College & Workforce Readiness

Tuition Revenue Keeps Public Colleges Afloat as State Support Lags

By Caralee J. Adams — April 13, 2015 1 min read
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A new report out Monday shows as state support for higher education wanes, colleges are turning to families to make up the difference.

For the third year in a row, tuition makes up nearly half of all revenues (47.1 percent) for public colleges and universities, according to the State Education Executive Officer association. Dial back to before the recession and SHEEO reports tuition accounted for about 36 percent of a college’s income and in 1989 it was just 25 percent.

As students headed off to college in 2014, families paid about 2.7 percent more in tuition than the year before, 26.7 percent more than five years ago, and 107 percent more compared to 25 years ago when adjusted for inflation.

States vary widely in the percent of educational revenue supported by net tuition, from a low of 15.1 percent in Wyoming to a high of 84.5 percent in Vermont, according to the report.

There are also fewer students enrolling to spread out the costs.

After peaking in 2011, enrollment at public colleges and universities has declined slightly for the past three years. SHEEO reports that the 11.1 million full-time students attending public postsecondary institutions in 2014 was a drop of about 1.3 percent from the previous year.

While the report showed a boost in spending by local and state governments in higher education of 5.4 percent from 2013 to 2014, public investment is down 13.3 percent compared to five years ago and 24 percent compared to 25 years ago.

Another report out last month from National Center for Education Statistics analyzed the bottom-line cost that families pay for higher education. “What is the Price of College?” shows how financial aid and discounting means that families rarely pay the published price for tuition, but how much less varies considerably by the type of institution.

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A version of this news article first appeared in the College Bound blog.