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Picking up the Pieces in Illinois

Richard J. Helldobler doesn’t think any university leader could have been ready to go through the last two years in Illinois, when the state’s public institutions withered under severe funding restrictions due to a prolonged state budget standoff.

Institutions had to make do with stopgap funding that came from the state in fits and starts. When the state didn’t approve funding for its large student aid program, the Monetary Award Program, known as MAP, institutions had to decide whether to credit student accounts anyway. Then they had to find ways to bolster their cash flow to make up for MAP funding until it arrived.

“Nothing in your training prepares you to deal with this kind of catastrophic funding loss,” said Helldobler, since last summer the interim president of the 9,500-student Northeastern Illinois University in Chicago. “What you do is you roll up your sleeves and try to do the next best thing.”

For Northeastern Illinois — and many of the state’s other institutions — that meant deep, painful cuts. In May of this year, the 1,200-employee Northeastern Illinois announced 180 job cuts that did not affect faculty. They followed the elimination of 65 noninstructional positions in 2015. The university has also furloughed employees, frozen hiring and delayed maintenance. It closed and canceled classes for several days this spring. It eliminated hundreds of student jobs.

So it is no surprise that college leaders sounded relieved after lawmakers last week narrowly overrode a gubernatorial veto and passed a state budget for the first time since 2015. The $36 billion spending plan enables them to move out of a triage mind-set.

“It allows us to begin to sort of plan again,” Helldobler said. “When you can’t plan because you don’t know if you’re going to get any state appropriation, that makes it very difficult.”

But the state’s spending plan is a mixed bag for the higher education sector. It cuts state support for universities and community colleges by 10 percent below 2015 levels — although they will still receive much more than they did during the stopgap 2016 and 2017 fiscal years. It also adds more than $36 million to the MAP program, pushing it above $400 million in the 2018 fiscal year after two years of uncertainty and stop-and-start appropriations.

The full ramifications of the new budget — and the end of the impasse — can’t be fully measured so soon. Still, it is clear that the impasse seriously hurt both institutions and students by forcing painful cuts, eroding enrollments and driving down confidence in public education. It is also clear that it has changed the outlook of many leaders for the future.

Some have pointed out that Democrats who lead the Illinois Legislature managed to pass the budget with some Republican votes despite intense opposition from the state’s Republican governor, Bruce Rauner. The spending plan does not resolve fundamental disagreements over taxes, regulations and hundreds of billions of dollars in unfunded state pension liabilities.

“I think most universities will engage in conversations about what it means to be in public higher education in Illinois,” Helldobler said. “People need to understand this isn’t over. We really think that the budget will be a very complex conversation next year as well.”

Pressure Mounted

The dire situation at the state’s colleges and universities was a key factor for some legislators. State Senator Dale Righter, a Republican whose district includes Eastern Illinois University in Charleston, was the only Republican senator to support tax increases in the budget package. He cited damage the budget standoff has inflicted on Eastern Illinois University, according to the Chicago Tribune.

In the House, another Republican whose district includes Eastern Illinois voted for the measure.

“It doesn’t make me any less of a conservative Republican than the rest of the people standing here,” said Representative Reggie Phillips, according to the Tribune. “It makes a person decide he has to vote for his district. He has to think about all the people in his district to the best of his ability.”

Eastern Illinois has cut hundreds of positions amid the state’s budget crisis. The university’s president, David Glassman, said in March that the university had cut low-enrollment programs, eliminated 413 positions — almost a quarter of its employee head count — imposed furlough days for employees, extended vendor payments and reallocated funds internally in order to continue operating.

Nonetheless, the financial sector became increasingly worried about the university in light of the state budget standoff. Moody’s Investor Service downgraded Eastern Illinois in June, saying the move reflected the university’s highly stressed financial position and noting the institution had nearly exhausted its liquidity. The ratings agency also downgraded other Illinois public universities it rates, including the University of Illinois, Illinois State, Northern Illinois, Southern Illinois, Governors State and Northeastern Illinois.

Some universities maintained higher bond ratings than others based on stronger financial positions. Generally, the state’s larger and better-known institutions, which have diverse revenue sources like federal grants and endowment income, fared better throughout the crisis than its smaller institutions, which rely more heavily on the state for funding.

Northeastern Illinois is an example of a university that struggled. In the 2015 fiscal year, the last year Illinois had a budget in place, the state provided $36.7 million in funding to Northeastern Illinois, and it fully funded MAP grants for students. Those two sources of funding were worth about 40 percent of the university’s $92 million budget.

In the 2016 fiscal year, the state provided $10.7 million in funding plus MAP grants, leaving a funding shortfall of about $26 million. After more stopgap funding was released in July 2016, the university calculated a shortfall of about $17 million for the 2017 fiscal year, according to a university spokesman.

But even the state’s most prominent university system felt the pressure from the budget situation. The University of Illinois System, which in 2015 relied on state revenue for only about 12 percent of its $5.6 billion operating budget, proposed a deal with the state. The system was willing to agree to performance-based funding metrics in exchange for predictable funding over five years.

The University of Illinois stood out from most of the state’s other public institutions because it was able to increase enrollment during the budget standoff. Still, it has shed staff members and reported an uptick in the number of faculty members leaving its flagship campus.

MAP Funding Problems

The way MAP funding was disbursed was problematic for institutions both public and private. MAP grants go to undergraduates from Illinois who have financial need and attend public or private institutions.

But the state only allocated stopgap MAP funding while the budget standoff dragged on. In 2016, money came late. No MAP money was available for the 2017 fiscal year before the budget deal passed Thursday. The spending bill did allocate MAP funding for 2017.

The funding uncertainty left many institutions crediting MAP grants to students’ accounts and trusting that the state would one day pay. It was another source of financial stress — and not all institutions were comfortable crediting accounts with MAP grants or in a financial position to do so.

Officials believe the uncertainty led many students to not attend college or attend out of state.

“There were students last year who dropped out,” said Lynne Baker, spokeswoman for the Illinois Student Assistance Commission. “It’s a lot of damage, when you consider you’ve got students who may have been halfway through their programs, may have been almost finished with their programs.”

In order to determine the effects of the uncertainty, the Illinois Student Assistance Commission surveyed financial aid administrators at institutions approved for MAP grants in the fall of 2016. Administrators at 96 of 132 institutions responded. Just 60 percent of respondents said they credited the full MAP award to students for the year’s first term. Of those crediting full MAP grants for the term, only 31 percent of respondents definitively said they would not require students to pay for any shortfall in the program — meaning many students faced the prospect of being on the hook for the money if the state did not pay.

Behavior varied greatly by institution type. While 91 percent of public universities responding credited student accounts for the full MAP award, just 27 percent of community college respondents reported doing so. And 70 percent of private institutions said they credited the full MAP award to student accounts.

The Illinois Student Assistance Commission also tabulated survey responses from 12,000 students eligible for the MAP award in late 2016. Many indicated that the budget delay on MAP funding for the first term of the 2016-17 academic year had an effect on their education goals. Some reported working more to cover expenses, taking out more student loans, taking fewer credits, transferring to less expensive institutions or not enrolling because of MAP funding issues.

“Students were really stuck,” Baker said. “Do they go part-time? Do they drop out if they can’t afford it?”

Other data indicate uncertainty over MAP funding might have caused students to think twice about attending college in the state. The volume of FAFSA applications in Illinois dropped 14 percent year over year, the Illinois Student Assistance Commission said in June.

“What’s happening in Illinois with the budget impasse and the lack of funding for both MAP programs and the public universities is creating a lot of this decline in volume,” said Eric Zarnikow, the executive director of the commission, according to Peoria Public Radio.

Institutions also faced accreditation pressure stemming from the state budget issues. The Higher Learning Commission in June sent a letter to the state’s governor and legislative leaders noting effects of the budget crisis on the state’s institutions. Those effects included increased tuition and fees, declining student enrollments, loss of faculty, the elimination of services, canceled capital projects, and dwindling cash reserves.

“As the accrediting agency tasked with assuring quality, I must warn you about the accreditation consequences of the failure to provide sustainable funding for Illinois higher education,” read the letter from Barbara Gellman-Danley, the president of the Higher Learning Commission, according to The Southern Illinoisan.

The Illinois Community College Trustees Association is in the middle of a survey to determine the impact of the budget impasse. Slightly more than one-third of colleges have responded so far. They said they employed almost 1,800 fewer employees as of June 30 of this year than they did at the same time in 2015, according to Michael Monaghan, the association’s executive director.

Respondents also said they had eliminated almost 6,200 sections of class offerings and 70 programs.

“Students now appear to have fewer choices and therefore less access to Illinois colleges,” Monaghan said in an email.

Looking Forward

For the hardest-hit public institutions in Illinois, the passage of the state budget is only the beginning of attempts to chart a way forward.

The long-troubled Chicago State University laid off about 300 employees, a third of its work force, during the standoff. It only enrolled 86 freshmen in the fall of 2016, and enrollment had fallen from more than 7,300 in 2010 to under 3,600. Some feared its closure was unavoidable.

The stability of a state budget will allow the university room to pay its bills, restart recruiting that had been all but stopped and plan for the future, said Paul Vallas, Chicago State’s chief administrative officer. Vallas, a former Chicago State board member, took the position in April along with a new interim president.

“We used to get about a third of our revenue from the state,” Vallas said. “Now it’s in the high 20s. We’d like to be less dependent on state funding, and we’d like to be more financially self-sufficient.”

The university plans a $79 million budget for the 2018 fiscal year.

Northeastern Illinois is going through a similar planning process, said its interim president, Helldobler. It’s evaluating programs for growth, shrinking or elimination. It’s looking at different budget models.

The process might be painful. But the last two years have been painful, too.

“At least now we have an appropriation,” Helldobler said. “Let’s get down to work, as opposed to negotiating furloughs or negotiating 180 position eliminations and those kinds of draconian measures.”

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State faces lawsuit over higher education funds

TALLAHASSEE — Two University of Florida alumni have filed a class-action lawsuit against the state, saying lawmakers and Gov. Rick Scott funneled money that should have gone to higher education into tax cuts and savings.

The legal challenge, filed last week, is based on the Legislature’s decision not to provide matching funds for private donations to colleges and universities. State law creates four matching programs, and the plaintiffs argue that lawmakers are required to match the donations unless the state faces a budget shortfall.

The alumni, Ryan and Alexis Geffin — who graduated in 2016 and 2017, respectively — say they were harmed particularly because matching funds weren’t provided for construction projects at the University of Florida.

In all, the lawsuit says the state’s failure to fund the programs has locked up more than $1 billion that should have been available to colleges and universities, including at least $600 million in state matching funds and $460 million in private donations waiting for matches.

The filing also contrasts statements by Scott and legislative leaders touting the importance of higher education with the refusal to set aside funding for the matching programs.

“Rather than appropriate the over $600 million in state funds owed, the governor and the Legislature have spent general revenue surpluses on multibillion dollar tax cuts and to set aside billions in reserves,” it says.

The programs subject to the lawsuit include the Dr. Philip Benjamin Matching Grant Program, which primarily provides scholarships and financial aid; the University Major Gifts Program, aimed at encouraging donations to university endowments; and two construction-related funds, the Florida College System Institution Capital Facilities Matching Program and the Alec P. Courtelis University Facility Enhancement Challenge Grant Program.

According to the lawsuit, the problems began in 2008, when the state first faced shortfalls from the recession. Payments to the matching funds stopped, something that the legal challenge doesn’t contest.

But after the state again began running surpluses, lawyers for the alumni argue, the state should have resumed making the payments to the matching funds. Instead, the Legislature has continued to omit the funding.

“The state of Florida made a promise — a promise codified in Florida law and further reinforced in promises made to donors — and, there is no other way to put this, but the state reneged on that promise,” said Grace Mead, a lawyer with the firm Stearns Weaver Miller, which is representing the alumni. “The purpose of this suit is to force the state to fulfill that promise.”

According to Stearns Weaver Miller, UF could be due more than $155 million, while Florida State University, Florida International University and the University of South Florida could be owed more than $40 million each. Miami Dade College could be due more than $70 million.

Mead also said she expects a lawsuit on behalf of donors whose contributions weren’t matched.

A spokeswoman for Senate President Joe Negron, a Stuart Republican who has made higher-education funding a priority, said Thursday that his office was reviewing the challenge. A spokeswoman for the Florida Department of Education said the agency had not received the lawsuit, but would review it. 

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Local school districts eye Springfield debate on education funding

Student registration is just around the corner for area school districts and the doors are expected to open in less than a month, but area superintendents are still unclear about how their districts will be funded.

The Altamont school district has 54 days of cash on hand and Effingham has 216 days, as of Tuesday. The school year involves 180 days.

While both districts can afford to start school on time, that’s reportedly not true with some rural districts across the state.

Gov. Bruce Rauner called a second special legislative session in a month, scheduled to start Wednesday. The sticking point this time involves what some are calling a Chicago “bailout” that would help that district pay for teacher pension-payment shortfalls.

The legislation would revise the way schools receive state aid for the first time in two decades, according to the Associated Press. The method funnels money to the neediest school districts first, after ensuring that no district receives less money than last school year.

It also includes a provision that prohibits the state from issuing state aid to schools unless it’s done through Evidence Based Model calculations.

During Monday’s Effingham school board meeting, Superintendent Mark Doan said he’s hopeful for a decision by July 31, after the second special session.

“By no means does SB1 totally level the field, but it is a positive step in providing all students a better chance for a quality education, wherever they may live in Illinois. Unit 40 would benefit from SB1, if it passed,” he said.

However, Doan said the concern is what happens in the following years: “Will the state continue to support both K-12 and higher education at an acceptable level?” he asked.

Altamont Superintendent Jeff Fritchtnitch said in an interview that for now his district is building a budget using last year’s state budget. It has an available line of credit with a local bank, should funding be needed, but that’s not optimal.

“We would receive more money under Senate Bill 1 and Senate Bill 1124, but we are not sure what is in those bills,” said Fritchtnitch. “We don’t know how much is in general state aid and how much is categorical payments.”

He added information he received from the Illinois State Board of Education was under SB1, Altamont would receive about $207,000 in additional state funds. In SB 1124, the amount is reportedly $397,000 more in state funding.

According to ISBE, Effingham would receive additional $107,000 under SB1 or about $215,000 under SB1124.

“As far as Senate Bill 1 and Senate Bill 1124, I get a little leery when they change the formula and they don’t tell you exactly what’s in the numbers,” said Doan. “That’s the discussion going on right now.”

Even though Unit 40 would receive less under SB1, Doan said the proposal is good for all schools and “addresses the equity and adequacy school funding” across the state. He said it also has the support and passage of the House and Senate, which makes it appealing, and the promise that no district would lose money, he added, is another plus.

Although Rauner has said he will cut the Chicago pension payment from the proposed SB1, it hasn’t even made it to the governor’s desk.

On July 17, Rauner announced he would issue an amendatory veto of Senate Bill 1, once he receives the legislation, State Sen. Dale Righter, R-Mattoon, said a press release.

“Democrats need to stop playing games, release the legislation so Gov. Rauner can act on it, and so we can get back to Springfield as soon as possible to work on this highly critical issue,” Righter said in the release dated July 18.

Righter said despite having a state budget in place, schools are still not receiving their funding because the actual appropriation part is tied to enacting a new education funding reform plan.

Righter referred to where it shows the amount of funds a district would be allotted under SB1 and under Rauner’s plan. These numbers are different than ISBE figures for funding schools. Righter referenced a chart that can be found at . This discrepancy in the formula is what concerns superintendents.

The Illinois State Board of Education’s list of funding figures for schools can be found at

Fritchtnitch said superintendents and boards of education in Illinois have enabled legislators to not find a funding solution for Illinois schools.

“For the past seven years, superintendents have found ways to cut and reduce and seek support for athletic teams,” said Fritchtnitch. “During that time, schools have dropped programs and class opportunities for students, cut FFA and agriculture in order to deal with these issues.”

Fritchtnitch said there are districts in Illinois that without a funding formula in place cannot afford to open this fall. Should it come to that, it poses more of an economic downfall for Illinois.

“What do parents do with their children?” he said. “It will have a ripple effect for the state. This just puts an exclamation point at the end.”

Contact Dawn Schabbing at at 217-347-7151, ext. 138

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President of troubled French funding agency resigns

Natalie Hill/Science Europe/CC BY 2.0

Michael Matlosz resigned as president of the French National Research Agency last week.

French researchers say they’re pleased that the president and chief executive of the country’s National Research Agency (ANR) has stepped down, but worry that the organisation’s woes might not be resolved by his exit.

Michael Matlosz resigned on 21 July, after more than a year of widely reported discontent with how the funding body was being managed. Despite an uptick in its budget this year, the ANR’s funding is still less than it was in 2012, and success rates for grant applications are worryingly low.

Matlosz, a former chemical engineer who was promoted to his post in 2014, left because the agency needed “a new impetus” following recent organizational changes, according to an 18 July statement by Frédérique Vidal, who became France’s minister for higher education, research and innovation in May. Matlosz and the ANR declined to comment further. Arnaud Torres, an ANR director, is serving as an interim chief until a new head is found.

Year of discontent

Many scientists say that Matlosz’s management created serious tensions within the ANR, including administrative choices that upset senior scientists and those who served on grant-evaluation panels.

The agency has had a number of public upsets. In March 2016, sociologist François Héran was fired as head of its social-sciences department. In June the same year, all 20 members of an evaluation panel in mathematics and computer science resigned together, complaining that bureaucracy had reduced their freedom to select proposals. Last month, molecular biologist Catherine Dargemont, director of the agency’s biology and health division, was fired after she sent a letter to the ANR’s governing board, co-signed by ten colleagues, complaining about “recurrent dysfunctions” at the ANR, including the gradual sidelining of senior scientists in important decisions.

And on 26 June, Bernard Hoflack, a proteomics researcher at the Technical University of Dresden, Germany, who is president of the ANR’s evaluation panel in cellular and developmental biology, wrote to the agency’s management on behalf of 9 out of 13 panel heads, criticizing poor internal communication, among other things.

Bernard Meunier, a chemist and past president of the French Academy of Sciences, says that ANR bureaucracy is still too burdensome. “Principal investigators spend a huge amount of time on applications, filling in endless forms, finding partners and trying to justify the nine new ‘societal challenges’, which politicians believe will help create jobs and wealth,” he says. He thinks that 70 measures introduced by previous research minister Thierry Mandon to simplify researchers’ lives have had almost no impact because administrative bodies resisted them.

The ANR also has broader problems. In France’s latest budget, for 2017, the agency’s spending was boosted 8% to €643 million (US$748 million) — still lower than the €710 million it was allotted five years ago. This means that competition to win project funds is fierce, with average success rates running at a paltry 12–13%.

On 11 July, Vidal told a French senate committee that the ANR budget would have to be increased. But last week, the government proposed a cut of €180 million to the research ministry’s budget, out of a total €331-million reduction in funding for higher education and research amidst wider cuts of more than €3 billion in public spending. That does not augur well for increases at individual agencies; the ministry said it had not yet decided how much the ANR might lose in funds.

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The high price of cutting state funding to colleges

Policy makers and experts often hotly debate the reasons behind rising college costs. New research indicates that state disinvestment in higher education may be at least partly to blame.

For every $1,000 in funding per student that states cut from public universities, students paid about $257 more a year on average between 1987 and the present, according to a forthcoming study in the journal, Economics of Education Review. But students attending college more recently are even more likely to shoulder a larger burden of cuts to state funding. Before 2000, students paid about $103 more a year on average for every $1,000 per student cut by states. After 2000 that number increased to about $318 more a year, the study found.

“There is a clear link between state appropriations and the price that students pay,” said Douglas Webber, an economics professor at Temple University and the author of the study. “It’s not a one-to-one thing — although we wouldn’t necessarily expect it to be — but on average, as states divest, students do bear some of that cost.”

The findings add some concrete figures and nuance to the debate over the role of declining state funding has had in pushing up college costs and student debt. Over the past several decades and in the wake of the Great Recession, states have cut funding to higher education, leaving public colleges and universities with smaller budgets to work with.

Webber’s research indicates that schools cope with that loss of funds in part by charging students more. But the findings also suggest that colleges find other ways to absorb those declines in state funding. Those could include increasing revenue through things like endowment returns, or fundraising, Webber said. Instead of raising revenue, schools may choose to cut costs, which in some cases could affect student outcomes. A college could decide to shift its teaching staff towards adjunct faculty instead of full-time professors to save money, Webber said.

While colleges do find other ways to contend with losses in state funding, state disinvestment has accounted for an increasing share of rising college costs over the past several years. Since the Great Recession, more than 40% of increased tuition revenue has come from state cuts to public universities, compared with just 16% between 1987 and the present, Webber found.

Based on his data it’s hard to figure out exactly how these costs are passed on to students. It could be that the increased costs are spread evenly among all types of students, but it’s also possible that colleges may use other strategies, Webber said. For example, they could shift their enrollment mix to include a larger share of wealthier students who are more willing to pay higher prices.

Webber said he plans to investigate further exactly how colleges are passing along cuts to state funding, but for now, he hopes his research will help provide some grounding for a policy debate that’s been raging for years and is likely to continue. “The left and right often are shouting past each other on state divestment issues,” he said. “The right tends to ignore that there is any negative at all and I think the left tends to imply that any state divestment is always a bad. Neither of those two things are true.”

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Emergency grants help Minnesota’s strapped students stay in college

As a college administrator, Muzamba Sibajene has met more than her share of struggling students. Some are so financially strapped, she said, that even one setback — a car breaks down, a child gets sick — can force them to drop out of school.

So when she heard that one student at her school, Alexandria Technical and Community College, lost his home and was sleeping in his car, she tracked him down at a Walmart parking lot — and changed his life.

Sibajene dipped into a special emergency fund at the school to help the student find a place to stay and pay his first month’s rent. As a result, he not only stayed in college, she said, “he graduated and he’s now a police officer.”

Starting this year, the Minnesota Office of Higher Education is launching its own emergency fund program for students, inspired in part by Alexandria’s success.

Such grants, which typically cover a few hundred dollars for one-time emergencies, have become increasingly popular as a way to stem the dropout rates of low-income students, said Larry Pogemiller, Minnesota’s higher education commissioner. They’re designed, he said, to “help students out and dig them out of holes” so they can stay the course.

At many schools, like Alexandria, the emergency funds have come from private donations or foundations. But this spring, in a rare show of bipartisanship, Republican and DFL lawmakers rallied behind a proposal by Gov. Mark Dayton to start a statewide program.

They set aside $175,000 a year, for the next two years, to provide matching funds to help colleges offer such emergency grants.

“There was no resistance,” said Pogemiller. “Every legislator who has heard about this goes, ‘Yep, I know a kid who could use this.’ ”

In Alexandria, school officials started awarding the grants in 2014, thanks to a $400,000 gift from the Otto Bremer Trust.

They began by asking students what was stopping them from completing their degrees.

“It wasn’t the academics,” said Ross Santell, vice president for academic and student affairs. “It’s just life issues that get in the way.”

In the next two years, 236 Alexandria students received grants, averaging about $1,500 apiece, for expenses ranging from car repairs to housing emergencies.

In one case, said Sibajene, who oversees the program, the extra money helped a young woman escape an abusive relationship and remain in school.

“There’s literally 236 of those stories where we were able to make a difference,” she said.

Bobbie Hauser, a 27-year-old student at Central Lakes College in Brainerd, said she almost dropped out last fall when she fell behind on her children’s day care bill. But she was able to cover the costs with a $460 emergency grant from her school’s program, known as RAK, for Random Acts of Kindness. The extra money, she said, made “a really big difference. I haven’t fallen behind since.”

Taylor Dircz, 20, who is studying to be a medical assistant at South Central College in North Mankato, said she started to panic when the steering went out on her 2001 Chevy. “I was scared — how am I going to get to school?” she said. A $490 check from what her school calls its Lifesaver program covered the bill. The grant “basically took all the worry off my shoulders,” she said. “It is a lifesaver.”

Jayne Dinse, director of admissions and financial aid at South Central, said the grants have been used to cover spiking utility bills during a harsh winter, broken eyeglasses and a stolen bicycle.

“One of the things that we stress is that we’re looking at that unforeseen emergency,” she said. But school counselors also advise students on other resources, such as food shelves, for ongoing financial challenges.

The students, meanwhile, have been endlessly grateful. One, Dinse said, “made me a little plaque that hangs in my office that says ‘Jayne, because of you, I didn’t give up.’ ”

South Central has been awarding the grants since 2016 with funds from the Great Lakes Higher Education Corporation, which has supported similar programs at dozens of colleges in the Upper Midwest.

Many of these students already receive large amounts of financial aid, including federal and state grants, to help with tuition and living expenses. But supporters say these small emergency grants serve a different purpose.

“You just help them get through a rough patch and students will not stop out,” said Lisa Mohr, who runs the emergency grant program at Rochester Community and Technical College. And that in turn can boost graduation rates, she said. “Often, students who drop out don’t come back.”

Not everyone who seeks a grant gets one, officials said. Applicants have to provide proof of the expense, and it has to be a true emergency. “We don’t pay people’s cellphone bills or internet or their TV cable,” said Mohr. “We don’t do the wants … we focus on the needs.”

The new state funding probably won’t go very far in meeting the demand, said Pogemiller, the higher education commissioner. But he said he hopes it will encourage more schools to join in and raise funds on their own.

In Alexandria, meanwhile, college officials are looking for new ways to fund the grants now that the original gift has run out. But Sibajene has no doubt that the investment, for these students, is worth it.

“The money that we gave them didn’t fix their lives,” she said. “But [it] definitely gave them a psychological push to believe that they can do this.”


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Paying for higher education results might help Hoosiers

Should public colleges and universities get a funding boost for helping students graduate — especially the economically disadvantaged and those going into high-demand jobs?

If you think the answer is yes, you might be encouraged by a new study that shows the funding boost appears to be working — helping more Hoosiers obtain education and training critically needed in a fast-changing economy.

For state schools in Indiana, it’s a case of doing well by doing good: $143 million in funding based on student outcomes is at stake in the state’s current two-year budget. That is a small part of the $2.6 billion in public support of Indiana colleges and universities, but it’s making a big difference.

Philadelphia-based Research for Action, an independent research organization, has studied outcomes funding for several years in Indiana, Tennessee, and Ohio using a wide range of data and sophisticated analytical techniques from four-year institutions.

Among findings:

  • During the period studied, full-time students who began college in 2009-11 were more likely to graduate on time, and an extra 1,547 Indiana students earned bachelor’s degrees.
  • Full-time students who started college in 2011 were 12 percent more likely to attain degrees in science, technology, engineering and math (STEM) or other high-demand fields.
  • Even with a small portion of state funding at stake, the policy’s effectiveness has grown each year.

More than just the students and their families benefit. Indiana’s economic health depends on a well-educated workforce. Without a dramatic increase in education attainment, Indiana stands to be left behind.

With that in mind, Indiana policymakers have sustained and increased support for outcome-based funding as part of the state’s goal of 60 percent of all working-age Hoosiers obtaining college degrees or high-quality workforce credentials by 2025.

The state’s formula rewards colleges for ensuring that students graduate on time and for awarding more degrees and workforce certificates, especially in high-demand fields. Indiana offers additional funding to encourage schools to serve and graduate more students from low-income families.

To meet the nation’s growing shortage of talent, several states now use some form of outcomes-based funding for higher education. The idea is to link public dollars to key student outcomes such as credit completion, retention and annual increases in graduates.

That’s a big change from traditional approaches based on enrollment or what budgets in previous years contained. The upshot is that these policies now determine how hundreds of millions of dollars are distributed to public colleges and universities across the country.

Of course, we still have a way to go. The Research for Action research, supported by Lumina Foundation, shows that full-time Pell Grant recipients did not enroll in lower numbers, as some had feared, but they also did not experience hoped-for gains in completion. Little change was seen for part-time students as well.

And gaps in educational outcomes by race and ethnicity — a major equity concern as well as a roadblock to educational progress — stayed about the same. African-American and Hispanic students in Indiana continue to lag not only white and Asian students, but also their counterparts nationally.

While we work on those shortcomings, it’s worth pausing a moment to consider just what this study means: Change takes time in education, that’s a given. However, this emphasis on accountability and results shows real promise. You would expect it to work, and now we know from the evidence that it can.

There’s more to do, but this funding approach means a lot to a state rebooting its economy to be a better global competitor. It means a lot to the Hoosier graduates and their families who in recent years have seen the door to a better life open through education.

Merisotis is president and CEO of Lumina Foundation. Lubbers is commissioner of the Indiana Commission for Higher Education.

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State Funding Cuts Matter

Have public funding cuts caused colleges and universities to raise tuition?

It’s a deceptively simple question. And it’s caused two different camps to dig in, look at similar data and yell past each other with very different answers.

On one side, typically inhabited by left-wing thinkers, is the camp that believes tuition has gone up over time because colleges have been starved by state and local funding cuts to higher education. On the other side, right-wing analysts often argue that the long-term decline in state funding — so-called state disinvestment — has little to no effect on tuition. Instead, they say, college tuition has gone up for other reasons, like meeting rising labor costs or feeding spending urges.

Various battles have been fought over issues such as whether using different inflationary indexes to adjust data will lead to different conclusions. But there has been surprisingly little work done to try to pin down the exact rate at which public appropriations cuts are passed on to students through higher tuition.

That’s changing. New research in the journal Economics of Education Review finds the appropriation-cut-to-tuition pass-through rate has averaged 25.7 percent since 1987. In other words, for every $1,000 cut from per-student state and local appropriations, the average student can be expected to pay $257 more per year in tuition and fees.

The research also indicates students are taking on more of the cost of state funding cuts in recent years than they were three decades ago. Before 2000, a student could be expected to pay $103 more in tuition for every $1,000 cut from public funding. After 2000, the figure jumps to $318.

Those findings have the potential to reframe the debate, at least somewhat. They could shift the discussion away from if funding cuts lead to rising tuition to how much they contribute to rising tuition — and whether such a trade-off is justified.

But for many researchers, the pass-through rate, which describes what will happen to tuition in the event of a theoretical state funding cut, hasn’t been considered a top priority to examine, said the author of the research, Douglas Webber.

Webber, who is an associate professor in Temple University’s economics department, said researchers have been more interested in broader looks at how students are affected by governments cutting funding for higher education. Colleges and universities can take a number of actions when their state funding is cut. They can increase tuition to make up for the lost revenue. They can cut from their own budgets, trimming things like student services or employees. Or they can turn to fund-raising, endowments and grants to try to raise more money over time.

Against all of those puzzle pieces, the amount students pay in tuition can seem relatively minor — especially for researchers trying to determine how much funding cuts affect a student’s chances of graduating.

Another strike against this type of analysis is that a large number of local factors and other variables can influence how much individual colleges and universities raise tuition. State laws block some colleges from raising tuition without legislative approval, for example. Webber had some questions about whether it made sense to calculate an average pass-through rate. Such a broad metric won’t reflect reality in the situations on the ground at many different colleges and universities.

Still, Webber has participated in the debate over state disinvestment. He wrote a piece for FiveThirtyEight last year arguing that there is no single cause for rising college tuition. He planned to someday do a more rigorous analysis, but he had to push the work to the back burner as he addressed other priorities.

The state divestment arguments didn’t go away. A Cato Institute study in February made the case that state disinvestment was not the sole cause of rising tuition, putting blame on federal student aid it said enables colleges to charge more. Brookings published a piece by Jason Delisle of the American Enterprise Institute saying that limited research on the topic shows state disinvestment is not a major cause of tuition hikes. AEI published a study saying that public institutions’ tuition only rises by $5 for every $100 cut from direct state subsidies per student.

That study’s modeling was questioned by critics, including Webber. He went about building a new model taking into account adjustments he hadn’t seen elsewhere. They included accounting for state laws restricting institutions’ ability to increase tuition and the fact that lawmakers may cut appropriations unevenly for different colleges within the same state. He also measured average net tuition and fee revenue instead of institutions’ average posted tuition in order to account for strategies colleges might use to raise money after a cut in state appropriations — strategies like cutting student aid or enrolling more out-of-state students.

Webber used data on institutional finances from the Integrated Postsecondary Education Data System from 1987 through 2014. The data cover 479 four-year public institutions.

“I don’t view this paper as a partisan thing,” Webber said. “The far right wants you to think that there is a zero percent pass-through rate and any state budget cuts aren’t hurting students. The far left wants you to think that the harm to students is absolutely massive and that we should never cut university budgets. And neither of those views are correct.”

In addition to the 25.7 percent average pass-through rate for all institutions, Webber calculated the rate for different types of institutions. It was highest for Ph.D.-granting institutions, at 26.6 percent. Master’s-granting institutions were close behind at 26.2 percent, followed by bachelor’s-granting institutions at 18.3 percent.

Webber also analyzed the historical data he’d gathered. The pass-through rate describes what will happen in the event of a theoretical $1,000 appropriations cut. The historical data give a look at what did happen over the last 30 years.

State and local divestment accounted for 16.1 percent of tuition and fee increases paid by the average student since 1987. Disinvestment accounted for a greater share of tuition and fee increases more recently, though. It is responsible for 29.8 percent of the tuition and fee revenue increase since 2000 and 41.2 percent since 2008.

That’s evidence colleges and universities are being pushed closer to their breaking point, Webber said. Institutions can cut from budgets up to a certain point in order to shield students from tuition increases. Eventually they have to start passing more costs on to students.

“The fact that this has been increasing says to me that in the ’80s and ’90s, there probably was a lot more fat in the budget,” Webber said. “And so, when states would divest, it was a lot easier for schools to cut things. Whereas now, the low-hanging fruit is diminishing. We’re having to make tougher decisions, and we’re having to pass more of these costs on to students because there’s not some obvious spending that we can cut.”

Not everyone will agree on that point. Policy makers will still wonder why, if appropriations cuts really drive tuition higher, the pass-through rate isn’t 100 percent, said Delisle of AEI.

“Maybe the relationship is getting stronger, but I think you’re going to be hard-pressed to convince a policy maker that a move from 25 percent to 32 percent is a really big change,” he said.

Delisle went on to argue that the relationship shown in the new research is relatively small compared to claims he’s seen that state disinvestment causes tuition increases.

“The debate now seems to be, is it 15 percent, is it a 25 percent relationship, is it 30 percent?” he said. “Two months ago, it was just assumed to be one for one.”

The fact remains that continuous state disinvestment in public colleges and universities drives tuition increases, according to Thomas Harnisch, director of state relations and policy analysis at the American Association of State Colleges and Universities.

“While campus leaders have long sought efficiencies instead of tuition increases, this study seems to indicate the limits of that approach,” he said in an email. “The share of tuition increases that can be traced to state budget cuts has more than doubled since 1987 and remains at its highest level in the post-recession era.”

Harnisch called state budget cuts a no-win outcome for students and states. The state cuts diminish institutional quality as well as restricting access to higher education and higher bills for students, he said.

Webber’s hope is to move the discussion beyond the two absolutes of state disinvestment hurting students versus state disinvestment not mattering. He wants it to become something an economist would appreciate about the costs and benefits of state funding cuts.

Many states will have to consider cutting higher education spending to address other priorities like health care or pension spending. The hope is that the discussion can be about how much such cuts are likely to be passed on to students and whether it’s worth it.

It’s akin to a move from partisan talking points to a cost-benefit analysis. Webber has some reason to be optimistic. Feedback so far has been positive from both sides of the argument, he said.

“I’m hoping to move the conversation from shouting past each other to actually thinking more seriously about the magnitude of trade-offs,” Webber said.

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UNC president: State funding at best in a decade

North Carolina has long benefited from one of the best-supported public university systems anywhere in the country. And the budget state lawmakers approved last month – the best budget for the University in a decade – will help keep it that way, strengthening higher education to meet new challenges in a changing economy.

The legislature fully funded enrollment growth for the state’s 17 public institutions, giving more North Carolinians the chance to pursue opportunity. And lawmakers bolstered the state’s historically black universities with targeted investments at Elizabeth City State University and North Carolina AT. Most importantly, legislators committed full funding for NC Promise, an initiative that drops tuition to just $500 per semester at Western Carolina University, UNC Pembroke, and Elizabeth City State University.


At a time when states across the country are struggling to rein in college costs, North Carolina has invested in a bold experiment to make higher education more affordable for families at all income levels. NC Promise lifts much of the burden on students without sacrificing quality, guaranteeing that every region of the state has an extraordinarily affordable option for earning a degree. And that’s on top of the solid state funding that keeps tuition at all of our public institutions far below the national average.

Keeping the balance between public support and personal investment in higher education was particularly tough during the Great Recession and the slow recovery that followed. But today, with a growing economy demanding an even better-educated workforce, we have the chance to make smart investments in the future. And North Carolina is seizing the moment.

Over the next few years, state support will allow our public universities to begin investing in advanced data analytics that can identify problems early and help more students graduate on time. Reducing the time it takes to earn a degree lowers costs for both families and taxpayers without compromising value.

Lawmakers also backed a competitive grant program to accelerate high-value research, recognizing that University discoveries have made North Carolina a hub for new industries.

Our challenge in the years ahead is to make sure that those resources reach more North Carolinians, closing the gaps in opportunity that threaten to divide our state.

A few months ago, the Chronicle of Higher Education put our state on the cover, under the headline “The 2 North Carolinas.” A changing economy has created a divide between those with solid pathways to advanced education and prosperity and those who face a more uncertain future.

That inequality of opportunity – between thriving and struggling school districts; between suburban and rural students; between low-income families and their wealthier neighbors – weakens our core faith in the American Dream. Our public universities have a special obligation to address those inequities, to offer every talented and driven student a reasonable path to higher education.

That’s why we’ve made a public commitment to enroll and graduate more low-income students; to recruit more students from our rural communities and urban centers, places where higher education often seems out of reach; and to partner much more closely with public schools across the state so that students arrive on our campuses ready for college-level work.

If our state is going to thrive in the decades to come, there can’t be two North Carolinas. The University of the People has to remain the University of all the People.

There’s a lot of work ahead of us. But thanks to the steadfast support of our legislature and our citizens, we have the resources and the will to get it done.

Spellings in the president of the University of North Carolina.

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Negron touts higher education changes despite veto

The governor’s veto of a wide-ranging higher-education policy bill did not block many of the initiatives embedded in the legislation, Senate President Joe Negron said.

TALLAHASSEE — Despite the governor’s veto of a wide-ranging higher-education policy bill, Senate President Joe Negron said Wednesday that many of the initiatives embedded in the legislation, including an expansion of Bright Futures scholarships, will still benefit state university and college students as fall terms begin next month.

In a memo to senators, Negron, R-Stuart, said a major benefit will be a “historic” increase in need-based and merit-based financial aid.

“This school year, tens of thousands of students are entering or returning to colleges and universities across Florida with a higher level of financial security, increasing the likelihood they will graduate on time,” Negron said.

The new $82 billion state budget includes funding to increase Bright Futures scholarships to cover full tuition and fees for about 43,000 state university and 2,000 state college students who qualify as “academic scholars” in the merit-based program.

It represents a $3,000 tuition savings for full-time university scholars and a $1,500 savings for state college scholars.

Additionally, the budget provides funding to allow an estimated 17,000 Bright Futures scholars to attend summer classes with their scholarships.

However, the Bright Futures expansion will be temporary unless lawmakers enact a policy bill in the 2018 session to make the changes permanent. That is because Gov. Rick Scott vetoed this year’s wide-ranging policy bill (SB 374), arguing improvements for state universities were coming “at the expense” of the state college system.

“I feel a deep sense of obligation to the tens of thousands of students and families who are reasonably relying on Bright Futures scholarships their students have earned,” Negron said, recalling his own anxiety over financial aid when he was a university student.

“As Florida students and their families plan for their investment in a college or university education, they deserve the financial security that comes with the permanent changes in law contemplated in SB 374,” he said.

The new budget also includes an 80 percent increase in the state’s main need-based aid program, known as Florida student assistance grants, Negron noted.

The expansion will benefit an additional 109,000 university and college students for a total of 243,000 students securing the aid, which averages $1,110 per student.

The budget will also increase funding for other aid programs, including the Benacquisto scholarships, which support National Merit Scholars, and an aid program aimed at “first generation” students attending colleges or universities.

Negron said he was pleased that the Department of Education, which is under Scott, is trying implement most of the financial-aid programs that were in the Senate bill “despite the veto of critical conforming language” that specified the changes.

But other policy provisions in the vetoed Senate bill, which were less dependent on the state budget, remain in limbo, including a requirement that universities develop “block” tuition plans and that universities be measured on four-year graduation rates rather than the current six-year metric.

Tom Kuntz, chairman of the university system’s Board of Governors, said at the board’s meeting last month that the system would be considering many of the proposals in the policy bill since they were not related to the veto decision and because “it’s the right thing to do.”

Negron said he was appreciative of the board’s effort, while saying the Senate will take up many of the policy issues again during the 2018 session, which starts in January.

“In reality, however, only through legislation can we provide certainty to students, parents and our universities that the provisions we worked so hard to pass in SB 374 will be permanent,” Negron said.

“I look forward to discussing these important issues in more detail when interim committee weeks begin in September,” he added.

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