Latest report: States still failing to fund higher ed at pre-recession levels

State funding rises, but remains lower than before the recession

State and local appropriations for higher education have increased slightly over the past three years, but the funding remains lower than pre-recession levels, according to an annual report from the State Higher Education Executive Officers (SHEEO). 

Spending rises, enrollment falls

Forty states increased higher education spending for the 2015 fiscal year, raising per-student spending to about $7,000 on average. The figure marks a 5.2% increase from the previous year. Also in 2015, more states raised spending-per-student than in the past 25 years.

Part of the reason spending-per-student rose is that enrollment declined slightly. The number of full-time equivalent students fell slightly more than 1% between the 2014 and 2015 fiscal years and declined about 2% since 2010. In spite of these declines, enrollment remains about 9% higher than it was before the recession.

Even though states spent more in 2015 than in 2014, they still spend 15% less per student on average than they did before the recession. Just five states spend more per student than they did in 2008. 

How the conversation about state funding needs to change

A separate analysis from SHEEO found that Louisiana spent about $1,300 above the national average in 2008, but by the 2015 fiscal year, per-student spending fell more than $1,400 below the national average. Alabama, Florida, and Nevada have also experienced similar reversals in state appropriations.

Effect on tuition

Across the country, colleges raised tuition by an average of 2.5% in 2015. Colleges are relying less on tuition than they did two years ago, with tuition representing only 46.5% of revenue per student. However, that's still 11 percentage points higher than before the recession. 

Determining tuition increases in an era of declining public appropriations

And in 22 states, tuition accounts for more than half of per-student revenues at public institutions. But this reliance on tuition dollars reflects "a true challenge not just to the students and their families but to the states that will rely on their college graduates to help sustain civic and economic vitality," says Bob Donley, executive director for Iowa's Board of Regents (Kelderman, Chronicle of Higher Education, 4/27). 

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