About a month ago both The Chronicle of Higher Education and Inside Higher Ed summarize a report by the Delta Project on Postsecondary Education Costs. You can also download the actual report in PDF Format. I actually read most of this report and found it supported a trend I've observed locally at my institution- vice presidents, athletic directors, and deans have been dipping from the till to finance their own grand dreams of what a university should be.
Lets look at a few of the more enlightening findings of the Delta report:
- The report points out that "How colleges actually spend their money is barely understood by the general public and even many policy makers." I can speak to this firsthand- I have no idea where money goes or comes from, only there seems to be a lot of it floating around.
- The overall verdict of the report is that while costs are increasing dramatically very little of the money students at public institutions are paying is going to their education! "In all institutional groupings — public and private — tuition prices increased faster than education and general spending per student. This suggests that both public and private institutions are becoming more dependent on tuition as a source of general revenue — not just to pay for education and related expenses, but as a general subsidy for all functions, including research and service."
- Colleges play funny games with how they describe tuition. For example the "sticker price" of tuition is lower than gross tuition revenues. In other words colleges raise mandatory fees faster than tuition. According to the report "Institutions are also turning to user fees to fund many functions (e.g., technology fees), which have become a significant source of revenue." Again I can see this at my institution. Surprisingly students seem to simply accept these increases lying down.
- The increased tuition is going to pay for costs other than education. "In public research universities, about 92 percent of the increase in student tuitions since 2002 can be attributed to shifts in revenue, while 8 percent went to actual increases in spending." Put into actual numbers the in-state average tuition for full-time undergraduates increased 29.8% from 2002-2006 while education and general spending per FTE student only increased 2.5%.
The reason universities are jacking up tuition to fund non-education activities is that their traditional sources of funding are drying up like a slug in a salt mine. On my campus it appears to a casual observer that all the extra tuition money is likely going into a building spree. In the ten years I've been a faculty member our engineering college has built or has under construction three new buildings- two are giant research buildings of over 100,000 square feet. Other powers-that-be within the institution have also indulged- we have a new stadium thanks to Boone Pickens, several new research building, an off-campus technology park, and a multi-modal transportation facility (this is a fancy name for parking garage and bus stop). I am an engineer, not an economist, but it seems obvious that even if the building are funded completely through donations the energy to run these buildings costs money as does the staff to populate, clean, and maintain them. And at least some of the money came from bond issues, and those need to be repaid, draining more money from operating expenses.
When I was interviewing for faculty positions I was very impressed by the lab space my university had just built, but as I've grown more experienced I begin to question how much value infrastructure has without the people and culture to sustain it. The real problems I have had in doing research are always people problems, not building or equipment problems. My guess is that the great institutions are great because of their culture, not their buildings. Didn't Fermi make the first nuclear reactor under the football stadium stairs in Chicago? But it is easy to put up buildings compared to changing a culture; especially for engineers. Lets hope we can learn to address the people and cultural problems with the zeal we have for building. Time is running out.