- The Washington Times
Wednesday, July 20, 2011

Parents and students are bracing for a new round of sticker shock this fall as public colleges and universities are hiking prices again, this time to make up for massive cuts in state budgets.

Half of all states cut higher-education funding in their fiscal year 2012 spending plans, some by hundreds of millions of dollars.

The University System of Wisconsin, for example, lost $125 million in state funding. It responded by raising tuition 5.5 percent, which is expected to generate $37.5 million in additional revenue to help plug the gap.

UW System President Kevin P. Reilly called the cut and subsequent tuition hike “a tough pill to swallow,” and UW may also increase class sizes, cut back on research, shrink study-abroad programs and take other cost-cutting steps.

The story is the same at public systems in Pennsylvania, Arizona, Washington, Florida, Oregon, Texas, Georgia and elsewhere.

The University of Virginia is raising tuition 8.9 percent, Virginia Tech by 9.2 percent. On the other side of the Potomac, the University System of Maryland will raise tuition 3 percent at 11 of its 12 campuses. The exception is Salisbury University, where rates are going up by 6 percent.

An informal sampling by The Washington Times of 17 public institutions in 14 states - both individual campuses and entire systems - found an average increase of 9.8 percent, compared with fall 2010, with increases of about 20 percent at some.

With general inflation at just 3.6 percent over the past 12 months, according to the most recent figures from the Bureau of Labor Statistics, tight state budgets are the real culprits.

The University of Michigan lost $47.5 million this fiscal year, prompting a tuition increase of 6.7 percent.

Lawmakers in New Hampshire chopped funding for the state’s university system by $48.4 million, and school officials responded by raising tuition at each of its five campuses. Penn State University saw a $68 million cut, quickly followed by a 3.8 percent tuition increase.

But they pale in comparison with the University of California, which lost a whopping $650 million and will raise fall tuition rates by 18 percent.

California State University, the state’s other public system and the nation’s largest with more than 400,000 students on 23 campuses, plans to increase prices by 22 percent, the Associated Press reported.

For state legislatures, the choice isn’t easy, but lawmakers need to balance the books somehow. Forty-nine states are constitutionally required to stay in the black each year, and higher education is often a more appealing target than reducing funding for corrections or services for the elderly and disabled.

“Legislatures are starting to rethink higher ed,” said Richard Vedder, director of the Center for College Affordability and Productivity. “If they have a choice between funding for the elderly or subsidizing the upper-middle-class kid to go to college … subsidizing the middle-class kid to go to college is a lower priority.”

While many states are also cutting K-12 education, Mr. Vedder argued that carries much more political risk. School districts often respond to funding cuts by raising taxes, while colleges and university systems respond by raising tuition. Tax increases, even at the local level, get elected officials in trouble. Tuition increases at colleges usually don’t.

“At the time the tuition goes up, it affects 2 [percent] or 3 percent of the state’s population,” Mr. Vedder said.

“If taxes go up, it affects 100 percent of the population. The K-through-12 lobby among the people is vastly greater.”

Tuition increases are hardly new. Each year since 2000, the average price at a public, four-year university has risen 5.6 percent, according to the College Board Advocacy and Policy Center, which tracks prices and college access.

Despite that trajectory, many institutions find it difficult, if not impossible, to start handing out pink slips or shut down programs and classes. Facilities still get built, and tenured professors still get raises, no matter how dire the financial situation becomes, Mr. Vedder said.

“Universities, faced with state budget cuts, can do two things: They can actually cut back a good bit on what they do and the amount of money they spend and make some real savings,” he said. “But the standard answer for everything is to raise tuition.

“Colleges are loath to make real cuts. I don’t see concerted efforts to cut costs, and the reason is there’s no incentive,” Mr. Vedder said. “The way to get ahead, keep your job and make people happy is to spend money.”

Tuition increases usually won’t sway a student’s decision, especially a student who borrows or relies heavily on Pell Grant or scholarship programs, he added.

A sense of competition among colleges often compounds the problem. Mr. Vedder said university leaders are reluctant to increase class sizes or cut expenses when their competitors are hiring more professors, offering new programs and building a new football stadium.

Eventually, however, students and parents may reach their breaking point. For-profit institutions and community colleges have seen significant growth in the past few years as students seek cheaper alternatives.

Some universities are realizing they must adjust to a new normal in terms of funding. In a July 15 statement, Penn State’s board of trustees outlined steps it is taking - in addition to the tuition increase - to reduce costs.

The university renegotiated health care benefits and property and liability insurance, froze salaries for faculty and staff, and offered early retirement to some senior professors.

“We are determined that our students and their families will not bear the full burden of the appropriation cuts,” Penn State President Graham B. Spanier said in the statement.

“The cost-cutting measures we’re taking involve significant sacrifice on the part of the university community as a whole, but they’re being done with the goal of allowing students to continue to pursue a Penn State education.”

In addition to its 6.7 percent tuition increase, the University of Michigan is increasing its financial aid budget by 4.9 percent, pumping $137 million into the system, which is available to families with incomes of less than $80,000.

The institution’s employees are now paying more for their health insurance, and some classes are being offered less frequently.

It’s not easy, but it’s reality.

“The University of Michigan is prepared to share in the pain this coming year,” University President Mary Sue Coleman said in a June 16 statement announcing the tuition increase.

• Ben Wolfgang can be reached at bwolfgang@washingtontimes.com.

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