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VIII. Legislative Assignments
University Contracts
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Panel Discussion
Staff Report
Council Discussion
Tuition, Financial Aid, and
Access
Social Benefits of Higher Education
• Highest and best use of individual talent; maximize
the productivity of a society
• Increase tax revenue
• Minimize social costs that are correlated with undereducation (crime rates and dependency)
• Informed and educated electorate
• Increased entrepreneurism
• Increased technological innovation
Source: Education and the Common Good: Social Benefits of Higher Education in
Kentucky by Amy L. Watts
Higher Education
Funding Policies
• Appropriations for General Operations
• Tuition and Fee Policies
• State Financial Aid Policies
• Institutional Financial Aid Policies
• Federal Financial Aid Policies
Source: Financing in Sync: Aligning Fiscal Policy
with State Objectives (Dennis Jones, 2003)
Goals of Tuition and Financial
Aid Policies
Tuition
Source: Financing in
Sync: Aligning Fiscal
Policy with State
Objectives (Dennis
Jones, 2003)
• Affordability
• Revenue
– Access to courses and programs
– Efficiency and performance
– Quality and economic development mission
• Support differential missions and costs
Financial Aid
• Affordability
• Reward performance
• Stem the “brain drain”
When funding policies are not aligned,
the goals of higher education are not
realized:
• “Taxpayers pay more than their fair share;
• Students find higher education becoming
unaffordable and opt out; or
• Institutions fail to acquire the resources
needed to adequately fulfill their missions.”
Source: Financing in Sync: Aligning Fiscal Policy with State
Objectives (Dennis Jones, 2003)
National Trends
Tuition Philosophies of the States
Source: State Tuition, Fees, and Financial
Assistance Policies, 2002-03 (SHEEO)
2002-03
1996-97
Tuition should be as low as
possible
30%
28%
Tuition should be moderate
Tuition should be high
Tuition policy is guided at
institutional-level or no
statewide policy exists
13%
0%
37%
28%
4%
23%
Other
20%
17%
Primary Authority for
Establishing Tuition
• Legislature
4
• State Coordinating/
Governing Agency
18
• System Boards
12
• Individual Institutions
16
Source: State Tuition, Fees, and Financial
Assistance Policies, 2002-03 (SHEEO)
The Emerging Problem of
Student Debt
• The amounts students will have to repay are a rising
and significant proportion of potential earnings.
• The current growth in borrowing has not leveled off.
• Many have accumulated debt, particularly through
credit cards, that could make repaying loans more
difficult than in the past.
• Widespread consumer debt is substantial so students
are receiving less help from their parents.
Source: Student Loan Debt: Problems & Prospects by the
Institute for Higher Education Policy, the Sallie Mae Education
Institute, and the Education Resources Institute
Summary of National Trends
• A shift of policies towards an emphasis on
institutional funding needs.
• Increased deregulation of tuition decisions
by state legislatures.
• Student debt as a share of potential income
continues to grow.
Florida Tuition and Fees
$ per FTE of Research I Universities
Florida vs. Top Funded SREB States
25,000
State Support
Tuition & Fee Revenue
20,000
15,000
10,000
5,000
0
Maryland Kentucky Delaware
North
Georgia
Carolina
SREB
Average
Source: SREB 2000-2001 Funding Report
Florida
Florida
with
SREB
Avg Fees
Florida
with
SREB
Top
Quartile
Fees
Average Tuition, Fees, and Financial Aid per FTE
of 10 Large States and U.S.
7,000.00
State Need-Based Aid
6,000.00
State Non-Need Aid
Fees Paid by Student
5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
St
at
es
ni
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d
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al
if
or
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a
ia
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rg
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ew
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xa
s
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hi
o
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rs
ey
ew
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Fl
or
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U
P
en
n
sy
lv
an
ia
0.00
Sources: NCES Digest of Education Statistics 2001 and NASSGAP Annual Survey of State Grant
Programs 2000-01
Florida
Student Financial Aid
FLORIDA UNIVERSITY SYSTEM
Grants vs. loans
1,400,000,000
LOAN AID
GRANT AID
1,200,000,000
1,000,000,000
800,000,000
600,000,000
400,000,000
200,000,000
1997-98
1998-99
1999-00
2000-01
Source: Trends in Student Aid and College Pricing in Florida 1997-98 to 2001-02
2001-02
800,000,000
700,000,000
FLORIDA
UNIVERSITY
SYSTEM
600,000,000
500,000,000
400,000,000
300,000,000
200,000,000
100,000,000
NEED-BASED
AID
NON NEEDBASED AID
-
NEED
VERSUS
NON-NEED
PROGRAMS
1997- 1998- 1999- 2000- 200198
99
00
01
02
Source: Trends in Student Aid and College Pricing in Florida 1997-98 to 2001-02
Percent of Undergrads Receiving
Need-Based Aid (2000-01)
Georgia
Texas
California
10 Largest
States
Michigan
Florida
Ohio
Illinois
New Jersey
Pennsylvania
New York
0%
10%
20%
30%
40%
Sources: NCES Digest of Education Statistics 2001 and NASSGAP Annual Survey of State Grant Programs
2000-01
Problems with a Low Tuition/High
Merit Aid Strategy
• Benefits students who would have gone to college
anyway
• Reduces the price of attendance for students who
could have afforded to pay more
• Shifts costs from students and parents to taxpayers
• Unlikely to substantially improve either participation
or affordability
Source: Financing in Sync: Aligning Fiscal policy with State Objectives
(Dennis Jones; 2003)
Florida Access
Measuring Up 2002: The Stateby-State Report Card for Higher
Education
Florida Affordability Grade:
D-
Family Ability to Pay
at community colleges
Percent of income needed to pay
for college expenses minus financial
aid:
(average of all income groups)
Florida
“A”
States
• at community colleges
23%
16%
• at public 4-year
colleges/universities
23%
18%
• at private 4-year
62%
32%
STRATEGIES FOR
AFFORDABILITY
Florida “A” States
State grant aid targeted to lowincome families as a percent of
federal Pell Grant aid
16%
108%
Share of income that poorest families
need to pay for tuition at lowest priced
colleges
13%
8%
Average loan amount that all
undergraduate students borrow each $3,082
year
$2,928
Summary of Current Florida
Policies
• Current policies emphasize on low tuition and
merit aid
• These policies produce a low ranking among
states in success at providing access...
– Despite low tuition, Bright Futures, Prepaid
Tuition program, etc.
• Current Florida tuition levels provide the
state with an untapped and uncommitted
revenue opportunity
Florida
Institutional Differences
Portion of University System FTE Enrollment
Included in Contract Study
180,000
160,000
140,000
120,000
Not
Included
in Study
100,000
80,000
60,000
40,000
20,000
0
Included
in Study
Source:
SUS Fact
Book
2001-02
Headcount Undergraduate
Enrollment by Age
100%
90%
80%
70%
60%
17 to 20
21-24
25-33
34-44
45 and Older
50%
40%
30%
20%
10%
0%
UF
FSU
Source: SUS Fact Book 2001-02
USF
UCF
FIU
SUS
Percentage of Undergraduate Headcount
Enrollment
That is Part Time
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Source:
SUS Fact
Book
2001-02
UF
FSU
USF
UCF
FIU
SUS
$70,000
Personal/Health
Insurance
Clothing
$60,000
$50,000
$40,000
Transportation
$30,000
$20,000
Computer
$10,000
Meals
$0
4 Year
4 Year
Cost with Cost with
120 SCH 120 SCH
& No
& 10%
Annual
Annual
Fee
Fee
Increases Increases
51/2 year
Cost with
132 SCH
& No Fee
Increases
Housing
Books/Supplies
Tuition
Impact of
Fee
Increases
on
the Cost of
College
Source: UF annual student budget 2002-03 from UF Financial Aid Office website
Institutional Differences
• Large variation in percent of enrollment that is part
time.
• Large variation in percent of enrollment that is not
traditional college age – more likely to have family
and other responsibilities.
• 76% of SUS FTE and 75% of Headcount attend
universities are included in the study.
Overall Summary of Tuition and
Financial Aid Policies
• Current policies are inefficient in providing
access
• New policies need to balance tuition revenue
and student costs
• Contract provisions may need to be different
for each university
• Untapped tuition revenues provide an
opportunity for dramatic change