State budget: House pillages universities

Posted by T. Greg Doucette on Jun 9, 2010 in Student Government | Subscribe

The psychological trauma of losing a fifth of your classmates is still sinking in for a lot of us, so tonight’s entry is going to focus on the state budget for North Carolina since I can write about it from memory with minimal effort ;)

Unfortunately the trauma with the budget is a bit more serious…

About a month ago I mentioned to y’all the Senate’s version of the state budget and its implications for students. I was pretty happy that Senators adopted UNCASG‘s request to repeal the 8% student tax enacted last year1 — a request highlighted on Forbes.com and endorsed by Governor Perdue after petitions were signed by 22,000+ students at our 17 constituent institutions.

The catch? The Senate also authorized the University system to unilaterally approve additional tuition increases of $750-per-student to offset budget cuts :surprised:

Unlike the student tax, the universities would keep the money raised from the tuition increases instead of it going to the state’s General Fund. But with no cap at all and no approval required by a campus’s Board of Trustees or the system’s Board of Governors, it essentially guaranteed tuition rates would go up nearly $1K apiece at many campuses… a ~25% increase in a single year for UNC Chapel Hill, which is already the most-expensive University in the UNC system (the % is even higher for other universities, including my alma mater).

Needless to say that’s a huge amount for a tuition increase in a single year. Those kind of jumps force students to drop out of school.

Well the House of Representatives had their turn last week, and the Representatives seemed to be perfectly fine with that :mad:

Historically the House has been unkind to the University, using draconian budget cuts to the university system as a bargaining chip with the Senate when the budget goes to a joint House-Senate conference committee for its final edition. But even knowing that as the backdrop, I was still totally floored at how aggressively the politicians pillage the people’s universities.

You can see the House version beginning on Page 25 of the House budget report on S897. The first entry alone blows my mind: ~$150,000,000 in permanent budget reductions starting this year, on top of the ~$100,000,000 in permanent reductions that began last year. That means the Legislature is chopping a quarter of a billion dollars (with a B) in less than 2 years’ time.

Representatives apparently weren’t content there, so they decided to follow up by providing only a fraction of the system’s request for need-based financial aid — the $$ universities will have to use to help kids avoid dropping out when the Legislature’s budget cuts inevitably lead to substantial tuition increases. Then the House decided to go a step further and cap enrollment growth to 1% a year, which will exclude thousands of academically qualified North Carolina students from the very universities their parents’ taxes are financing :crack:

I’ve seen the same House-Senate budget dance play out for 11 years now, but this really has to be the single most outrageous proposal I’ve seen. It will utterly decimate each of our universities for years to come.

So back on Monday I woke up, checked my email, checked Facebook, read the news… and decided I was sufficiently pissed off that I needed to vent publicly. I prefer doing work behind the scenes when it comes to politics and lobbying, but my blood was sufficiently heated that I fired off a letter to the Raleigh News & Observer. They were kind enough to post it on their Education blog, which got spread around via email among some chambers of the Legislature.

Here’s their entry:

A student voice on UNC budget cuts
Submitted by eferreri on 06/07/2010 – 10:45
Tags: Campus Notes | Erskine Bowles | Greg Doucette | N.C. Central University | N.C. State University | T. Greg Doucette | UNC system

Greg Doucette knows better than most just how tough it can be to pay your way through college.

Doucette, an N.C. State grad and current N.C. Central University law student, recently stepped down as the president of the Association of Student Governments, the group of student leaders from across the UNC system.

In that role, Doucette served on the UNC system’s Board of Governors, where he routinely put a face to the budget-cut issue by telling his own story about struggling with tuition payments while at NCSU. He dropped out for a while, putting his college career on hold for several years.

Now, he writes of budget cuts to the UNC system proposed by both the state House and Senate. The Senate spending plan, while generally easier on the university system, still proposes a $50 million cut and would increase tuition $750.

And the House budget calls for a far larger cut. UNC President Erskine Bowles says it would result in the elimination of 1,700 jobs across the public university system.

In a letter submitted to the News & Observer, Doucette lays out his concerns.

Here it is:

It was during North Carolina’s previous recession, roughly a decade ago, when the General Assembly last considered such deep cuts to our state’s public universities comparable to those now proposed by the House. Unsurprisingly, those cuts led to dramatic increases in tuition rates (similar to the $750+ per student increase now proposed by the Senate) to make up for the losses in revenue.

Also unsurprisingly, those huge spikes in cost forced students like me to drop out of college entirely. It took me 5 years working low-wage jobs in the “real world” until I saved enough to return to NC State, where I graduated with my degree in Computer Science last year — and where resident undergraduate tuition had surged 120% from the year I started until the year I came back.

How much more tax revenue would I have contributed to the state treasury had I graduated in 2004 instead of 2009? How much more tax revenue would the many students in my situation have contributed over that same time span?

I understand legislators’ impulse to protect K-12 education and the other areas spared by their current budget proposals; this is an election year, after all. But legislators should understand the cuts they’ve proposed to the University of North Carolina will condemn many students to years of reduced earnings (especially those who live outside of the Triangle or Triad), mortgaging North Carolina’s future economic health for the sake of re-election.

Students and their parents deserve better.

With warm regards,
T. Greg Doucette

The writer is a student at the N.C. Central University School of Law, and President Emeritus of the UNC Association of Student Governments.

God bless them for using my old profile photo from when I was President of the NCSU Student Senate — and still had hair ;)

In all seriousness, I can’t be the first person to point out the effects of these types of cuts and their attendant tuition increases. I spent 5 years working as a college dropout earning a salary of someone with a mere high school diploma, when I could have already wrapped up my J.D. and been earning a lawyer’s salary; or, in the alternative, skipped getting the law degree and been working as a computer scientist.

Either way, I would have paid far more in taxes to the state in just 1-2 years than I paid over those 5. And I know of at least a dozen students who dropped out of NCSU the same semester (indeed the same week) that I did, and there were undoubtedly dozens upon dozens upon dozens more — sufficient numbers that we undoubtedly would have covered the state’s marginal cost increase for teaching us.

We’re in a recession; I realize and accept that. Budget cuts needs to be made, which I realize and accept too.

But the University system already took a disproportionate share of the budget cuts last year, and the decisions at this point are going to reduce the long-term economic health of the state — and crush the dreams of hundreds of University students who, like me years ago, will find themselves forced to interrupt their college education and search for a low-paying job just to make ends meet.

Here’s the list of legislators who are on the House-Senate conference committee. If you happen to be a North Carolina student, or you’re a taxpayer who realizes this short-term budget cure is going to cause far more long-term budget harm, please get in touch with these conferees and tell them: students and their parents deserve better.

Your support is greatly appreciated :)

That’s it from me y’all. Have a great night! :D

  1. Essentially each campus’s tuition would go up by 8%, capped at $200… but the money would go to the state’s General Fund instead of the campus where the tuition money was paid :crack: []

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2 Comments

 
TDot
Jun 11, 2010 at 5:56 PM

It was an interesting read and I agree with several chunks of it, but there are others where I’m not entirely convinced.

For example, I’ll readily concede that a portion of inflation in higher ed is the result of more widely available financial aid; the classic case of “too much money chasing too few goods”. But at the same time, a sizable portion of that increase is also a function of a dramatic and bona fide increase in demand — a realization that a high school diploma is insufficient for financial security unless you’re entrepreneurial or working in a skilled trade. Since at least elementary school for me (before financial aid was as available as it is now) I was pushed to get a college degree; I’ve got no doubt many others were pushed on a similar path. With so many people applying, a huge jump in prices was inevitable.

I’m also not intrinsically averse to college costing more overall; I actually wrote two separate columns back when I was an op/ed columnist for the NCSU Technician advocating higher rates (see http://www.phoenixwebinc.net/writings/TechnicianColumn10.html and http://www.phoenixwebinc.net/writings/TechnicianColumn12.html ). My primary concern is the *rate of increase* in those rates.

I also agree-and-disagree on student loans, a point I included as my 3rd bullet in that latter column. I’m a fan of variable rates on the loans to help limit the subversion of the market place and return at least some level of price signals for the debtors. But I’m also comfortable — as a public policy choice — with the government underwriting them in some capacity if steps are taken to limit the possibility of default (such as the revisions to the bankruptcy code that were enacted a few years ago).

There’s simply too much risk investing in a college student for a private bank to make that investment decision unless the student’s got a high credit score (of which few do), a credit-worthy co-signer (also of which few do), or the bank has some kind of loan guarantee (which they had prior to the industry being nationalized). The constant failure of more “innovative” ventures like MyRichUncle — which began with a focus on making loans based on being repaid a share of the student’s future income but became a traditional credit score-based lender — highlight that risk.

I’m not a fan of the government nationalization that took place, but I’m also unwilling to cut the government out of student loans entirely because the practical result will be to put us back where we were decades ago, with folks like me not being able to afford a higher education in the first place.


 

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