While the 4.8% ($399) 2012-13 increase in published in-state tuition and fees at public four-year colleges and universities across the nation was lower than that of recent years, the rapid growth in federal aid — which for a few years actually reduced the average net prices students paid — has ended.

With two-thirds of full-time undergraduate students receiving grant aid, the net prices most students pay are lower than the published prices. In 2012-13, full-time undergraduates at public four-year institutions receive an estimated average of $5,750 in grant aid from all sources and federal tax benefits to help them pay the average $8,655 published tuition and fees. The students pay an average net tuition and fee price of just over $2,900. After declining for two years in inflation-adjusted dollars, the net price has risen each year since 2009-10.

In 2011-12, undergraduate students across all sectors of higher education received an average of $13,218 per full-time equivalent (FTE) student in financial aid, including $6,932 in grant aid from all sources, $5,056 in federal loans, and $1,230 in a combination of tax credits and deductions and Federal Work-Study. Federal grant aid for undergraduates nearly doubled from $26 billion (in 2011 dollars) to $52 billion between 2008-09 and 2010-11, but it declined to $49 billion in 2011-12.

These are just some of the findings detailed in the College Board Advocacy & Policy Center's Trends in College Pricing 2012 and Trends in Student Aid 2012 reports that will be released at the College Board's Forum 2012 today.

Key Tuition and Fee Findings

• Average published tuition and fees for in-state students at public four-year colleges and universities increased from $8,256 in 2011-12 to $8,655 in 2012-13. The 4.8% increase in tuition and fees was accompanied by a $325 (3.7%) increase in room and board charges for students living on campus. At $9,205, room and board charges account for more than half of the total charges for these students.
• Average published tuition and fees for out-of-state students at public four-year colleges and universities increased by $883 (4.2%), from $20,823 in 2011-12 to $21,706 in 2012-13. Total charges, including room and board for students living on campus, average $30,911.
• Average published tuition and fees at private nonprofit four-year institutions increased by $1,173 (4.2%), from $27,883 in 2011-12 to $29,056 in 2012-13. Total charges, including room and board for students living on campus, average $39,518.
• Average published in-state tuition and fees at public two-year colleges increased by $172 (5.8%), from $2,959 in 2011-12 to $3,131 in 2012-13.

"Colleges and universities, along with state and federal officials, share the concern of students and families grappling with the rising price of a college education," said Sandy Baum, independent policy analyst for the College Board. "Continued efforts to rein in costs and to provide sufficient public subsidies — both to public colleges and to students with financial need — are vital to the future of our society and our economy."

The average annual increase in average published tuition and fees at private nonprofit four-year colleges and universities over the decade from 2002-03 to 2012-13 was 2.4% beyond inflation — lowerthan in either of the two preceding decades. But the 5.2% average growth rate in published tuition and fees at public four-year institutions was higher than that of either of the two preceding decades.

It is difficult to project future price increases. After a 9.3% real increase in 2009-10, the tuition increase in the public four-year sector has declined in each successive year. Similarly, large increases from 2002-03 through 2004-05 were followed by more moderate growth in prices. The same pattern occurred in the early 1980s and the early 1990s.

A key factor contributing to the rise in tuition at public colleges and universities is diminished state funding. Inflation-adjusted state appropriations per public full-time equivalent (FTE) student fell sharply for a fourth consecutive year in 2011-12. The 10% decline followed declines of 9% in 2008-09, 6% in 2009-10, and 5% in 2010-11. From 2007-08 to 2011-12, total state appropriations fell by 17% after adjusting for inflation, while public FTE enrollment increased by 12%. As a result, state appropriations per public FTE student declined by 26% during this time period.

Key Student Aid Findings

• Total education borrowing, including federal student and parent loans, as well as nonfederal loans, declined by 4% in real terms between 2010-11 and 2011-12 — the first decline in at least 20 years. However, the 2011-12 total of $113.4 billion was 24% higher than five years earlier.
• Over the decade from 2001-02 to 2011-12, the number of federal Stafford Loan borrowers almost doubled, while the average amount borrowed from subsidized and unsubsidized Stafford Loans combined increased by 8%, from $7,627 (in 2011 dollars) to $8,230.
• During the 2011-12 academic year, $236.7 billion in financial aid was distributed to undergraduate and graduate students in the form of grants from all sources, Federal Work-Study (FWS), federal loans, and federal tax credits and deductions. In addition, students borrowed about $8.1 billion from private, state and institutional sources to help finance their education.
• The number of students receiving Pell Grants — the central federal grant program providing funding for low- and moderate-income students — increased from 2.7 million in 1981-82 and 3.8 million in 1991-92 to 4.3 million in 2001-02 and to 9.4 million (37% of all undergraduates) in 2011-12.