Study says tuition supports public universities more than state

While a new national report found that tuition revenue now accounts for more public university funding than state support, North Carolina has not followed the same trend.

The report, published by the U.S. Government Accountability Office, found that between fiscal year 2003 and fiscal year 2012, median tuition at public universities across the country increased by 55 percent while state funding for public higher education decreased 12 percent.

Melissa Emrey-Arras, director of education, workforce and income security in the Government Accountability Office, said state funding used to make up more of schools’ revenue than students’ tuition money.

“Family incomes have leveled off in recent years and college prices have been going up, which just really squeezes a lot of families and makes it difficult to go to college,” she said.

In 2014, the UNC system received $2.6 billion in revenue from the state and $1.35 billion from tuition, said Michael Vollmer, associate vice president for finance of the UNC system. While tuition revenue from in-state and out-of-state students has gone up 53 percent and 40 percent, respectively, in the last five years, he said state revenue has remained fairly constant.

“(State funding) is not what it was 20 years ago, but it’s still a very significant amount,” Vollmer said.

Matt Ellinwood, education policy analyst at the N.C. Justice Center, said North Carolina’s commitment to public higher education stands out from other states, but has diminished since the Great Recession.

“We are seeing a lot less state money and a smaller percentage of the overall state’s budget going into the UNC system than we used to,” Ellinwood said. “So it’s a dwindling commitment to an affordable system of higher education.”

Jenna Ashley Robinson, director of outreach at the right-leaning Pope Center, said if universities rely too heavily on state funds then schools might not be sensitive to costs.

“You can just start spending money on things that aren’t really priorities,” she said.

Robinson said that while North Carolina is not one of the states that relies more on tuition revenue than state subsidies, schools could still increase affordability by keeping administrative costs down and consolidating functions across the system.

The report lists some policies that help maintain affordability, including limiting tuition increases or freezing tuition, encouraging students to graduate on time and discouraging students from taking more classes than they need.

Most federal higher education support, about $136 billion in 2013, is spent on financial aid — which goes directly to students — rather than programs that could incentivize states to improve college affordability.

“The government could decide to increase Pell Grant money for students that go to public schools in states that invest in higher education at a higher amount,” Emrey-Arras said.

Ellinwood said on the state level, the lottery system, in which a portion of revenues go to education, should be altered to provide more money for need-based scholarships.

He said tuition increases might mean fewer students will be motivated to attend college.

“That’s a really scary concept in a time where a college degree is becoming really important,” he said. “It’s a very dangerous thing to start putting it out of reach for large numbers of people in our state.”

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