Online degree program projected to bring in $3.46 million by 2017-18
USC expects to lose $277,535 getting Palmetto College off the ground during the 2012-2013 academic year, though the program should recoup those funds the following year, according to Chief Financial Officer Ed Walton.
As the program develops, the university will spend an anticipated $1.08 million in startup expenses, advertising and building the online degree program’s infrastructure.
By the 2017-18 academic year, Palmetto College, which plans to let students with at least 60 credit hours finish their four-year degrees online, is projected to bring in $3.46 million.
The projections assume that 300 students taking 22 credits per year will enroll in the first year; that class sizes will grow by between 50 and 100 students each year; and that USC will charge $367 per credit hour.
Provost Michael Amiridis thinks those assumptions are realistic. USC hasn’t yet started advertising the program, which is set to roll out with two degree offerings next year, but it has already received about 200 applications, Amiridis said.
“If we can’t attract that many students, then Palmetto College is a bad idea, and we should go back and say, ‘Fold it,’” he said. “But I expect that we will be able to attract the students.”
Palmetto College’s tuition won’t necessarily hold constant, though.
Its rates will be tied to those at USC’s four-year campuses and is expected to stay about 10 percent lower than tuition at the Columbia campus, according to an email sent to faculty.
The predictions also assume that the project will not receive any state support, though university officials expect that it will.
A proposed budget passed by the South Carolina House of Representatives includes a one-time allocation of $2.2 million and $2.8 million more in recurring funds for the program, though that proposal must first be passed by the state Senate and signed by Gov. Nikki Haley.
At present, Walton’s five-year projections expect Palmetto College to add one additional degree program each year, but if the university receives that $5 million, it could speed the process up.
USC hasn’t worked out the details of how it would use the cash infusion, Walton said, but it does have an idea for where the money would go.
“This funding would help cover the costs of course development and revision for online delivery, additional technological capacity and efforts to recruit, serve and retain students,” the email to faculty members said.
That’s significant, because paying for the costs of developing new programs is one of the factors limiting Palmetto College’s growth, Amiridis said.
The provost’s office paid about $150,000 for a liberal arts program, which will be rolled out on a “pilot scale” this fall, but how much each offering will cost to get running depends on the number of classes it requires, its complexity and its lab requirements, Amiridis said.
How those costs work out will play a role as USC decides which programs to offer in Fall 2013, when it plans to have five options online.
Those five will come in a pool of seven possibilities: two Palmetto Programs degrees — liberal arts and organizational leadership — and five others that have been proposed by USC’s four-year campuses.
So far, Amiridis said, those proposals include criminal justice and conversion nursing from USC Upstate, human services from Beaufort, business from Aiken and “some type of education degree” from Columbia.
The existing availability of those programs within the USC system — in addition to students’ interest and the field’s job prospects — will also play into the decision of what to offer, as the university doesn’t plan to hire new professors to support Palmetto College, Amiridis said.
Instead, he said, it will likely offer grants to existing faculty to teach over the summer or release them from part of their normal teaching load.
“It’s going to be part of their regular teaching duties,” Amiridis said. “If it’s not, then we’ll have to give them some kind of supplement.”
For now, USC is laying the groundwork to get the program in motion — and to restructure parts of its statewide system to accommodate it.
At present, the university is vetting the proposed degree programs and will begin accepting bids from outside contractors with experience in online programs within a month and a half.
It’s also answering questions from faculty about how the program will shake up the USC system, including today’s email to faculty.
Palmetto College will absorb the two-year, regional campuses — Lancaster, Salkehatchie, Sumter and Union — into one structure with equal standing to the four-year campuses, which will be headed by a new chancellor.
USC President Harris Pastides will name a search committee to fill that role within a week, Amiridis said, which will hire for the position within three to five months.
“The critical step at this point in time is to hire the leaders, to bring the new chancellor in,” Amiridis said. “I hope that we can have somebody here in the fall.”