Dive Brief:
- State funding for higher education rose modestly between the 2017 and 2018 fiscal years, but the gain was the smallest in the last five years and was concentrated in three states: California, Florida and Georgia. (State funding for higher ed increased from 2017-18 to 2018-19, however, and the most recent Grapevine data can be found here.)
- Overall state fiscal support increased 1.6% from 2017 to 2018, following a 4.2% gain from 2016 to 2017 and annual increases of 2.4%, 5% and 5.9% in three years prior, according to the annual Grapevine report from the Center for the Study of Education Policy at Illinois State University and the State Higher Education Executive Officers. Overall, state funding is up 20.7% from 2013.
- While three states saw big jumps from 2017 to 2018, funding rose just 0.2% across the remaining 47 states. In more than two-thirds of states, funding fell at rates between 0.1% and 14.6%. Ten states doled out less funding in 2018 than in 2013, led by Oklahoma (20.6% less), West Virginia (14.5%) and Alaska (12.2%).
Dive Insight:
A report from the Center on Budget and Policy Priorities published in October argued states should increase funding to public colleges and universities and direct it toward students with the greatest need.
State funding cuts have been found to lead to higher costs for students, and so colleges are using a range of tactics to try to lower them. Among them are laying off faculty and staff members, reducing tuition, fundraising more, recruiting out-of-state students and forging private sector partnerships.
Last year, the University of Illinois at Urbana-Champaign announced it would offer free tuition and fees to qualifying state residents whose family incomes were at or below the state median. Its goal was to make Illinois' public higher education system cost-competitive with out-of-state options, which often use hefty grants to lure students.
Meanwhile, capital campaigns at public and private universities are hitting record highs.
The University of Michigan raised $5 billion in a single campaign, which started in 2011 and included at least four gifts of $100 million or more. Meanwhile, the University of Washington is chasing a similar figure, and the University of North Carolina at Chapel Hill is aiming to raise $4.25 billion.
Harvard University set an overall fundraising record last year with its $9.6 billion campaign. The university broke the previous record, and its own goal, by more than $3 billion.
Colleges are also compensating for public funding shortfalls by striking deals with private sector partners to provide some combination of financial support, access and expertise.
Foxconn — an electronics maker that Wisconsin offered $3 billion in tax incentives to build a factory in the state — granted the University of Wisconsin-Madison one of its largest gifts ever last year. The company gave the university $100 million, which it must match, as part of an agreement that requires UW-Madison to establish a research center near the site of the expected factory, about 100 miles from campus.
