College tuition has little link to state funding, analyst determines
College tuition tends to rise regardless of how much money the state puts toward education, a new study reveals.
Tuition goes up no matter what state legislators do," analyst Preston Cooper wrote after studying tuition trends for the American Enterprise Institute. "Public colleges, with state boundaries insulating them from competition, and generous federal student aid programs at their disposal, charge as much as they can get away with. Changes in state funding are largely irrelevant."
In Illinois, schools needs more and more money to fund runaway pension costs, not to pay for anything instruction-related, he said.
“Students have absolutely been facing higher tuition costs, and that’s a problem," Cooper told the Sangamon Sun. “But too much blame has been put on ‘state disinvestment’ and not enough on other factors, such as a lack of competition and generous federal subsidies.”
After comparing tuition levels and state funding adjustments over an 11-year period commencing in 2004, Cooper concluded that even if states like Illinois had kept higher education subsidies at pre-recession levels, the trend of increased tuition would still be happening.
Cooper argues that the key to bucking the trend could lie in adopting a system that brings about greater competition and accountability.
“One way to accomplish this is to stop giving money directly to public colleges and instead use it to give students financial aid grants,” he said. “The students could take the grants to any college they choose — meaning universities would have to prove to students that they’re worth it before getting taxpayer money.”
The Illinois Policy Institute recently reported that student leaders from across the state are campaigning for a meeting with Gov. Bruce Rauner and other legislative leaders to voice their concerns about the state’s ongoing budget crisis and the heavy toll it's taking on higher education.
Institute researchers cautioned the students to be sure to know what issues they should be most concerned about: namely, the proliferation of an out-of-control pension system and an administrative hiring spree.
“I would imagine most Illinois taxpayers would be upset to know that their money is going to poorly managed public pensions rather than keeping college affordable for students,” Cooper said.
Illinois spends more money on administrative and retirement costs than on university operations, with 50 percent of its $4.1 billion budget for state universities now doled out for retirement costs, the institute said.
At the same time, the number of administrators at state universities swelled by nearly a third between 2004 and 2010.
“Disinvestment has reversed in recent years as the economy picks up and states have more tax revenues to spread around,” Cooper said. “But the ballooning costs of Illinois’ pension program means that it’ll probably be awhile before the state can restore funding lost in the recession.”
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