On Friday morning, the Princeton University Policy Research Institute for the Region co-sponsored a forum on state-supported higher education with the New Jersey Association of State Colleges and Universities. I attended, along with one other Princeton faculty colleague (though others may have escaped my notice), but most of the audience was composed of officials of New Jersey’s state colleges.
The topic was “How to Fix a Broken System: Funding Public Higher Education and Making it More Productive.” The speakers and panelists were well chosen and quite helpful. They included Rich Novak (Association of Governing Boards), John Cavanaugh (chancellor, Pennsylvania State system), Dennis Jones (president, National Center for Higher Education Management Systems), David Carter (chancellor, Connecticut State University system), Jane Wellman (Delta Project on Postsecondary Costs, Productivity and Accountability), and the presidents or chancellors of three of New Jersey’s best state colleges.
The focus was on the plight of the public four-year colleges of New Jersey, although the speakers made clear the extent to which our state problems mirrored those of most other states.
The picture that was drawn for us Friday was not pretty, and it is not likely that we will see a prettier picture for many years. Everyone agreed that the next few years will be worse than the past couple of years–the federal stimulus money will be spent, state budget deficits will continue to grow, the easiest savings from cost-cutting will have already been taken.
The larger problem is one that preceded the Great Recession–declining state expenditures for public higher education. Experts do not agree on the precise numbers, but over the past generation we have moved from an environment in which states paid for 70 percent of cost and students paid 30 percent, to a situation in which those numbers have exactly reversed. Increasingly, tuition accounts for the lion’s share of institutional budgets, with state appropriations playing a minority role.
This has had many profound impacts, among them the creation of the need for greatly enhanced financial aid and the dramatic expansion of out-of-state enrollment (because out-of-state student tuition is much closer to the cost of their education). State institutions have long served as the road to upward mobility through higher education for less affluent families. The crucial impact, then, will be to limit college access for those who have been most dependent upon public education.
The sense I got Friday was that higher-education professionals do not expect the ”good old days” to return. Their question was what future financing system could replace the predominantly state line-item system.
This is a genuinely tough question. It is quite clear that tuition is probably already close to maxing out its potential, unless we are to move to a more or less universally privatized system of higher education.
Much of the conversation Friday focused on cost-cutting, but there seemed to be agreement that although there were still savings to be had through more efficient institutional administration, the low-hanging fruit has been already been picked. The same is true of across-the-board budget cutting–the “easy” cuts have been made. Which leaves two questions: Can our public institutions somehow be restructured to accomplish as much without greater financial resources? Can productivity be increased sufficiently to produce as much with fewer (human and financial) resources?
As to the first question, I thought several of the speakers were implicitly advocating restructuring, but there were few concrete proposals. Perhaps this was for the very good reason that restructuring needs to be institution-specific. Yet, if we are to restructure, we need general principles to guide us.
As to the second, I was frustrated by the apparent consensus that public education needs to be more productive, because there was no discussion of the definition of productivity. I think many in the audience had completion of degree (finishing the B.A. degree within six years) in mind as the measure, although many other metrics might be substituted.
There was almost no attention to faculty research as a function of public institutions. To be sure, most of the colleges represented are not doctorate-producing institutions, but their faculty members not only do research, but are expected to do research, especially given that the rhetoric of the colleges is about making a positive economic impact on the state.
But even when instruction was (implicitly) assumed to be the measure of productivity, there was no discussion of measurable learning outcomes. I was also concerned by the focus on the combination of restructuring and productivity, because using those concepts crudely is likely to produce institutional policies favoring the most immediately economic beneficial strategies–bad news for the arts, humanities, and liberal education. When I made that point publicly, I was assured that everyone was aware of that danger. We’ll see. But it was a very thoughtful discussion, and I learned a lot from it.
10 Responses to Can We Afford Our State Colleges?
jffoster - April 4, 2010 at 8:29 am
We’re probably going to have and I think ought have to afford some state collages and a few state universities per state but not as many as we have. Some of those state regional “universities” ought be redowngraded to the state colleges they used to be and some ought be closed. Ohio certainly has too many — 13 state “universities” for a state that isn’t all that large in size. There’s a cluster of em up in the NE a couple of which are only 14 miles apart. Central State should never have been reopened after the 1974 tornado did some urban renewal on it. Arkansas has too many “universities”, Louisiana probably has too many, and even California might have too many, although it is a big state in both population and size. Some states on the other hand are probably about right — Arizona for instance with only three, fairly far apart in a big state. But I recommend also Richard Vedder’s “Going Broke by Degrees: Why College Costs Too Much”. He suggests, among other things, that the percentage of state funding going to instructional and direct instructional support activity has not decreased all that much and in some cases not at all. What rather has happened is that state colleges > “universities” and real state universities have tended to greatly expand the activities and services they engage in and render, greatly expanding the overall budgets. His study precedes the Great Recession so it may no longer completely hold accurate but it’s still worth thinking about. States and their 4 year (+) institutions are also going to have to be more judicious in what kinds of research and scholarship they subsidize, either directly or with reduced teaching loads for faculty. One doesn’t want to cut basic research and go strictly short-term applied, not even in the “STEM” fields — that would be shortsighted indeed and comparable to eating our seed corn. But there is a limit to how much research and scholarship we can support directly or with subsidization and it’s not obvious why the state should reduce teaching loads in, for instance, literature and language departments to generate yet another book on Chaucer or Flaubert or Goethe. And turning the regular faculty in some of those departments into more teaching would halp ameliorate the “adjunct problem”.
stinkcat - April 4, 2010 at 12:14 pm
I think part of the problem is that too many of our state universities have moved away from their core function: to provide a low cost education for its residents.When you see some of the wasted space in some of the buildings that have been built recently, or the fact that teaching loads have decreased across the board, because smaller state schools are attempting to be like R1s, it is not surprising that state schools have become overbloated.
drkimlong - April 5, 2010 at 7:44 am
Teaching loads reduced across the board? Not seeing that. . . .Wasted space? Also not seeing that. . . .
intered - April 5, 2010 at 10:53 am
Thanks Stan.While we have written on this extensively (e.g., http://www.intered.com/higheredbriefing/2010/1/26/an-alternative-to-begging-how-our-state-universities-can-do.html ) it is difficult to understand how state universities can overlook the dollars in their search pennies. Separately, some of your observations deserve responses.1. While direct state funding has generally declined and tuition accounts for a correspondingly larger portion of the total cost of educating a student, per student taxpayer support at public institutions is still in the area of $7-9K per student per annual FTE for the typical state university. The 70/30 reference was never correct because such analyses are based on the tip of the iceberg (i.e., direct funding) and ignore the larger portion of taxpayer support that derives from indirect funding and forgone taxation opportunities. 2. Even with the increases, state university tuition is still low ($7K average for publics, $26K for the average independent).3. While you do not address this issue, taxpayer support at independent colleges is not insubstantial ($6K typical). Taxpayer support at elite independent colleges is considerably greater, often $20K, $30K or more per student per year. (Think: hidden forgone taxation opportunities on endowments, properties, grants, income from government contracts, etc.) While this hidden support has declined recently because the recession has shrunk endowments, it is still high and there is no reason to think it will not return to per-recession levels.4. Productivity (cost per credits and degrees produced to defined standards) has declined at state institutions but it is higher than productivity for independent colleges and substantially higher than productivity at elite private colleges where one sees a steep inverse relationship between faculty compensation and credits produced.5. It is true that public colleges do not measure learning outcomes. Neither does anyone else. U.S. universities resist this kind of accountability in every way they can think of. Since 1985, when the modern assessment movement gained traction, higher education can only be said to have been temporizing, getting ready to get ready through endless committees that go nowhere. Most institutions continue to invoke apodictic notions of quality and refuse to define quality in modern terms (suitability to purpose; quality for whom and for what purpose) or to address the issue of value added, where career schools and community colleges will generally lead. At this time, there is virtually no institution-wide assessment system in place that would pass muster in a 501 measurement science course.6. Yes, public institutions need restructuring to make them more accountable and productive. Our independent colleges and universities need the same kind of restructuring and the agenda is rightfully one of public interest. The common perception that taxpayers do not support our private institutions is false.———————-Robert W TuckerPresidentInterEd, Inc.www.InterEd.com
kevino1685 - April 5, 2010 at 1:00 pm
Nature abhors a vacuum. If the state colleges are not meeting the mission of providing cost-effective education (whether from their own efficiencies or from lack of state funding), then community colleges or other alternatives will see their enrollments grow. (From stories I have read, this is already happening).There are a number of posts above with which I am in raging agreement. While an institution of higher education cannot be run like a business, it can adopt business-like practices along the road to delivering its mission. As an alumnus of a major state university I have participated in numerous alumni advisory roles (multiple departments and multiple colleges) and a large number of folks are in denial with regard to how drastically the environment has changed. The only solution that is proposed by many of these individuals is to “raise taxes.” Without getting into a debate over whether this is the right solution, it isn’t going to happen in the current political environment.On the other hand, I am gratified by the increasing number of administrators and faculty who are beginning to “get it.” Specifically, they are understanding that how they used to operate in the 80s/90s and even the last decade will not work today.Other than the obvious issue of the inability for governments to fund education at a higher level, I see one major issue. That is is that government is currently focused more on expenses as opposed to investments. Further, the investments that should have been made in the past in order to ameliorate the current financial chaos were not made. (Case in point, the severe underfunding of retirement/health benefits now coming due.) This “investment” quandary is a serious one for some states who are seeing an exodus of graduates due to the shambles of their economies. Why invest if students are only going to leave the state? And if we don’t invest, then are we promoting the exodus? And if students leave the state, who will help us recover?With the severe reductions in state support, more “public” institutions are gravitating to acting more like privates — building their development infrastructure and looking for building of their big endowments. I have heard of some public universities contemplating conversion to private. I don’t know what chaos this would bring if it would ever happen, but it would be interesting to see what would fill the ensuing vacuum.
mbelvadi - April 5, 2010 at 1:08 pm
I found this quote in the article very interesting: “but their faculty members not only do research, but are expected to do research, especially given that the rhetoric of the colleges is about making a positive economic impact on the state”. Is there any evidence at all that the kind of research done in public universities has an economic impact on that particular state that fully offsets the state’s investment in it? I’ve always thought that taken as a whole, American non-profit higher ed has made the argument that universities must do “basic research” (that is, research that can’t be monetized) as part of building the underlying foundations that applied research done in corporations actually profits from (and presumably creates jobs from, thereby returning the wealth to the society via taxes, or so the story went). I sense a “tragedy of the common ground” problem arising here, as each individual state probably rightly perceives that the return to their own coffers of basic research expenditures isn’t worth the investment, if their corporations can use the fruits of research done and paid for by other states instead. And of course, I haven’t even touched on the cost of faculty research that doesn’t seem to have any monetizable value at all to anyone, which unfortunately seems mostly to be in the humanities. I have yet to figure out how yet another book analyzing themes in yet another obscure 18th century European author’s fictional writings is ever a good investment for taxpayers in middle America to support. Please enlighten me.
intered - April 5, 2010 at 2:08 pm
In the link above, I point out several ways college administrators can balance their budgets without raising tuition or asking for more money. Few of them take these ideas to heart. Shame on them.That said, as a society, we have determined that not all programs can or should demonstrate positive financial ROI. Some programs go to the common good and I, personally, would not want to lose them. I do, however, believe that the process by which public money is allocated to course development is excessively, even rigorously, private and often serves the interests of the professor over the needs of the market. Most public universities offer too many degrees for which there are no jobs or even eager students. Public input should be part, but not all, of the decision process in managing the university catalog.The research issues are more complicated. There is no doubt that basic and applied research contribute to social good. Some ways are obvious (science and technology) while others require a sophisticated eye (less than 50 years ago, a philosopher invented the foundationally new discipline of evaluation science and it is now ubiquitous in our society, contributing to intelligent consumer choice, expert system algorithms, and more; for that matter, philosophers and others in the humanities made material contributions to modern day computing). Yet many of the journals that have sprung up in response to university hiring and promotion requirements can claim no more than a tenuous claim to having advanced knowledge in any material way. They represent the market’s response to the precipitous growth of higher education combined with the unjustifiable emphasis on publication as a primary consideration in promotion. While universities pay lip service (and occasionally a brass & walnut plaque) to quality teaching, they pay real money for research grants and publications. Whatever position one takes on the research issue, I would hope they will agree to correct one egregious problem: the conflation of the research and teaching functions such that we get ring around the rosy answers when one attempts to assess productivity in either domain. These functions need to be distinguished, not necessarily separated, and accounted and evaluated for separately. It is bad policy when the bad teacher/prolific researcher profile makes more money and enjoys greater job security than the good teacher/unproductive researcher profile. Ideally, we need both but we need the latter more. (NB: Please, let’s not trot out the empirically vacuous claim that the best teachers are the best researchers. To the limited extent that this is true, it applies to top students who plan to become researchers themselves. Now that higher education is a large and diverse set of markets serving individuals possessing a wide range of interests and abilities, we need good teachers more than anything.)————————–Robert W TuckerPresidentInterEd, Inc.www.InterEd.com
diehl - April 5, 2010 at 5:27 pm
State funding for higher education as a percentage of state budget:New Jersey1989 6.1%1999 8.3%1009 7.4%California1989 15.6%1999 7.9%2009 7.2%According to these numbers, New Jersey is doing pretty well. I think there is a lot of middle management at universities with large salaries (senior, executive, vp titles abound). Too much money is spent on “enrollment managment” (used to be called Admissions) and they are called the ‘revenue generators.’ I thought revenue was generated when a student paid tuition for taking a class from a professor. There has not been a long term investment in faculty (just a lot of short-term investments on recruiting students). If we invest in faculty, we can improve graduation and retention outcomes. For example, increase first year retention beyond 70%. Also, increase 4 year graduation rates beyond 36%. We could implement a lot of other assessments, but those two are good starts. Put top notch instructors in the intro, freshman classes. Over 80% of our faculty should be full-time not 49%.
rightwingprofessor - April 6, 2010 at 9:10 am
Can someone explain to me how it is in the taxpayers interests to heavily subsidize “in-state” students at the local state university, when young people are so mobile these days?
intered - April 6, 2010 at 1:13 pm
#9. From the perspective of a state’s self-interest, it is often not in the taxpayers’ interests to structure differential support for in-state and out-state students. The thinking traces to analyses and common sense based on behaviors in the earlier 1900′s. That said, taxpayer funds are so perversely co-mingled that it is little more than metaphor to speak as if taxpayer sourcing can be identified. The most logical approach (based on financial empirics) would be for a state to decide how much it wants to support higher education and provide the support based on demonstrated impact, irrespective of the institution’s charter. They could do even more. These days, it would be easy to develop migration indices by program by state state (engineers leave the state for school x, teachers at school y stay in-state, etc.) and add that index to the funding formulae. Or, they could say, you’re on your own. You have 10 years to make the transition.You identify a generic problem in the funding formulas in many areas of state and federal funding. Given the fact that we can’t even pass a bill that will keep the financial industry from gambling with our money and making us pay if they lose, what do you think the chance is that anyone will get around to caring about this inequity?