argument made in the lawsuit, the more important issue is getting more state funding for the system.
"There were a lot of students against the cuts and having to pay more money, but I also think we should be concentrating our efforts toward the legislature," DeFrehn said.
Freeman, the students' attorney, said he understands the budget pressure the regents face, but that does not excuse the midyear increase. Some students who have work-study jobs are having part of their pay withheld to cover the surcharge, he said. Others on financial aid were assessed the charge after they had received their loans for the spring semester, leaving them unable to borrow for the higher amount.
And others have seen the cost of the surcharge deducted from the loan money that was supposed to go toward their living expenses, he said.
"The state imposed huge cuts on the universities, and I don't think the system should have to bear all the cost of the budget deficit," Freeman said. "But I don't think they can pass those costs on to the backs of students who are scraping by."