SHEEO Professional Development
August 15, 2002
Balancing Affordability and Access:
Challenges and Opportunities
in Virginia
Nancy Cooley
Academic Affairs Director
STATE COUNCIL OF HIGHER EDUCATION FOR VIRGINIA
ADVANCING VIRGINA THROUGH HIGHER EDUCATION
Mounting Pressures
• Virginia’s circumstances mirror
those of most other states
- Declining state general fund revenue
- Increasing tuition and fees
- Growing enrollments
Differing Perspectives

Student/Parent: How much does/will it cost to attend
college? How do we plan and save for college? How do we
minimize the need for debt?

Institution: What sources of revenue are available as we
develop/implement our strategic plan? How do we attract and
retain students? How do we provide access?

State: What is state’s role in supporting pubic higher
education? What is the appropriate “share of cost?” How do
we plan for future investments in higher education?
Putting the Pieces Together
Student Share
State Share
Student Share
State Share
Financial
Aid
Policy Pendulum

Tuition Policies
–
–
–
–
–
–
1990 - 1994: Tuition and fees set independently by
institutional boards. Tuition and mandatory E&G fees
increased by 50%, on average, statewide in four years
1994 – 1996: Governor and General Assembly cap tuition
increases at 3% annually.
1996 – 1999: State policymakers “freeze” tuition
2000: Governor requires institutions to “rollback” tuition
20% replacing tuition revenue with general fund support.
2000-2002: State-mandated tuition freeze continued.
2002-2004: Tuition setting authority returned to
institutional boards.
Policy Pendulum

Student/State Share of Cost
–
1976 – 1990: Explicit policy that students should
cover a standard percentage of the cost of their
education




–
In-state undergrads at 4-year institutions paid
25% of “cost,” with “cost” varying by institution
based on mission
In-state community college students paid 20%
Out-of-state students paid 75% of cost
State paid remaining shares
Policy abandoned during 1990s; reinstated as a
“goal” in 2001.
Policy Pendulum

Student Financial Aid
–
–
–
–
–
High tuition/high aid philosophy
Few explicit policies dictating appropriate levels of student
aid until mid 1990s
1996 - 2000: SCHEV recommended that the state provide
enough support to meet 50% of student “remaining need”
State funding directed almost exclusively to support needbased aid for in-state, undergraduates.
2001: SCHEV recommended that the state focus
additional appropriations on most financially needy
students rather than meeting 50% of remaining need for all
students
VA’s Current Policies

Student Financial Aid
–
–

SCHEV’s 2001 policy requires all students to assume a
greater level of “self-help” with the intention of directing
limited state funds to most financially needy
Policymakers have been slow to embrace because of
perception that the new model encourages “student debt”
Student/State Share
–
25% goal reinstated for in-state, undergrads at four-year
institutions; 20% at community colleges
VA’s Current Policies

Tuition Policy –
–
–
–
–
The “Kitchen Sink” Approach
Authority returned to institutional boards with strong
recommendation from the state not to exceed 9%
annual increase (cap not binding)
Proportion of out-of-state students not increase at
institutions currently with >= 25% out-of-state
students
Boards also encouraged to look at a variety of
factors when setting policy, including:
VA’s Current Policies

Tuition Policy (con’t) –
–
–
–
–
–
–
Consumer Price Index
In-state tuition charges at public peer institutions
Ability to maximize resources through tuition increases on
out-of-state students and graduate students
Capital costs not captured in the standard calculation of
“cost of education”
Options that would require a portion of additional tuition
revenue be set aside for institutional student aid
Impact of tuition increases on access and quality of
applicant pool
Current Environment
• Explicit/implicit goals:
–
–
–
–
–
Make a college education affordable for in-state,
undergraduate students
Promote access for in-state, undergraduate
students (Limit access to out-of-state students)
Limit student share of cost
Limit student debt burden
Ensure higher education is accountable for
investment of public funds
Affordable education?
• By most indicators, a public college
education is more affordable for most
Virginia families now than it was a
decade ago.
Affordable education?
1993-94
State and Student Share of the Cost of
In-State Undergraduate Education
2002-03
State and Student Share of the Cost of
In-state Undergraduate Education
Student
Share
26%
Student
Share
38%
State
Share
62%
Student Share
State Share
Average cost of education = $5,850 in actual dollars or $7,327
in constant 2003 dollars.
State
Share
74%
Student Share
State Share
Average cost of education in 2003 dollars = $7,941.
Affordable education?
Tuition and Fees
Rank Among All States1
1989-90
1993-94
2000-01
2001-02
Estimated
2002-03
Major Public Universities
8th
5th
18th
18th
18th
University of Virginia
Public Colleges and State Universities
2nd
2nd
11th
12th
12th
George Mason University
Old Dominion University
James Madison University
Longwood University
Radford University
Public Community Colleges
28th
19th
41st
43rd
43rd
(1)
Based on a survey conducted by the Washington State Higher Education Coordinating Board. Although not all public institutions are included in this survey, the averages and changes
over time at the same set of institutions offer consistency, and the large number of institutions included provides a close approximation to state averages.
Affordable education?
Average Public 4-Year Total Undergraduate Cost as a
Percent of Per Capita Disposable Income
43.0%
41.0%
39.0%
38.6%
37.0%
35.0%
Virginia
40.1% 40.3%
39.4%
38.4%
36.6%
34.4%
37.3%
35.3%
31.0%
30.6%
33.3%
33.8%
33.0%
32.6%
32.3%
32.9%
32.4% 32.6%
31.6% 32.1%
National
30.2%
29.0%
34.3%
34.6%
33.0%
27.0%
40.0%
28.4%
28.2%
25.0%
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
Current Pressures


At least 32,000 additional students expected in the
next decade (10% growth between 1990 and 2000)
Declining state revenues
–
–
–

Average 3% general fund reduction to institutions' base
E&G budgets in FY02; 9% for FY03; 12% for FY04
Additional cuts expected
Higher education share of state budget at lowest point in a
decade.
Disparate financial aid policies
Current Pressures
•
Public “memory” and/or “attention span” often
reaches only a few years. Students and their
families are impacted for a relatively short time.
•
Virginia’s governor serves only one term (only
state in the nation) and other policymakers
often driven by 2-4 year terms.
•
As a result, the only comparison of interest is
the one of today. Long-term strategies tend to
be less meaningful.
Realigning the Pieces
• How do we define “affordable”?
• Affordable for whom?
• Access at what level?
Realigning the Pieces
• SCHEV Affordability Study
- Evaluate proposed changes to student
-
financial aid allocations using student
level data
Establish options for identifying a longterm tuition policy for the
Commonwealth
Develop a methodology for determining
the appropriate state share of cost
Realigning the Pieces

Systemwide Strategic Plan
–
–
–
Quality and Access Working Group
Input from 18 regional focus groups and
SCHEV constituent groups
Leadership from top-level Strategic Plan
Advisory Committee
Governor’s Higher Ed Summit

Planning and Capacity Committee
–
–
–
Enrollment issues
Program and site duplication
Patchwork quilt approach
“Selling” the Story

Why this issue is important?
–
Students/Families - Ability to plan and save for a college
education
–
State Policymakers – Ability to plan and invest in higher
education and student financial aid
–
Institutions – Ability to carry out long-term planning based
on predictable sources of funding
STATE COUNCIL OF HIGHER EDUCATION FOR VIRGINIA
ADVANCING VIRGINA THROUGH HIGH
ER EDUCATION
SCHEV
James Monroe Building
101 North Fourteenth Street
Richmond, Virginia 23219
Tel:
Fax:
TDD:
Web:
(804) 225–2600
(804) 225–2604
(804) 371–8017
www.schev.edu