Updated 10:14 p.m. Thursday.
CHICAGO — Families grateful for the relatively small tuition increase expected at the University of Illinois next fall may want to hold on to their wallets.
The 1.7 percent increase approved Thursday — the lowest in 18 years — is pegged to inflation, a policy the board of trustees set in 2011. But that could change in future years if state funding continues to slide, officials said.
"We've made a commitment to raise our costs" no higher than inflation, board Chairman Chris Kennedy said Thursday. "We're meeting that goal. If the state cuts our funding, we're going to have to look at that again."
Tuition for freshmen entering the Urbana campus will be $11,834 a year in 2013-14, $198 more than it was for those who started last fall. Tuition rates last year rose about 4.8 percent. Per state law, tuition is guaranteed to stay the same for four years for incoming students.
Some programs, such as engineering or fine and applied arts, charge higher tuition. The costs for those programs also will edge higher by about $198 a year. For example, engineering students will pay $16,754, up from roughly $16,556.
In dollars, the increase is the smallest since the 2000-2001 academic year in Urbana.
"Percentage-wise, it's the lowest increase since I was 3 years old," said John Tienken, student trustee from the UI Springfield, who commended UI leaders for making access a priority.
Meeting in Chicago, trustees approved the new tuition rates — along with increases in fees and room and board costs — less than two hours after the rates were made public.
Two years ago, trustees approved a resolution that called for tuition increases to include a comparison with a price index and account for changes in state support.
Christophe Pierre, the UI's vice president for academic affairs, said the 1.7 percent matches inflation, based on the Consumer Price Index and Higher Education Price Index. The modest increase protects student access and affordability and will help the university enhance quality, he said, while recognizing the uncertainty with state funding.
"We've had reductions in state support in the past years, and we don't know what our appropriations will be in the coming year," Pierre said.
The UI's state appropriation was down about 6 percent this fiscal year, from $709.7 million last year to approximately $667 million. However, the state is expected to kick in more money for pension and health benefits for UI employees. Payments-on-behalf, state money given to the UI for benefits, jumped $383 million, or nearly 29 percent, from $793 million in fiscal year 2012 to $1.02 billion this year.
The governor's Office of Management and Budget has asked the university to prepare for a funding cut of 4.6 percent, or about $30 million, for fiscal 2014, which begins July 1, said Walter Knorr, UI vice president and comptroller.
That's an annual exercise, Knorr said, and it's hard to predict where the numbers will fall when the governor delivers his annual budget address in March. Everything hinges on a resolution to the state's pension crisis, which could require the UI to kick in money for employee pension costs, he said.
The state also owes the UI $502 billion in unpaid bills, the largest backlog to date, he said.
Kennedy said setting rates in January gives parents more time to plan for college costs, but it opens the UI to risk because of funding uncertainties.
"It's better that we take the risk than individual families," Kennedy said.
Administrators said they have prepared for inflation-level increases in tuition, which brings in more than $1 billion annually for the university.
President Bob Easter said the university has undertaken numerous cost-control efforts in recent years that saved more than $60 million. Price increases have also moderated, he said.
"The campuses have worked very, very hard to keep costs down," Pierre said.
Adding up tuition, fees and room and board, it will cost most Urbana students $24,729 a year for those beginning this fall. That's a $519 increase over the current year.
Student fees for the Urbana campus will rise about 1 percent or $30 a year to a total of $2,916 for 2013-2014. The fees pay for a variety of services and units, such as campus recreation, library and information technology, health services, deferred maintenance on campus buildings and more.
Standard room and board rates for the Urbana campus (a double room and 14 meals per week) will increase about 3 percent to just below $10,000 a year. The rates are $9,979 for 2013-2014, up $291.
The board's newest member, former federal prosecutor Patrick Fitzgerald, was welcomed at the start of the meeting but was not on hand for votes on tuition and other agenda items. He had to attend a previously scheduled court hearing, officials said.
— Trustees re-elected Kennedy to another term as board chairman. He was first named chairman after being appointed to the board in September 2009 following the Category I admissions scandal. He was elected to his first full term the following January and has been re-elected each year since.
Trustee James Montgomery nominated Kennedy, saying he has "provided the university with thoughtful and strong guidance" during a year of difficult challenges. The motion was seconded by Trustee Edward McMillan.
Trustee Pamela Strobel said later board members would consider other candidates as chairman "if we felt that was a necessity" but praised Kennedy's leadership. McMillan and Strobel were re-elected to serve with Kennedy on the board's executive committee.
— The board approved a $4.6 million contract with LCM Architects of Chicago to complete design work and oversee construction on a $70 million renovation of the Natural History Building.
The project had been put on hold because a state procurement board raised conflict-of-interest questions about the previous $4.3 million contract with BLDD Architects of Champaign, and the work was rebid. The completion date is now projected to be July 2016, a year later than planned.
"I'm delighted that we're at last back on track," Easter said Thursday. "It's unfortunate we had to go through this."