States Making Choices that will Hurt College-Bound Students
By Jazelle Hunt, NNPA Washington Correspondent
WASHINGTON (NNPA) – During the recession, states’ education expenditures—like everything else—took a substantial hit. But a new report from the Center on Budget and Policy Priorities finds that even as the nation recovers, most states are still funding their public colleges well below pre-recession levels, with eight states continuing to make cuts.
The divestment is feeding a two-pronged stumbling block to success for today’s college students, especially those of color and/or from low-income homes, who are more likely to attend in-state public institutions.
First, these budget cuts are affecting the quality of education at public colleges and universities.
“States (and to a lesser extent localities) provide 53 percent of the revenue that can be used to support instruction at these schools,” the report states. “When this funding is cut, colleges and universities generally must either cut educational or other services, raise tuition to cover the gap, or both.”
These cuts often result in the loss of full-time, expert teacher positions in favor of switches to adjunct (contracted) instructors, the disintegration of entire departments and majors, truncated access to resources such as computer labs and libraries, and more.
For example, in 2011 the University of North Carolina at Chapel Hill eliminated 16,000 course seats, four of its computer labs and two distance education centers. In 2012, Louisiana State University eliminated 1,210 full-time positions, including more than 220 faculty members. The University System of Georgia has merged independent state schools five times in the last two years. Nationwide, the number of faculty per student has declined.
In addition to the decline in educational quality, the decline in state investment is resulting in long-term financial instability for today’s students.
There’s the national trend known as the Great Cost Shift in which students and families, particularly low-income households, are shouldering more of the cost of keeping public colleges afloat. According to the report, enrollment fees, tuition, and other student charges accounted for 24 percent of state schools’ revenue in 1988. Today, schools rely on student charges for 48 percent of their revenues. Stated differently, in 1988 schools received 3.2 times as much in revenue from state and local government as they received from students in 1988—today, it’s just 1.1 times as much. In fact, at that time only two states—Vermont and New Hampshire, both very affluent—had average tuition amounts larger than state expenditures. By 2008 that had grown to 10 states, including Michigan and Pennsylvania, which both have significant poverty. In eight states (including a few with large Black populations, such as Louisiana, Alabama, California, Georgia, and Florida), average tuition has jumped by more than 50 percent in six years.
The Great Cost Shift is directly feeding swelling student debt.
According to a 2012 report from the Center for American Progress, 81 percent of Black students who earned a bachelor’s took on debt to do it—and 27 percent of these students are on the hook for $30,500 or more. Earlier this year, the United Negro College Fund, the largest and oldest private minority financial aid organization, called for emergency aid to supplement the weakened public financial aid system. By the end of 2013, student loan debt had surpassed car and credit debt, with American students borrowing more than $1 trillion to pursue degrees.
“As students are asked to shoulder a greater burden, they resort to borrowing,” says Michael Mitchell, co-author of the report. “Over 2008 to 2012, there’s been a major increase in debt, especially for low-income families, because financial aid is no longer covering the costs.”
And the financial indebtedness extends well past college.
In an effort to mitigate costs, students, especially low-income students, are choosing less competitive and less selective intuitions, despite being academically qualified for more prestigious institutions.
“Where a student decides to go to college has broad economic implications, especially for disadvantaged students and students of color,” the report states, citing a 2011 study which found that, “students who had parents with less education, as well as African-American and Latino students, experienced higher postgraduate earnings by attending more elite colleges relative to similar students who attended less-selective universities.”
There are the students who aspire to attend college but are deterred by the rising cost and even their family’s ineligibility for loans. As of 2008, only 44 percent of high-scoring students in the bottom 25 percent of household income enroll in college, compared to the 80 percent of students in the top income bracket. According to research cited in the report, 65 percent of all American jobs will require at least some college by 2020.
Ultimately, this widespread disinvestment and its results have implications for the future of the American economy, which makes it difficult for recent college graduates to enter the middle class. This debt deters many from even attending college. Those who do attend and graduate go into repayment and cannot afford homeownership, advance degrees that qualify them for highly skilled careers, or full participation in the economy as a consumer.
“College attainment has grown increasingly important to long-term economic outcomes for states and the nation. Research suggests that states should strive to expand college access and increase college graduation rates to help build a strong middle class and develop the skilled workforce needed to compete in today’s global economy,” the report stated.
While these cutbacks in higher education funding were undoubtedly caused by the recession, current state tax and budget decisions are perpetuating the decline.
“While some states are experiencing greater-than-anticipated revenue growth due to an economy that is slowly returning to normal, state tax revenues are barely above pre-recession levels,” the report explains. “To bring higher education back to pre-recession levels, many states may need to supplement that revenue growth with new revenue to fully make up for years of severe cuts.”
The report also highlights Florida as an example of poor budgeting. According to the report, Florida’s higher education funding is 30 percent below 2007 levels, while tuition at its public four-year schools is up 66 percent. Despite this, the legislature has cut taxes by $400 million, making it financially impossible for the state to adequately reinvest in its college students.
“I can’t stress enough how much the source of these problems are policy choices, not income,” says Mitchell. “Essentially state law makers are making decisions today that will have serious economic significance for students later in life.”
Federal financial aid has significantly increased since the recession. Between 2007 and 2013, need-based Pell grants have doubled, allowing the government to not only award students, but also increase the individual award from $2,975 to $3,704, on average. The report also cites College Board data, which finds that this and other federal measures have offset 73 percent of the tuition hike paid by the average American student.
The extra federal funding is also largely a stopgap measure. According to the report, the approved House of Representatives 2015 budget proposal calls for a $125 billion cut in Pell grants over the next decade, plus new eligibility restrictions and a cap on grant amounts.
However, the funds have already gone a long way at community colleges, where out-of-pocket cost for the average student is on the decline.
“It’s impossible to overstate the impact of the recession, but states had the option of taking a balanced approach over the course of the recession,” Mitchell explains. “As revenues start to come back to pre-recession levels, state legislatures really have a choice to make now to rebuild their states’ higher education systems.”