Tuition funding outpaces state aid at Iowa public universities

Iowa last year ranked 18th in the nation for using student tuition to support public higher education.

Tuition's portion of public higher education money - including the three regent universities and 15 community colleges - was 49 percent last year. That was well above the national average of 37 percent, according to the State Higher Education Executive Officers group.

This year, for the first time, tuition dollars made up more than half of academic funding at Iowa's regent universities.

It's a common concern for public higher education leaders: how to keep tuition from becoming a larger and larger piece of the funding, as state money becomes a smaller part of the formula.

“I believe it is of utmost importance that once we come through this economic crisis, there be a renewed commitment to the funding of public higher education,” state Board of Regents President David Miles said. “What we have built is just far too important to put at risk.”

Declines in state funding this year and last year - $153 million at the University of Iowa, Iowa State University and the University of Northern Iowa - can be blamed on the global economic downturn, Miles said. Education leaders realize every state agency took hits, he said.

The competition for state dollars, especially with health care costs, and the slow decline in the state's portion of higher education budgets was happening long before the latest financial crisis, though, Miles said.

In 1981, state funding was 77 percent of the general education budgets at the UI, ISU and UNI, while tuition was 21 percent. In 2001, state funding was 64 percent while tuition was 31 percent. This year, fiscal 2010, state funding was 41 percent of the budgets, tuition 52 percent.

The remainder comes from federal funds and other sources, such as grants or, in the case of community colleges, local taxes.

In coming months, the regents will discuss the future of tuition for the UI, ISU and UNI - what it should be, how it should be set and the state's commitment as part of that formula.

“It's time for us to start looking at making progress in the other direction as the economy of Iowa strengthens,” Miles said.

At Iowa's community colleges, tuition dollars have for almost 10 years outnumbered state and local funding in fueling education budgets.

“I'd say ours is a worse situation, and it has been for some time,” said Steve Ovel, executive director of governmental relations at Kirkwood Community College.

Statewide, tuition at community colleges was nearly 49 percent of general education budgets last year, with state aid 37 percent and local property taxes about 5 percent.

At Kirkwood, tuition was 51 percent of the budget last year, will likely be about 57 percent this year and is expected to be more than 61 percent next year, with state aid dropping to about 28 percent, Ovel said.

“We're very concerned that we may get to the point where the ability to access training or education at our community colleges just becomes unaffordable ... at a time when training and education have never been more important,” he said.

It's a refrain heard nationally, as the proportion of public college budgets that come from states has declined. The share of total educational revenue derived from tuition increased from 24.5 percent in 1984 to a high of 37.3 percent in 2009.

State Rep. Andrew Wenthe, D-Hawkeye, believes the latest decline in state funding to public higher education is temporary. Education is a top priority and will continue to be as the economy rebounds, he said. State funding levels just three years ago were such that the UI, ISU and UNI had their lowest tuition increase in nearly 20 years, he said.

Wenthe, a member of the education appropriations subcommittee, also said public higher education must streamline.

“They are finding savings, and that will prevent them from having to make cuts to academic programs and put additional burdens on students,” he said. “We continue to ask them to find ways to be good stewards of the taxpayer dollars.”

Higher education leaders say they are looking for efficiencies. Kirkwood officials this year cut $3 million. The regents also have worked to consolidate services across the three universities, such as purchasing and budgeting, and talked more about such efficiencies Thursday in Iowa City.

Student leaders also have to play a role, to let officials know the importance of keeping an eye on tuition, UI student government President John Rigby said.

“A lot of students do feel the crunch,” he said. “I'd like to see us return to more state appropriations. Until then, we might have to buckle down just a little more.”