Almost every day, we hear horror stories of students who have dropped out of college because they could no longer afford the cost. In mid-February of this year, students at the University of Colorado dressed in black and held a mock funeral for higher education. Several held signs with how much they owed in bright red. One student interviewed on television owed $50,000.
It is not uncommon for private universities to cost $50,000 or more, most of it just for tuition. Many public universities cost $40,000 for out-of-state students and $30,000 or more for in-state, most of this too represents tuition and fees. Add in books and the cost of living on campus and public higher education is becoming unaffordable to a growing number of Americans.
Six-of-ten students who graduate from public four-year colleges in the U.S. leave college with a combined debt (loans and credit cards) of $20,000 or more. If they go to graduate school, it is common to leave with debts of $50,000-75,000 or more.
And, the recession has made it worse. As the budget crunch has forced states to cut funding to public universities, resulting in higher tuition rates. States can't afford to continue to fund higher education institutions at the rate they did a few years ago, let alone a few decades ago.
In the University of Houston system state support has gone from 60% of total revenues 20 years ago to barely 25% today. Monies from tuition and fees now account for 60% of those revenues!
While financial aid has grown in absolute numbers, most financial aid (approximately 70% nationally) is in the form of loans. So, student indebtedness has grown and is compounded by the growing use of credit cards, as college students increasingly rely on credit cards to pay for books, food, clothing, and other expenses.
A recent report by Public Agenda and the National Institute for Public Policy and Higher Education, Squeeze Play 2010, found a drop in public trust of higher education. In 2007, 43% of those interviewed felt that colleges care about education and providing a quality educational experience for students. In 2010, that number had dropped to only 32% of respondents. Equally bad, in 2007, 52% of respondents felt that colleges were more like businesses and mainly care about the bottom line, today that number has grown to 60% of those surveyed.
Perhaps even worse, the report discusses what they term a 'misery index.' In 2000, 45% of those surveyed felt that the vast majority of qualified and motivated students have the opportunity to attend college. Today, that number has dropped to 28% of those surveyed. In the same ten year period, the number of people who felt that a college education is necessary for success in today's work world rose from 31% to 55%.
So, more people believe college is essential, but a huge portion feel that college is no longer affordable and that many qualified student will be unable to attend college. There is good reason to be concerned. According to a 2009 report by the State Higher Education Executive Officers (SHEEO), from 1970 to 2005, CPI-adjusted tuition and fees at 4-year public universities rose 177% (although net revenue rose only 140%).
Between 2005 and 2010, tuition and fees at public universities grew by twice the rate of inflation. According to the National Center for Public Policy and Higher Education, between 1982 and 2007, family income only rose by 147%, the CPI rose by 106%, yet tuition shot-up by 439%. In the same period, the percentage of household income needed to send a child to college rose from 20% to 28%.
Meanwhile, the amount of total college costs covered by scholarships and grants declined. Pell Grants covered 52% of the cost of college (tuition, fees, book, and room and board) for qualifying freshmen in 1987-88, but only 32% in 2009. During the same period, the percentage represented by student loans doubled. State aid also declined relative to the rising cost of tuition. Between 2001-02 and 2006-07, average state financial aid grew by 28% from $480 to $613, but average state tuition rose from just over $3700 to nearly $6,000 (a rise of 54%).
Moreover, states are reducing need-based aid, while increasing the portion of merit-based aid or, as in Texas, pairing need with merit. In 1987-88 only 17% of state-aid was merit-based, today that percentage has increased to 28% of all state-based financial aid. Financial aid is diminishing relative to cost precisely at a time when more Americans need college degrees and more students are Hispanic, first-generation, and from poor and working class families.
There are no easy answers. State appropriations are being drastically cut. Most states survived the recession with deep cuts and by using stimulus dollars to fill big holes in the budget. The picture will get worse in 2012 when stimulus dollars disappear. So, universities raise tuition, and students are forced to work more hours and take more loans to obtain a college degree.
Even so, America must confront the reality that higher education is becoming unaffordable to a large portion of Americans. We cannot turn our backs on working class and middle class Americans. America grew strong after World War II because of the GI Bill. Many veterans, including my father, earned their high school diploma and many went to college, because of the GI Bill. To keep America strong, we must have more Americans obtain college degrees and we must make the path to college affordable.
Similarly, universities must commit to keeping down the costs of higher education and to increasing need-based scholarships. States and the federal government must find ways to increase Pell Grants, and other need-based financial aid.
Next year, tuition and fees at the University of Houston-Downtown will increase by $113 for students taking 12 hours. The tuition and fee increases will be used to promote student success, so that we can increase need-based scholarships, hire more faculty and staff (particularly those in student services), and maintain or expand programs that support students (such as supplemental instruction and mentoring programs).
No one wants to raise tuition, particularly at UHD, where we serve mainly working class and first-generation college students. Nearly 90% of our students are eligible for some form of financial aid. Our student body is 37% Hispanic and 28% African American and the vast majority come from households earning less than $40,000.
Like every public university in Texas, UHD also had to make state-mandated cuts of 5% for both FY2010 and FY2011. Still, we are committed to keeping UHD affordable and to promoting student success. UHD remains one of the most affordable four-year public universities in Texas. UHD is one of the best values in higher education. It provides a high-quality education at a low cost. And, we intend to keep it that way. But, even more importantly, we pledge to make it an institution known for both opportunity and student success.