With public higher education institutions likely to receive considerably less in state support this year, many UNC institutions are considering tuition hikes to offset the loss in revenues. The News and Observer recently reported that UNC-Chapel Hill is proposing a 6.5 percent tuition increase and NC State is proposing to increase student costs by 3.6 percent. Who should bear the costs of decreased state support? That’s a challenge UNC President Erskine Bowles confronts as he seeks to balance tuition costs against the need to preserve educational quality in an environment of shrinking resources. While tuition on many campuses will increase, Bowles would be wise to change to debate on many UNC campuses from a preoccupation with finding new revenue sources to creating new ways for campuses to harness efficiencies and opportunities.
In a recent editorial in the Chronicle of Higher Education ( subscription required), Ron Knecht, an economist and chair of the Budget and Finance Committee of the Nevada System of Higher Education Board of Regents, points out that the current budget difficulties of many campuses can help schools assess whether they have the right business model, how they might lower costs, improve what they produce and be more responsible to changing markets.
Knecht criticizes his higher education colleagues and calls on them to rid themselves of public education’s entitlement mentality and instead concentrate on performance. He writes:
When people blithely assume that education is entitled to a public support at a growth rate above that of the economy (for example when they ask to be held harmless in an economic downturn), they show they don’t understand the central facts and the public interest. Our advocates claim that higher education should be exempt from constraints on public spending because it not only benefits the person being educated but also raises everyone’s quality of life. But while spending on education does promote economic growth, so does other private and public spending: Improving one’s home raises the neighbor’s property values, spending on roads provides various benefits for many people and so on.
The upshot is that we in education have no reasonable claim on increases in the rate of public support at or above the growth rate in the economy. Whines of “underfunding” and predictions of disaster if our wish lists are cut do not change the fact. Instead we have a responsibility to do better than we have been doing.
Knecht offers a rare but much-needed perspective on the management of public higher education institutions. He offers solid guidance for how public institutions can remake themselves in challenging times. UNC administrators would do well to not only read Knecht’s piece but also implement his advice.