Higher Education Finance Issues in the Early 1990s

1972

10 9 nation's 2,340 institutions were either "headed for trouble" or already "in financial 9 difficulty. " Cheit's projections, too, showed that cost growth probably will outstrip income growth by an annual margin of several percentage points, meaning that schools must find even more new money, make even greater expenditure cuts, or do both. "Crisis" in Perspective There can be no doubt of the widespread, serious, and immediate financial difficulties among our colleges and universities. Whether there is a general, long-10 run financial crisis, however, has been questioned by some observers. Their contention is that the current "crisis" is more a composit of quite different kinds of financial difficulties plaguing different kinds of institutions, ammenable to different remedies, and carrying quite different long-run implications. Research universities for example, are suffering heavily from cutbacks in federal research grants and graduate student fellowships, exacerbated by over-commitments to expensive tenured faculty made during the period of rapidly increasing federal 9 Carnegie Commission on Higher Education, press release, December 3, 1970.

The Journal of Higher Education, 1997

To examine the accuracy of myths of state higher education finance trends, this study used data from 50 states to explore recent patterns in funding allocation, state policies, and system characteristics. Data were gathered through development of a database on state system characteristics and trends and through two surveys sent to state higher education executive officers soliciting information on appropriations and budgeting, linkages affecting appropriations and tuition, cost containment strategies, policy goals and state financial aid policies. Findings included the following: (1) unmet student financial need has been increasing in all states; (2) most states mount no systematic effort to link appropriations for institutions and student aid to public tuition rates; (3) only 26.7 percent of respondent states have discussions underway to adopt market approaches to tuition; (4) states that spend more on subsidies for their public systems also spend more for financial aid appropriations; (5) in general, any direct link at the state level between state aid appropriations, state appropriations for public institutions and tuition levels for public higher education is a myth; and (6) few states have enacted policies to link tuition levels at state institutions to levels of state financial aid available. An appendix contains additional tables. (Contains 39 references.) (JB)

American higher education, according to the authors, is facing a financial crisis that can be alleviated only by drastic, increased federal support to the educational system. Presented in this document is a review of the financial history of American colleges and universities, a look at the present situation, and a preview of the future picture of higher education. Following the past, present, and future review is a discussion of whether a federal role in financing is implied, how much aid should be appropriated, and what form this aid should take. It is suggested that the federal government adopt a financial aid program that would combine institutional and student aid. An institutional grant and student loan program is offered as one major alternative. (HS)

2014

http://ann.sagepub.com/content/655/1/143 The online version of this article can be found at: DOI: 10.1177/0002716214540849 2014 655: 143 The ANNALS of the American Academy of Political and Social Science Michael K. McLendon, David A. Tandberg and Nicholas W. Hillman Student Financial Aid and Campus Appropriations, 1990 through 2010 Financing College Opportunity: Factors Influencing State Spending on

1970

This paper is a criticism of "Finance and the Aims of American Higher Education" by Howard R. Bowen (HE001412). VeEring toward "free education" is inconsistent with ordinary notions of equity beCause: (1) the purely private benefits of higher education accruing directly to the individual are s,ub.s;tantially greater than all costs incurred, and (2) individuals who attend college, as a group, ccme disproportionally from upper income families. A policy of high tuition, even higher than actual costs, for those who can afford it and substantial aid to those who can't would be more equitable. A.l ow tuition policy may also adversely affect an institution's ability to maintain academic freedom and determine its own programs, because of its increasing dependence on the action of legislators. Pressures on governmental budgets are increasing at all levels and there is little likelihood that there will be a substantial increase in governmental support. Income from tuition will be essential to cover widening educational opportunities and instructional costs which, otherwise, will continue to exclude many individuals with real economic need from higher education. High tuition and high student aid are complementary. (AF)

OECD Economics Department Working Papers, 2007

America's higher education system is among the best in the world. Nevertheless, there is scope for improvement. In particular, there appear to be substantial financial barriers to higher education despite large government expenditures aimed at promoting access. Policy makers have proposed addressing these barriers by increasing student grants. However, grants are costly, inefficient, inequitable and ineffective. Income tax concessions and state government subsidies suffer from similar problems. In contrast, international best practice seems to be converging on student loans with repayments that vary according to income. Income-contingent loans facilitate access to college at low fiscal cost and without the inefficiency and inequities that accompany grants, subsidies or tax concessions. At the same time, they do not discourage risk-averse or uninformed students in the way that conventional loans do. The United States has an income-contingent loan programme that should be expanded. While the design of repayments could be improved, the main problem with this programme is that lending limits are too low. Higher limits, especially for unsubsidised direct loans, would benefit students and promote access at little cost to the government. Were a good system of loans in place, then less cost-effective means of promoting access, such as grants and tax concessions, should be cut back.

2016

T his report draws upon National Surveys of Access and Finance Issues for the five years following the end of federal stimulus funding during the Great Recession. What has happed to public education and why? We find the following: The economic recovery following the Great Recession continues: In 2015 legislative sessions, respondents from just ten states report "Recession, producing a decline in state revenues" as a top budget driver, the lowest rating since 2006. As in 2014 7 , during 2015 state legislative sessions, Elementary and Secondary Education and Medicaid were the top two budget drivers. Respondents from just six states report midyear cuts at their public community colleges and regional and flagship universities. But competition continues to be fierce: Public higher education competes with transportation/highways, unfunded pensions, corrections, tax cuts, and health care costs associated with the Affordable Care Act for new revenues. 8 Given the need to fund K-12 teacher and state employee salary increases and long-delayed infrastructure, public higher education faces fierce competition for state tax revenues in 2016. The recovery of operating budgets is slow: State appropriations for elementary and secondary education, community colleges, regional universities, and flagship universities for FY2015-16 are predicted to increase by 3%, 3%, 2%, and 2.5%, respectively. But state appropriations fail to cover the predicted 2.1% Higher Education Price Index 9 (HEPI) 2015 inflation rate for community colleges in 18 states, regional universities in 17, and flagship universities in 16 states. Since the Great Recession, most states have not appropriated at inflation levels. In the five years since federal stimulus funds ended in 2011, just two states appropriated operating funds for public higher education at or above the rate of inflation. Tuition hikes continue due to state disinvestment: States that choose to appropriate operating budgets below the inflation rate force their institutions to raise tuition. In FY2015-16, tuition will rise at community colleges, regional universities, and flagships by 3%, 4%, and 3.5%, respectively. Tuition is predicted to rise above the 2.1% HEPI for community college students in 25 states, regional university students in 28 states, and flagship university students in 26 states. State student aid is not keeping up: In 2015, as in the preceding four years, two out of three states report increasing state student aid below the HEPI inflation rate. Policy alignment exists in just two states: "High tuition/high aid" requires policy align ment, but operating budgets, state student aid, and tuition policies are unaligned in six of every seven states in 2015, and in every year since 2011. Access threats exist in 16 states: Respondents report access threats (enrollment caps, turning away students, insufficient capacity, etc.) for each of the three public higher education sectors. These 16 states enrolled 41% of all students nationwide in Fall 2013. Rural community colleges face the greatest fiscal strain. Over half of respondents predict their urban and nearly half predict their suburban community colleges will face great fiscal strain, but nearly all report their rural community colleges will do so.

Academe, 2004

Recent shifts in state funding are altering the most basic realities of American higher education, from student access to faculty research.

2001

As background to the National Dialogue on Student Financial Aid, this essay discusses the fundamental assumptions and aims that underlie the principles and policies of federal financial aid to students. These eight assumptions and aims are explored: (1) higher education is the province of states, and not of the federal government; (2) the costs of higher education are appropriately shared by taxpayers, parents, students, and philanthropists; (3) the role of the federal government has been to make up what low- and middle-income families cannot afford or can not borrow to bring at least state-sponsored public higher education within reach of any student who also will contribute through earnings and loans; (4) the role of the federal government is also to make student loans widely available; (5) the extent of state support is a policy decision appropriately made at the state level; (6) federal student aid is given without regard to academic promise or potential and with only minimal re...

2006

2001