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<p>No, when the state is only contributing 7% of the university’s budget, as at UVA, or 6%, as at Michigan, in-staters are most definitely not subsidizing out-of-staters. What’s happening is that the university is subsidizing both in-state and out-of-state students out of endowment payouts, money recaptured from externally generated research grants, intellectual property licensing fees, and other revenue streams. It’s just that the subsidy to in-state residents is much larger than the subsidy to out-of-state students. A portion of that much larger in-state subsidy is recouped from legislative appropriations, but only a portion. If I recall correctly, for every dollar Virginia taxpayers invest in the University of Virginia, they get roughly two dollars in tuition discounts for Virginia residents attending the university. The money is all commingled, of course, but bottom line, Virginia residents are getting a fabulous deal and have no cause for complaint about “subsidizing” out-of-state students.</p>