The Davis Center on the University of Vermont campus in Burlington on September 20, 2023. File photo by Glenn Russell/VTDiggerThe University of Vermont on Friday approved tuition increases for both in-state and out-of-state students for the 2025-2026 academic year.Board trustees and university officials voted Friday to increase out-of-state tuition by 4.5% to $44,646, and in-state tuition by 2% to $16,606. It marks the first time the university has raised in-state tuition since 2019. (The total cost for students living on-campus is roughly $20,500 higher, factoring in fees and other expenses.) University officials said overall health care costs are driving the tuition increase. Health care expenses are expected to increase by 17% over the next year, according to budget documents. Those and other rising expenses are adding greater pressure to the university’s $931 million operating budget. The school is filling a $10 million budget gap in the current fiscal year with excess reserve funds, Donald McCree, a board of trustees member, said at the meeting. “They’re not operating funds, and we can’t depend on those on a continuous basis,” he said.Patricia Prelock, who stepped in as the university’s interim president just weeks ago, said during the meeting that she supports the tuition increases.“Although it pains me, because when my team first brought me four-and-a-half, I said, ‘It’s a non starter. I just can’t go there,’” she said. “But, at the same time, I have to be a fiscally responsible leader.”Richard Cate, the university’s interim vice president for finance and administration, and Patricia Prelock, interim president of the university, at a budget, finance and investment committee meeting Friday, Oct. 25. Photo by Corey McDonald/VTDiggerThe university also approved an additional $4 million in revenue by adding $1,000 in fees for students enrolled in the College of Nursing and Health Sciences, Grossman School of Business, and College of Engineering and Mathematical Sciences.The rising cost of health care in Vermont is affecting institutions and businesses throughout the state. For UVM, school officials say, it threatens the university’s goals of remaining affordable and competing with peer institutions in the country.The school in recent years has worked to bolster its research capabilities, as well as its graduate and Ph.D. offerings. It will soon attain a top-tier research designation, which it hopes will continue to drive this growth.But the university’s health care costs have grown dramatically — by 23.3% in 2023, and 18.7% last fiscal year, according to budget documents presented at the meeting.“That’s unsustainable long-term,” UVM Trustee Ed Pagano said during the meeting. “People have to realize something’s going to have to change.”Trustees at the meeting noted the tuition increases will generate only a fraction of the funds necessary to offset the rising expenses they’re seeing. And the rising costs extend beyond health care.READ MORE While McCree called the university’s health care expenses the most “painful,” he noted that other costs are pressuring the university’s budget, including personnel costs, as well as oil, gas and utility bills.University officials at the Friday meeting noted that while the rising inflationary costs present a challenge, they believe it is something the university can weather.It will require “some really tough lifting by the administration in terms of structural changes that could happen,” McCree said, as well as an overview of which programs the university can afford to continue. “That’s going to take a while to kind of work through,” he said.“This is a problem, but it’s not a crisis,” McCree added. Read the story on VTDigger here: UVM increases tuition as rising health care costs drive $10M budget gap.