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State Funding for Higher Ed. Drops by 7.6 Percent in a Year

More students than ever are headed to college, but the funds to support them are not following.

Total state fiscal support for higher education nationwide declined by 7.6 percent from fiscal year 2011 to FY2012, according to the annual Grapevine survey from the Center for the Study of Education Policy at Illinois State University, a joint project with State Higher Education Executive Officers (SHEEO).

Losing $6 billion translated into fewer course offerings and larger class sizes for students. State universities also used more adjunct faculty, froze hiring, and merged academic departments.

The cuts occurred in 41 states, ranging from 1 percent in North Carolina and Indiana to 41 percent in New Hampshire. Arizona, Wisconsin, and Louisiana all had funding drop by 20 percent or more. (Click here for individual state information.)

The reason: the slow economic recovery and the end of federal stimulus money.

By looking only at state funding, without factoring in the expiration of money from the 2009 American Recovery and Reinvestment Act (ARRA), the decline from FY11 to FY12 was 4.1 percent.

In a commentary by Paul Lingenfelter, president of SHEEO, said that educators were worried about educational funding falling off a "cliff" when federal funding was no longer available. "From this year's Grapevine survey of FY2012 appropriations, we now know how steep that fall turned out to be for higher education," he wrote."The federal stimulus funds, provided to cushion the effects of the recession, were helpful in 2009, 2010, and 2011, but they were virtually depleted by 2012."

Only nine states managed an increase in funding in 2012 after considering the loss of stimulus funds. Ten more states increased appropriations from state funds, but not enough to replace the lost federal funding, writes Lingenfelter.

How states will cope with less money varies.

"Those with the largest percentage declines in state support will experience the greatest upward pressure on tuition rates and on recruiting out-of-state students for revenue stabilization," writes Lingenfelter. "More worrying, however, is the potential loss of access for students with significant financial need as state support for financial aid also declines. Such loss of access and change in resident-nonresident mix will have implications for the availability of an adequately educated workforce in those states."

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