<p>"State colleges and universities, battered by declining endowments and state funding cutbacks, are facing a new and potentially far more troubling financial challenge. Out-of-state students, who pay a huge tuition premium to attend, are doing something no one ever thought they would: They're staying home.</p>
<p>Hammered by the recession, they're opting in larger numbers to attend schools in their home states. In a recent study conducted by the College Board and Art & Science Group, a consultant to colleges and universities, 41 percent of high school seniors said they are giving much more consideration to attending a public institutions close to home in the fall because of current economic conditions. And many schools, including the University of Delaware and Ball State, are already reporting declines in out-of-state applications of as much as 40 percent, while in-state applications are up from 5 percent to 10 percent....</p>
<p>Over the past few decades, the financial structure of public universities has changed drastically. No longer does state funding account for the majority of a school's budget. In fact, a school is lucky if state support accounts for 20 percent of the overall budget....</p>
<p>To make up the difference, public universities must rely on tuition and fees to pay for the lion's share of budgetary needs. Because of this, many state schools work hard to attract nonresidents, who pay a premiumÂoften more than three times as much as residentsÂto attend.</p>
<p>I can see why this is happening. For our last one, his total cost to his private options after merit aid were about what it would cost for him to go to out of state publics. Where he would get the real savings was to go instate as they did offer both low sticker prices and some merit money. So the out of state public came in last place for preference because it just was not a good deal for him. I see the same situation for my next one.</p>
<p>This is one of those conundrums where something has to break. Because of State funding cuts, the demand for out-of-state students, to help bridge budget shortfalls, has risen sharply. Meanwhile, the supply of out-of-state students is down sharply as applications are down and yields are down as well.</p>
<p>When demand and supply get out of whack with one another, something has to give. While no school will publically admit to it, it doesnât take a rocket scientist to figure out what will happen. Let us just say that holistic admission standards and the need for greater diversity will take on a new meaning at the publics. </p>
<p>On a related note, I somehow find it hard to believe that everything is as rosy at Vermont as the article portrays. Why wouldnât Vermont, which has among the highest out-of-state tuition rates, not have the same problems with yields and applications that UD, UMCP, Boulder, Arizona, U of Miami, etc. are having?</p>
<p>I see the conundrum exacerbating for the 2009-2010 admissions cycle. This yearâs economic collapse came in the middle of the admissions cycle and people had less time to react. With more time to plan, I see students turning home to an even greater degree. Colleges got a slight reprieve with stimulus money that wonât be there next year. The echo boom peak is over, further diminishing supply. I see many signs that the publics are doing things to recuit OOS like they have never done before. It is a matter of financial survival.</p>
<p>^U of Miami is not a public school, you must mean Miami University (OH)</p>
<p>btw, I am going to an out-of-state public school next year. However, it is very aggrevating because tuition has not been determined yet. This year the state of South Carolina has been especially late at determining their state budget because of the economic crisis. I am hoping that the tuition costs does not increase more than 7% or else it may be very hard to afford the school.</p>
<p>The universities would be wise to follow some wisdom from the world of retail: Itâs better to sell at a reduced amount than to sell none at all. Put something on sale and at least you make some money, or lose less, than if the product just sits on the shelf. If they want more OOS then they should reduce the tuition accordingly. Put the school on sale so to speak. Charge more than In-state but reduce the OOS tuition so that OOs students would be more likely to attend, therefore, more money for the school.</p>
<p>pierre0913: Good catch! I meant Miami of Ohio.</p>
<p>It would appear the colleges have two options to solve this problem: Reduce Prices or Reduce Selectivity for OOS. Reducing prices actually hurts revenues as enrolled students will end up paying less. My sense is that selectivity will take the hit and already did so in 2009. If 40% less OOS applied to UD and they make up a critical percentage of overall operating revenues, what do you think happened to selectivity? You just wonât hear any adcoms coming out and saying selectivity went down for OOS as thatâs not the type of information that wins favor with taxpayers. Here is what the economy did to selectivity:</p>
<p>Top Tier Publics and LACâs: Little Impact
Second and Third Tier Publics In-state: Higher Selectivity, e.g. The Honors College at UMASS was harder to get into than Boston College
Second and Third Tier Publics OOS: Lower Selectivity
Second and Third Tier LACâs: Lower Selectivity</p>
<p>Look for the above trends to be even more pronounced in 2009-2010.</p>
<p>States are raising tuition to provide more financial aid. They believe that higher-income students in-state or out-of-state will pay more for public education.</p>
<p>I would think that it would be smart for these OOS State Schools should lower their OOS price because having a student pay for a reduced price is much better than having no students willing to pay at all.</p>
<p>Some universities lower OOS tuition for merit award - they cut the oos difference in increments to giving the full difference to match in-state tuition. University of Minnesota/Twin Cities and UGA are two that do this. I believe UIUC does something like this as well.</p>
<p>Arizona State also does this. Iâll be interested to see whether Barrett Honors Collegeâs entering class declines because of fewer OOS students. My guess is that it wonât change very much, because ASU is already very competitively priced, especially when compared to colleges in California and the Midwest.</p>
<p>I donât know why anyone would be surprised that OOS applications declined. On the very front page of their website they banner: âDelaware firstâ, announcing a policy that instate will be given preference. </p>
<p>We know when we are not welcome - we dropped UD from the application list.</p>
<p>I found this thread especially appealing because the fact is that more students want to leave their home state for school.</p>
<p>Financially I am happy to admit that my family has done decently with the recession. Both parents work for the government. </p>
<p>However I have never knwon why some state universities are so secective with in staters vs OOS. like penn state. or the opposite like university of florida.</p>
<p>Iâm just curious if the trends are going to change, which brings me to my question.</p>
<p>Will it be easier for me to get into a much more selective school if I am willing to pay the out of state fee?</p>
<p>Iâm not sure why you are surprised and why if the school fit in other aspects why you would drop it. Itâs a state school. It should support its own students first. As a taxpayer, I expect my state schools to give preference to instate students. State schools need the $$ that OOS bring but they need to serve their students (and taxpayer parents) whether or not they make it obvious.</p>
<p>If state schools were mostly state taxpayer funded, I would agree billsbillsbills, but theyâre not. At the most, states fund their public universities at only ~20%. In-state tuition should be more. OOS tuition should be less. In-staters are paying artificially reduced amounts because the âprofitsâ state schools make on grossly overcharging OOS students, NOT the state taxpayers, subsidize in-state studentsâ education costs.</p>