Office of Planning and Budgeting

New OPB Brief

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This week, UPenn’s Institute for Research on Higher Education (IRHE) released a report assessing the state of higher education policy in Washington State. While satisfactorily describing the key facts and long-term trends and potential future problems for higher education in Washington State, the report is somewhat unrealistic in its recommendations. It seems to assume that, absent any change in state funding trends, policymakers can dramatically alter educational attainment via structural changes in governance.

Read the latest OPB brief for more information.

With the special legislative session wrapped up here in Washington, and regular session not set to begin until January 9th, here is some of what has been happening in higher education elsewhere.

Federal Budget Agreement Preserves but Alters Pell Grants: It appears that a last minute FY2012 budget agreement in Washington DC will avert a federal government shutdown. It is reported that this agreement, which cuts billions of dollars and increases NIH funding by a modest one percent, preserves the maximum Pell Grant amount of $5,500 (a priority for Democrats), but alters eligibility. Under this language, Pell grants could only be used for 12 total semesters, not 18. Additionally, the annual income threshold at which a student is automatically determined to have zero Expected Family Contribution (EFC) is lowered from $30,000 to $23,000. Stay tuned to the Office of Federal Relations  for frequent updates on these budget negotiations.

Berkeley Unveils New Aid Program: UC Berkeley made big news this week for announcing a new financial aid program aimed at middle class Californians. Students from families making up to $80,000 per year already attend UC schools tuition-free in California. Under this new plan, UC Berkeley students from families making between $80,000 and $140,000 will have to contribute a maximum of 15 percent of annual income toweard the total cost of attendance at Berkeley (currently $32,000, including room and board). The student would also have to contribute about $8,000 per year via loans, work study or scholarships. According to the New York Times, based on current costs, this programs represents a discount ranging from 10 to 37.5 percent for families that fall within the specified income range. A number of private insitututions have similiar programs, but Berkeley is reported to be the first large public institution to follow suit.

Lariviere Out, Berdahl in at Oregon: After less than three years, Richard Lariviere has been fired by the Oregon State Board of Higher Education as President of the University of Oregon following a year in which he found himself at odds with the state System as he pushed for greater independence for the University of Oregon. The controversial move to oust a President who enjoyed student, faculty, and alumni support, was immediately followed by the appointment of Robert Berdahl as interim president. Berdahl is a former long-time University of Oregon professor and Dean, and has also served as the President of the University of Texas, and UC Berkeley Chancellor, among other roles. Berdahl recently ended his tenure as AAU President and took a highly publicized position as a part-time advisor to Lariviere at the University of Oregon.

More Higher Ed Cuts in CA: California Governor Jerry Brown announced another billion dollars in mid-year state  budget cuts this week as yet another growing budget deficit loomed. The mid-year cuts include another $300 million reduction for the state’s three higher education systems (UC, CSU, and community colleges), which comprise the largest public higher education system in nation. While UC hopes to use temporary funds to bridge this latest cut for a year, further capped enrollments and tuition increases may be likely throughout the system.

VA Announces New Investments in Higher Ed: Meanwhile, Virginia is one of the only states increasing higher education funding. Governor McDonnell announced a new $100 million in funding for higher education, alongside new capital funding for longer term growth. The money is intended to support the goals contained in legislation passed last year, including increasing college attainment in Virginia, increasing affordability, and increasing the number of STEM and health related degrees awarded.

A new telephone survey, conducted by the Public Policy Institute of California, suggests that although Californians appreciate the quality of their higher education system, they are concerned about the direction in which it is headed. In fact, only 28 percent of Californians think that the system is headed in the right direction, while 62 percent claim it is headed in the wrong direction. While respondents still believe higher education is integral to future success in the workplace, they are worried that affording higher education is becoming increasingly difficult.

Californians’ main concern for the future of higher education is affordability. 61 percent believe affordability is a big problem. Among parents of college students in California, 77 percent are very concerned about the increasing tuition. Fully 69 percent of Californians do not believe we should increase fees to fund higher education. Furthermore, only half of respondents agree that financial help is available for those who need it, and 75 percent believe that students must borrow too much for college.

Respondents mainly blame California’s government for the declining affordability of higher education. Only 29 percent think Governor Jerry Brown is handling higher education well, and only 14 percent think the legislature is doing a good job. 74 percent say the state does not fund higher education adequately. This assertion breaches the ideological divide, with 58 percent of Republicans agreeing that more funding is needed. However, respondents are split on their willingness to pay higher taxes to support higher education (52 percent unwilling, 45 percent willing).

To read more about the survey, check out the full report here.

The Times Higher Education/Thomson Reuters World University Rankings for 2011-12 were released today and the University of Washington ranked 25th, one of only five public US institutions to make the top 25 (UC Berkeley was the highest ranking US public at 10).

US News and World Report recently ranked the UW 42nd among all national universities in the US, while the Academic Ranking of World Universities ranked the UW at 16.

These rankings help to validate the world class teaching, research and service that take place here at the UW every day. However, it is good to cast a critical eye on the business of ranking universities in general, and this column published by Inside Higher Education does a great job of summarizing some of the questions we should always ask of such ranking endeavors.

The controversial US News and World Report University Rankings have been released for 2012 and are freely available online for a limited period of time. The University of Washington slipped one spot to 42nd among National Universities in the US. The UW, however, comes in at the 10th best public institution in the nation.

Although the US News rankings have long been dominated by endowment-rich private institutions, it is notable that no public institution makes the top 20 anymore. A recent Washington Post article reported that, over the past 20 years, the five highest ranked public institutions have each dropped seven or more spots in the rankings.

In previous posts we have laid out the massive resource gap between public and private institutions that has widened over several decades and is reflected in these rankings:

Across the US, deep cuts in state funding for public higher education have accelerated this trend dramatically over the past three years. In response, the Seattle Times Company and several partners have formed to create the Greater Good Campaign to highlight the risks this trend poses to public higher education in Washington State and to the future of Washingtonians.

Inside Higher Ed published a feature today detailing an ongoing process that has 27 universities, US and abroad, competing for a gift of land in New York City plus $100 million in exchange for the creation of a new tech-centered campus. Several New York based universities are submitting proposals, due in October, but notable universities from elsewhere such as Stanford and Chicago are also competing for the opportunity, as well as universities based in other countries.

As pointed out in the article, New York already has 110 institutions serving over 600,000 students. However, engineering and tech programs in the region have lacked the success and reputation that the city would like. While institutions with an existing presence in NYC or in the region may make more sense as a partner in this project, Stanford appears to be aggressively pursuing the opportunity, touting its role in the creation of Silicon Valley in California. If successful, this would be Stanford’s first campus outside of Palo Alto.

The absence of public universities on the applicant list is stark. Purdue is the only one. However, this is perhaps unsurprising given the billions of dollars likely required to build a fully operational campus from scratch in a short period of time, and the state-centered history of public institutions in the US.

For the lucky institution with the right amount of resources, this will hopefully be a great opportunity with long lasting effects for the institution and the city of New York. For all of higher education, it will be fascinating to see if this kind of partnership between government and  institutions can work to create a new, physical campus that can quickly produce innovation and education while building and maintaining a reputation for excellence.

We’ve blogged previously about the controversial reforms being aggressively pursued by Governor Perry and various of the appointees he has placed on Texas higher education governing boards and in university administrations. The reforms were initially developed by the conservative think tank the Texas Public Policy Foundation (TPPF), and are centered around placing the student in a stronger consumer role, basing professor pay and tenure more directly on student evaluations, creating a bright line between teaching and research funding, and changing the state funding model from one that subsidizes institutions to one that provides grants directly to students. Many may recognize these as reforms long advocated for in the K-12 sector for some time.

After a protracted battle between a variety of interested parties (academics, administrators, legislators, state leaders, alumni, lobbyists and more), the University of Texas System Board of Regents unanimously approved what they called ‘A Framework for Advancing Excellence Throughout the University of Texas System‘ at their May meeting. An action plan released last week provided a glimpse at the compromises made to quell strong opposition.

More flexible than initially feared, the action plan allows institutions to tailor the reforms to their institutions. Major system-wide goals include:

  • Increased degree production
  • Increased use of online and blended instruction
  • Development of performance incentives for professors
  • Strengthening of post-tenure review for professors
  • Creation of external review for schools and colleges within the institution
  • Critical review of PhD programs and decreased time to PhD
  • Increased research collaboration, especially with non-academic partners
  • Increased research and philanthropic funding
  • Increased administrative efficiency through standardized systems, sharing of services, and better space utilization

Although much less divisive than the specific reforms championed by TPPF, these goals are ambitious enough to put Texas in a category of its own nationwide. How  individual institutions endeavor to implement the action plan in the near future, and the extent to which they engage faculty in the process, will likely determine the mood and direction in Texas public higher education for some time.

In the meantime, Florida Governor Rick Scott is indicating a desire to follow Rick Perry’s lead on this issue.

  • UW  Ranked 16 in the world: The annual Academic Ranking of World Universities (ARWU), compiled by Chinese university Shanghai Jiao Tong, places the University of Washington at number 16 in the world. The rankings are heavily based on institutional and faculty achievements in STEM fields, including number of Nobel prizes and Fields medals won, and various citation measures. The US dominates this list, with 17 of the top 20 slots and 151 of the top 500.
  • Ohio latest state to consider greater autonomy for public institutions: In a reversal of previous reforms that attempted to consolidate the university system in Ohio, Governor Strickland endorsed the idea of ‘enterprise universities’ in his state budget, released March 2011. Chancellor of the Ohio Board of Regents Jim Petro was tasked with creating a detailed plan for legislative consideration. He unveiled The Enterprise University Plan last week. The plan provides three levels of increasing autonomy from various state government requirements in exchange for a reduction in per student funding of 10-20 percent. The state would continue to cap tuition increases at 3.5 percent per year. While the support of Ohio State President Gordon Gee looks likely, it is not yet clear how other universities or faculty members and legislators will react to this plan as many large questions about both intended and unintended consequences have already surfaced. For related information see our previous post, Quest for Greater Autonomy for Public Higher Ed Continues, and our OPB brief on institutional autonomy.
  • Federal government joins lawsuits against for-profits: After implementing significant higher education regulation reform through the Department of Education, the Obama Administration shows a commitment to act by joining existing and new lawsuits against several for-profit higher education institutions accused of violating federal law. For related posts, see Federal Scrutiny of For-Profits Spurs State Action.

Kiplinger has released a map showing average student debt versus average income across all fifty states, as well as categorizing institutions they have identified as the most expensive and the ‘best values’.  The UW comes in as the 10th best value public institution in the nation for 2010-11.

The map illustrates that Washington state students have a relatively low debt to income ratio: Average student debt is between $15,000 and $20,000, while average income is around $40,000 to $50,000, with about 61 percent of all students in the state taking out loans. Utah boasts the smallest amount of debt per student (under $15,000), while New Hampshire has the highest average debt load (over $25,000 per student).

These state level data are consistent with our most recent UW data. In 2009-10, 50 percent of all UW undergraduates borrowed and their average cumulative debt was $19,500. Although these figures are lower than the national average, they have increased over the last several years, especially as state funding cuts have necessitated tuition increases. This is why the UW Board of Regents voted to substantially increase the UW’s commitment to financial aid for resident undergraduate students starting this fall.

Note that Kiplinger also shows that students appear to be increasing their use of credit cards while in college, with 84 percent of students holding at least one credit card and half of all students holding four or more. The mean credit card balance was a record $3,173.

The Institute for Higher Education Leadership & Policy at California State University, Sacramento recently released a report titled “Consequences of Neglect: Performance Trends in California Higher Education.” The report claims that, although California is considered the world’s leader in public higher education, the state’s college and university system is closer to average—and may be declining.

The report uses six measures of higher education quality and access—preparation, affordability, participation, completion, benefits, and finance—to measure California’s performance in relation to other states. Their findings, if correct, are troubling:

  • Preparation: The report uses graduation rates, standardized test scores, and the percentage of students taking college preparatory classes to measure preparation for college. According to the report, college preparation in California is worse than most states, particularly in rural and inland areas and for black and Latino students. However, these measures have been steadily improving over the past seven years.
  • Affordability: Without taking into account room and board, the California system ranks high in affordability (largely due to the very low tuition at California community colleges), however, because of the high cost of living in California, affordability is significantly compromised. Furthermore, tuition and fees have been increasing dramatically at UC, CSU, and CCC, which will negatively impact affordability.
  • Participation: One of the highlights for California is that participation in public higher education remains high (California ranks 6th in the percentage of 18-24 year old enrolled in college), though the trend is declining as tuition and fees increase.
  • Completion: Although California ranks 12th in the nation in the number of associate degrees awarded per 100 high school graduates, it ranks only 41st in the number of bachelor’s degrees awarded per 100 high school grads. The report suggests focusing efforts on improving the transfer process from California’s two-to four-year institutions.
  • Benefits: The report lists benefits from education in California as average, with high personal income tempered by low proportions of citizens with bachelor’s degrees and very low voter turnout.
  • Finance: State appropriations per student FTE in California are slightly lower than the national average, and local and state funding has been steadily decreasing during and after the Great Recession.

The report urges California’s government to protect their investment in colleges and universities, long considered the best public higher education system in the world. Furthermore, it cautions policymakers not to be blinded by the stand-out performances of a select few California universities, while ignoring the vast majority of California’s higher education institutions that may be struggling.

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