Oh please. California is an economic powerhouse with world class public universities.
Yep, the top UC’s at those costs are still options that residents of almost any other state would envy.
I’ve lived in CA, and certain people in CA seem to live in their own little world with only a vague conception of what the rest of the country is like.
The University of Michigan and the University of Virginia have pioneered a hybrid public-private model that compensates for declining public funding with a multi-faceted, essentially private financial strategy. A key element is building a large endowment; Michigan’s endowment now stands at about $10 billion, 9th largest of all colleges and universities, public and private, and Virginia’s stands at $6 billion, 18th largest overall (slightly larger than Cornell’s). This doesn’t happen by a stroke of good fortune, and it doesn’t happen overnight; it takes many years of diligent effort. Most public universities are far behind in this regard, mainly because in the past they could always count on legislative appropriations as an easier alternative.
Michigan and Virginia also have high percentages of OOS and international students for public universities, around 35% at Virginia and about 40% at Michigan. Both also charge high OOS tuition, generally at a price point just slightly below the sticker price of elite privates, and neither school has any difficulty filling those seats with highly qualified and in many cases full-pay OOS students because they are (correctly) perceived to be quality institutions. The obvious trade-off is that means fewer seats for state residents, but in my opinion it’s not unreasonable for the universities to calculate that if the legislature won’t fund more in-state seats, their only real options are either to sacrifice educational quality by educating more in-state students with fewer resources, or to provide a higher quality educational experience to a somewhat smaller number of in-state students by admitting more OOS and international students, thereby generating more net tuition revenue (and actually improving the academic credentials of the student body, becuase OOS admissions is highly selective and in-state admissions becomes more selective). Other public institutions are beginning to do this as well, but it will only work for some of them; there are only so many well-qualified OOS students to go around, and they have many choices, and the top publics are competing with the top privates to skim the cream off the top.
Michigan and Virginia also charge somewhat higher in-state tuition than many public institutions, but unlike the vast majority of public institutions, both Michigan and Virginia meet full need for in-state students, so low- and moderate-income students are buffered against high tuition costs. It’s really the in-state full-pays who bear the brunt of (relatively) high in-state tuition, but for most of them, in-state tuition at Michigan or Virginia is still a fabulous bargain relative to full tuition at a private institution or OOS tuition at an out-of-state public. High in-state tuition is a very serious problem if the school can’t or doesn’t meet full need, but if it does meet full need the problem is much diminished.
There are other elements to the strategy as well: high rates of annual giving by alumni, successfully competing for hundreds of millions in external research grants, royalties and licensing fees on intellectual property rights, and so on.
This is a model that won’t work for many, perhaps most public universities, but it can work for some, especially the better ones. I think we’ll see many of the top publics pursuing similar strategies going forward. It’s the second- and third-tier public universities that face the grimmest future, because the path forward for them is much less clear…
BC- thank you for raising the point about competing for external research grants. There are loads of folks on CC who claim (and I think- honestly believe) that prestige is just “marketing”, or having nicer amenities.
The folks at Boeing or Pfizer or IBM who have research grants to award to a university, don’t pick Michigan over U New Hampshire or MIT over Framingham State because they are “prestige-%^&*”. They do it because they have a matrix of needs- faculty capability, lab capacity, the talent stream in the grad programs to put in the hours, track record of success with similar projects, etc.
The best way to increase the “prestige” factor of a university is to actually become better at something- better at faculty recruitment and retention, better providing a launch pad for young scholars, better developing public/private partnerships, or creating strategic alliances between your bio department and a teaching hospital, or between your psych department and a life-sciences consortium studying behavior and brain chemistry.
Fancy brochures and a climbing wall don’t do what BC is describing at Michigan and Virgina.
Good post- BC.
While I don’t deny that the UCs are still good choices for in state resident but OP’s post is the decline in contribution from the state funding to the UCs. Didn’t we just have a negotiation show down from Brown and Janet P. She only agreed to 2 years of no tuition increase. So of course it doesn’t affect my family but other families with younger kids then mine.
A lot of things that worked in the 60s and 70s don’t anymore today. Talk to a blue collar union guy with a manufacturing job about that. Things change; nothing lasts forever.
Public Us can’t sit around (like they did in the good old days) waiting for the truck load of cash to arrive from the state capitol. That model just is not sustainable anymore. Among the high end state flagships, maybe UNC is the only one still somewhat on that antiquated model. That model is never coming back.
The UM UVA model actually works very well. But it is hard to pull off. There’s other models available for less esteemed State Us. In my state CU/Boulder has a model that works pretty well for it. Colorado State has a different model that also works well. Both are very different from how they operated in the past. Both get by on a fraction of the state funding they used to have.
While less selective privates are in danger of shutting down, the State Us are not. They will survive and mostly thrive. But they will be funded and populated different than how they were decades ago. Like just about everything.
@bclintonk - unfortunately, your analysis seems prescient. Top-ranked state universities will have the stature to woo high pay OOS or international students to increase their revenue base. Less talented state residents will get shifted to second and third tier institutions or community colleges. Effectively, more social stratification will take place within the public system with some attaining quasi private status. Arguably, many of the UC campuses are already there and places like Michigan, UICU, and UVA are well on their way.
Tuition increases aren’t that simple. Regents must approve them and they can be under political pressure to keep tuition flat, or nearly so.
Does anybody know how Alabama pays for their program of offering full tuition remission to meritorious OOS students? What % of their student body matriculates under these conditions?
One could also point to the increased costs in higher education that have little to do with delivery of instruction. The expansion of highly paid upper-level administrators that don’t seem to serve any necessary purpose or expensive branding campaigns come to mind. But that’s probably grist for another post.
“In my state CU/Boulder has a model that works pretty well for it. Colorado State has a different model that also works well”
@northwesty what’s CU Boulder’s model? Other than accepting up to 30% out of state students and charging them up the wazoo?
The University of Alabama apparently uses its budget for discounting mainly on those well known scholarships (for both in-state and out-of-state students), since its net price calculator does not seem to indicate any aid other than federal aid for students (even in-state ones) who do not meet the thresholds for those scholarships.
One way the University of Alabama pays for those full-tuition merit scholarships to OOS students is by “gapping” Alabama residents on need-based FA. According to their 2014-15 Common Data Set, they spend more than twice as much in institutional funds on merit aid ($79.8 million) as on need-based aid ($37.6 million). As a result, they meet full need for only 15.5% of their students determined to have need, and on average meet only 49.6% of need for those receiving need-based aid.
But Alabama’s not exactly an outlier here. Most schools that give out substantial merit awards don’t meet full need. It’s a strategic choice. I assume many figure if they don’t have sufficient resources to meet full need, they’re better off using the resources they do have to attract some top students—even if many of those top students come from higher income brackets and/or out-of-state, the latter being a relevant consideration only for a public institution. That seems a harsh policy for a public institution to adopt toward state residents, but Alabama is far from alone in that regard.
Alabama stands out in one crucial respect, however. If they’re meeting roughly half of need by spending $37.6 million in institutional funds, then it seems they’d have ample funds to meet full need if they just took half of the $79.8 million they now spend in merit awards and used it to beef up their need-based FA budget. In short, they can’t hide behind the excuse that they don’t have sufficient funds to meet full need. They have the money, they’re just electing to spend it on merit awards instead of need-based aid, with much of that money going to higher-income OOS families.
“They have the money, they’re just electing to spend it on Merit awards instead of need based aid, with much of that money going to higher income OOS families,” If that is the case, I feel badly for Alabama residents that need aid to go to school.
I think Alabama is trying to improve its student stats by enticing OOS students with merit aid. Perhaps worthwhile if it gives the better instate students a better peer group/experience.
I wonder if Michigan’s strategy has changed Michigan State’s student stats as more instate students may be going there instead of the University of Michigan.
Hopefully Wisconsin can ride out the current governor’s views.
It is great that Alabama is trying to improve its stats, but “gapping” instate kids that need aid seems a shame. But I am not an Alabama resident so have no clue about how the residents might be feeling about any of this.
“In my state CU/Boulder has a model that works pretty well for it. Colorado State has a different model that also works well”
@northwesty what’s CU Boulder’s model? Other than accepting up to 30% out of state students and charging them up the wazoo?"
That is the model.
CU charges a somewhat higher price to in-staters than CSU does. CSU is 80+% in-staters while CU is 50% in-state. CU charges a higher (but not outrageous) OOS price that is attractive to tons of kids from CA and TX who can’t attend UT or UC. It is not perfect and it is different than previous, but it does work. Both CU and CSU have record high enrollments and construction cranes going on campus all the time. CU gets about 4% of its budget from the state. Basically a rounding error. The earth would not shake if it went to zero (which it will eventually).
One thing a lot of State U’s are doing to adapt and compete is get bigger (if they can). Alabama enrolled 24k students in 2006. 37k students in 2015. There has been no decrease in the number of in-state students. They’ve created new seats to sell to OOS-ers. UVA and UM are bigger now than they used to be.
@mamaedefamilia, note that the UC’s have a relatively high percentage of Pell Grant recipients. Thus they don’t seem very stratified.
Well, I’m not so sure about “social stratification” since it’s not necessarily income- or wealth-based, especially if the top publics are meeting full need for state residents, as the UCs, Michigan, Virginia, and UNC-Chapel Hill all do. It is a meritocratic stratification, to be sure, but that has been true since the beginning of time in many of these states. Way back when I matriculated at the University of Michigan in the early 1970s, it was just generally understood that only the top handful of students were going to be admitted to the University of Michigan; the rest just didn’t bother to apply. But the state had some perfectly adequate alternatives, like Michigan State, Michigan Tech, and a large number of “directional” state colleges and universities. It was always these other schools that educated most of the state’s residents; nothing new there. The University of Michigan educated the state’s educational elite, nothing new there, either. And the University of Michigan’s undergraduate student body has actually grown by about 50% since my day, which happened to be about the peak of the baby boom. So while OOS and international students now make up a larger fractional share of the student body, my guess is in absolute numbers the university still educates as many if not more Michigan residents than it did in my day, and probably a higher percentage of its college-age population.
Due to changing demographics, primarily an aging population and slow population growth, the number of graduates of Michigan high schools is actually declining year by year. That means a steady decline in in-state applications to the University of Michigan, and it means the University can gradually increase the OOS presence in the student body without much actual “shifting” of state residents to less selective schools. It’s true that admission standard have risen over time, but a lot of this is just self-selection. Back in my day a significant share of the state’s top students chose Michigan State, though not as many as chose Michigan. That’s still true to some extent, but the gap between Michigan and Michigan State has grown, largely because given a choice, more of the state’s top students now choose Michigan. That’s consistent with broader trends in higher education, a “flight to quality” among those who have what it takes to get there. That’s why elite privates get many times the number of applications they once did, and it’s why Michigan this year got 40,000 OOS applications, compared to just 10,000 in-state. Meritocratic stratification isn’t entirely the schools’ doing; to some extent it’s just what top students want.
Well, the reality is that UVa at least, has many higher income students, despite more recent initiatives to attract and fund lower income students. Many Virginia top students and their families have an interest in our state schools . UVa, like Michigan, also has many more OOS applicants than IS. Most of that is self selection. Guidance counselors and the kids themselves in Virginia have an idea of who is competitive. UVa has always had a decent number of OOS students (about 30 %) and they also seem to be responding to pressure from instate residents to accept more instate kids by adding more seats. There seem to be complaints from instate residents that end up every year in the newspapers about how the 1400 +, 4.0 + type didn’t get in.
@bclintonk and @PurpleTitan You raise good points and I fear I did not express myself clearly. What I was thinking is more of a meritocratic stratification than a socioeconomic one, although obviously the two are linked. I found your case of Michigan to be an interesting one; in the face of demographic decline, admitting meritorious OOS students effectively solves two problems - how to maintain enrollments and how to bring in more money to adapt to reduced public funding.
I live in a poor western state where the flagship Research I university serves a student population that overall is poorly prepared with mediocre stats. Their 4 and 6 year graduation rates are dismal. Yet some of those kids seize the opportunity to get a quality education and thrive. If the university were to make a concerted effort to attract OOS students to increase its revenue stream, those in-state students would not have the same opportunities.
Virginia has no problem maintaining instate Virginia enrollments. Many kids are trying very hard to maintain top grades and scores and EC’s to get into college- particularly UVa, Wm & M and Virginia Tech. I am surprised to hear that the University of Michigan would have to react to any instate “demographic decline” as it seems it would remain a top destination for many instate Michigan kids? With the more recent middle class financial initiatives by many private schools, more instate kids are probably trying to get into those private, top schools, but I would think that top publics are still quite attractive to many people.
Can anyone name one state flagship or major state university that isn’t stronger now that funding has decrease than it was when the state was paying a much bigger portion of the bills? I really can’t think of one that is in worse condition or viewed as less prestigious than it was in say 1975 or 1990. It is becoming much harder to get into most public schools now than it was in the old days when you just needed a high school transcript and tuition money to get accepted to your state school.