Public colleges and universities are supposed to be affordable options for students seeking a degree, but years of state budget cuts have led to increased tuition that families are struggling to afford. If states continue down this path of disinvestment, some will soon contribute nothing to higher education and leave schools and parents to fend for themselves, according to a series of new reports.
State funding for higher education historically rises and falls with the economy, but six years out of the 2008 recession the money states set aside for each college student remains 27 percent below what it was before the economy tanked, according to a new paper from liberal think tank Demos.
Fewer state dollars has meant higher tuition to offset the loss of funding. Tuition at public four-year colleges has risen by nearly $3,000 on average in the past decade. Demos estimates that declining state support is responsible for nearly 80 percent of increased tuition at state schools from 2001 to 2011.
There has been a seismic shift in the way public colleges are funded. Tuition made up a quarter of the total education revenue at state universities in 1989, according to the State Higher Education Executive Officers Association. By last year, those dollars accounted for 47.1 percent of the money schools need to educate students.
"In the aggregate, we almost don't have public education anymore now that tuition is contributing more than half of all revenue. Really we have subsidized private education," said Robert Hiltonsmith, a senior policy analyst at Demos and the author of the report.
Another recent report from the Pell Institute for the Study of Opportunity in Higher Education put the disinvestment trends into sharper focus. Researchers at the organization project that if the current trend of paltry state investment were to continue, several states, including Colorado, Louisiana, Arizona and South Carolina, will contribute nothing to higher education in the next 10 years.
The organization looked at state appropriation trends from 1961 to 2015, noting that since the 1980s funding has waned during periods of economic recession and never fully recovered. By 2015 the annual state investment in higher education was about 55 percent of what it had been in 1980.
It's entirely likely that trends could change. But in the past few months, states have proposed or enacted some major cuts to higher education.
Not only did Arizona slash $75 million in spending for its state universities, the legislature also agreed to completely eliminate funding for community colleges to reduce the state's budget deficit.
Meanwhile, Wisconsin Gov. Scott Walker wants to cut $300 million over the next two years from the state's universities to plug a $2 billion deficit. If approved, the 13 percent cut would be the deepest in the history of the state's higher education.
Another presidential hopeful, Louisiana Gov. Bobby Jindal, is calling for the elimination of more than 80 percent, or up to $600 million, in funding for the state's higher education system. While he says the cuts are needed to reduce a $1.6 billion budget deficit, critics point out that he has not touched an entertainment-tax credit program that costs the state as much as $250 million a year.
"A lot of the deficits exist because governors cut taxes and didn't raise them after the recession, so we're still left with residual budget issues," said Hiltonsmith of Demos. "Or they cut taxes so low that they can't support the programs the state has committed to funding."
Public universities have grown more reliant on tuition dollars in the wake of the 2008 economic recession. The downturn hurt state budgets and legislatures responded by cutting higher education funding.
At the same time, there was an influx of people enrolling in school, placing added pressure on already stretched school budgets. The federal government stepped in with increased grant aid for students, but the money has failed to keep pace with the cost of college.
Even if states were to return to pre-recession level investment in higher education, some argue that greater funding will not bring costs down. The cost of delivering education is often more than what families pay to send their kids to college, said Andrew Kelly, director of the Center on Higher Education Reform at the American Enterprise Institute, a conservative think tank.
"Simply providing more state money doesn't put pressure on institutions to lower their cost of delivery," Kelly said. He argues that universities could do more to cut expenses to keep costs down.
But many schools have already cut faculty and staff to keep tuition down, and many others have fixed healthcare costs that place pressure on their budgets. Without more state support, student advocates say schools will be forced to continue to raise prices.