State Funding, Tuition and Costs for Higher Education

From Dr. Ben Wither’s UGE Weekly Notes Reading for the Week:

According to a report from the Pew Research Center, “The earnings gap between young adults with a bachelor’s degree or higher and those without has never been greater in the modern era, despite soaring student debt and high youth unemployment. In 1979, when the first wave of Baby Boomers were the same age that Millennials are today, the typical high school graduate earned about three-quarters (77%) of what a college graduate made. Today, Millennials with only a high school diploma earn 62% of what the typical college graduate earns.”

However, as a recent article in the Washington Post demonstrates, the benefits of higher education are increasingly borne by students and their families following the economic downturn of 2008: “The recession taught legislators that families will bear the cost of higher tuition, so that sent a signal to the state that it is possible to transfer the buck,” said Sara Goldrick-Rab, a professor of education policy at the University of Wisconsin-Madison. “Now there is little incentive to reinvest.”

Slide 5 of Senate Report showing State Support for UK over time

Slide 5 from UK Senate Report, March 2014

The Post article includes a link to a study released by Center on Budget and Policy Priorities that shows that state funding for higher education per student (adjusted for inflation) has declined in across the country. Only two states—Alaska and North Dakota—are spending more now per student than before the recession. The Commonwealth of Kentucky is spending 25.4% less per student in 2014 than it did in 2008.

Slide 6 from UK Senate Report, March 2014

Slide 6 from UK Senate Report, March 2014

Last March, President Capilouto presented a report to the University Senate outlining how the reductions in state appropriation have impacted the University (see slides 5-7 in particular). The shift in total public fund revenue sources is clear: in 2004-05 gross tuition and fee revenue from the state made up only a little more than a third of UK’s operating budget. In 2013, UK depended on tuition and fees for over half the revenue for its operating budget (56%).

Slide 7 from UK Senate Report, March 2014

Slide 7 from UK Senate Report, March 2014

This drop in state appropriations is most vividly depicted in slide 5 (click on the thumbnail image above to enlarge for viewing) of the President’s report in March 2014.

An analysis of the average impact on UK students for out-of-pocket spending on tuition and mandatory fees as well as an analysis by income quartile can be found here.

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About UK Student and Academic Life

Undergraduate Education is now recreated within the Division of Student and Academic Life in the Provost's Office at the University of Kentucky.
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