The Board of Trustees on Nov. 14 approved tuition increases of about 5.6 percent a year for the 2008 and 2009 fiscal years.
They said UConn remains excellent value, given the reasonable price and the high quality educational experience.
"The charts say that demand for our product is increasing and has been for a decade," said Peter Drotch, chair of the board's finance committee.
"We have no marginal capacity to take more students, our physical plant is at the top of the charts, we're at the top of the rankings in New England, and yet where we rank in tuition [all but one of the New England public universities are more expensive than UConn] . we should be a premium-priced organization.
"The fact is that we're charging Filene's Basement prices for a Neiman Marcus product," Drotch added.
The approved increase is nearly a full percent less than average tuition increases being imposed this year at universities across the nation.
The increase will allow the University to fill faculty vacancies and keep up with inflation.
It will not, however, allow officials to begin implementing a plan to hire 175 new faculty during the next five years, a plan intended to help lower UConn's faculty/
student ratio and enable more students to earn their degree in four years.
Currently, according to a presentation by Provost Peter J. Nicholls, the four-year graduation rate is 56 percent, a number that has improved each of the last five years.
The six-year rate also has improved continuously, said Nicholls, increasing to 74 percent for the class that entered UConn in 1999.
The six-year rate ranks UConn seventh among the top 50 national public universities, according to U.S. News & World Report.
On average, UConn students take 4.3 years to graduate, compared to 4.6 years for students nationwide.
Retention rates also continue to improve, with 93 percent - including 91 percent of minority freshmen - returning in 2006 for their sophomore year, Nicholls said.
Trustees said they recognize the need for new faculty. A number of trustees, on both the finance committee and the full board, said they would consider even higher tuition increases if that would allow the University to begin implementing the plan - first broached three years ago - to hire 175 new faculty.
The plan called originally called for 150 new faculty over a five-year period, in order to continue offering students a top quality education and to lower the student/faculty ratio.
The University requested, but did not receive, funding for the plan in the last state biennial budget. The updated plan requests funding for the upcoming biennium.
Because the Office of Policy and management - the State budget office - has indicated it will not endorse the plan this year, trustees asked President Philip Austin for options to enable the University to implement the plan for additional faculty.
The Provost also discussed plans for the Eminent Faculty Program.
This program, enacted by the General Assembly, will receive $2 million in state funds, to be matched by private donations, to create economic development-related programs intended to draw top scientists and faculty to Storrs with their research teams.
Nicholls said four areas of focus have been identified: fuel cells, nanotechnology, cancer chemoprevention and control, and functional foods.
"Functional foods" are natural and processed foods containing bioactive compounds that promote health beyond their nutritional value. It has not been decided which programs would be funded first.
Each of the four areas, said Nicholls, has potential for commercialization, potential to attract matching funding from industry, and is an area of strength at UConn, and all four respond to legislatively designated areas of need.
The board also approved increases in room and board charges, the general university fee, and several smaller fees.
In seeking the tuition increase, officials cited enrollment increases, inflationary pressures - primarily energy costs - and salary increases as the key cost drivers.
They also discussed the need to increase financial aid for students, which during the past few years has increasingly fallen on the University, as federal and state government support has failed to keep pace with need.
Eighteen percent of UConn tuition revenue is dedicated to scholarships and grants for students in need, and another 7 percent to merit-based scholarships.
"In the late 1990s, financial aid went from being considered a public good to a private good," said Dolan Evanovich vice provost for enrollment management.
"We've had to pick up the slack, and we have always committed more to need-based financial aid than the state requires. No student who meets the qualifications for admission to UConn will be denied because of financial need."