In The New York Times, Tamar Lewin writes about how tuition payments are exceeding state appropriations, and some of the possible consequences foreseen by higher education professionals. Examples in this article focus on California and South Caroline.

Scott Pattison, executive director of the National Association of State Budget Officers:

“The difference between this downturn and others in the past is that this time I don’t think higher education will be able to recover the ground it’s lost,” said Scott Pattison, executive director of the National Association of State Budget Officers. “I hope I’m wrong, but I don’t see that money coming back. And with tuition already out of reach for many folks, I don’t think there’s much ability to keep raising it.”

Mark Yudoff, president of the University of California system:

“If approved, this budget will mean that for the first time in our long history, tuition paid by University of California students and their families will exceed the state’s contribution to the core fund,” Mark Yudof, the president of the University of California system, told the Board of Regents. “For those who believe what we provide is a public good, not a private one, this is a sad threshold to cross.”

Subtitled, "Considerations beyond the institution’s competitive market position," this article from University Business magazine looks at a number of important considerations to be made when planning to raise or lower tuition, and in communicating such changes to students and their families. It includes links to useful resources, data sources, and calculators.

Whatever the institution’s sticker price, messages about affordability need to be sent early and often to prospective students and their parents. Even at low-cost institutions, some portion of the prospect pool will find the charge above their means, so this advice applies to both public and private institutions. And although every institution will soon offer a net price calculator, most calculators will require families to provide an extensive amount of information to get the estimate.

Consequently, it is not clear how many families will actually be willing to go through the process for every institution they are considering. Offering simple messages (e.g., an income profile of the class showing that students from all backgrounds attend or scholarship programs with clear eligibility criteria and award amounts) to encourage families to complete the aid application process will still be important.

Daniel F. Sullivan, president of St. Lawrence University, looks for the hidden costs of low retention rates, from the student perspective. He notes that four years of attendance at a public institution costs less than at a private institution -... however, given the higher risks of not graduating in 4 years at the public institution, the eventual overall costs might really be closer or even favor private colleges.

In this time of special financial stress for so many American families, the cost of college attendance may seem especially daunting. Prospective students and their families should, therefore, consider the implications of this analysis as they weigh the differences between public and private higher education options—and between high-four-year-graduation-rate and low-four-year-graduation-rate options, whether public or private. It is clear from all the scenarios presented in figure 1 that if a student manages to graduate in four years from a public institution, the total cost of attendance will be lower than at a private institution. On the other hand, the risk of not graduating in four years is much higher at a public institution. In the event that a student attending a public institution does not graduate in four years, but could have done so by attending a private institution, the cost savings of the public choice remain only if the student is non-aided and attending an in-state public institution.

To return to where I began, the single most important step colleges and universities—especially public colleges and universities—can take to lower the student and family cost of college attendance is to improve retention, thereby increasing the four-year graduation rate. With the exception of the rates for highly selective institutions (and these can be higher, with work, as well), the four-year graduation rates of both public and private colleges and universities in America are embarrassingly low.

Understanding the Costs of Public Higher Education by Peter McPherson and David Shulenburger

"In the case of higher education costs, diametrically opposed views have persisted over time. Why?"

Paul T. Brinkman and Anthony W. Morgan. 2010. Financial Planning: Strategies and Lessons Learned. Planning for Higher Education. 38(3): 5–14. 

This article is part of a themed issue of SCUP's journal, Planning for Higher Education, focusing on Issues in Higher Education Finance. Click, above, on the journal image to go to this issue's full table of contents or on the article title to go to this specific article.

Abstract - "This article explains the cost of education in public research universities. 'Price,' meaning 'tuition,' is often incorrectly substituted for 'cost,' meaning expenditures by the university that make the education possible. University cost is disaggregated to enable readers to distinguish between the costs associated with providing education to students and the costs of other non-educational activities that tend to produce their own revenue. While tuition has increased rapidly, real cost per student for providing education has been roughly constant for nearly 20 years. Increased revenue from tuition has been almost precisely offset by reduced revenue from state appropriations."

SCUP members were sent a printed copy of this issue, can read the full article on line, and can download a PDF at no additional charge. Nonmembers can purchase a PDF of this article here.