The News-Gazette

Rising tuition pushing college out of reach

Wednesday, September 29, 2010

CHAMPAIGN – The gap between what students can afford to pay for college, including scholarships, and the actual cost is about $60 million a year at the University of Illinois.

That gap grows by $16 million with every 10 percent increase in tuition, interim Chancellor Robert Easter says.

In a speech on campus Tuesday, Easter said he's worried that constant tuition increases, prompted by declining support from the state, are pushing college out of reach for many students and abandoning the UI's land-grant mission.

"I don't think society can long prosper when only a small percentage of citizens can participate in higher education," Easter said in his talk on "The Price Tag of Education" at the University YMCA.

The cost of operating the university is "enormous" – now more than $4 billion a year – and historically much of it was borne by taxpayers through state funding, Easter said. But increasingly the UI has had to turn to students for help, he said.

This year, tuition for new freshmen went up 9.5 percent, though they're guaranteed that rate for four years.

State general tax revenue makes up just 17 percent of the university's operating budget. The figure is closer to 30 percent when pension payments, health insurance for employees and scholarships for students are included, he said.

The state budget deficit is projected at $13 billion to $15 billion, and Illinois has a backlog of $6 billion in unpaid bills, including $250 million owed to the UI (half of that to the Urbana campus). The university has shifted money internally to meet payroll and other obligations, but "we can't do that forever," Easter said.

The university is trying to help cushion the blow to students by beefing up privately funded scholarship programs, with more announcements expected this weekend at the UI Foundation's annual meeting, Easter said.

It's also cutting costs through the "Stewarding Excellence" budget process, expected to save "several million dollars," Easter said, as well as voluntary retirements or employee buyouts. And an aggressive energy conservation program has reduced utility costs "substantially," he said.

But more will be needed. The university will have to make tough decisions about longstanding programs that are "dear to us," he said. On Tuesday, the campus proposed dropping academic programs in the Institute of Aviation to save up to $750,000 a year.

Easter was asked specifically about recent cuts to UI Extension, created in the early 1900s by an act of Congress and funded by a mix of local, state and federal funding. Easter, an agriculture professor, said Extension's downsizing is "hard to watch," but he can't justify using student tuition to subsidize the program when state funding declines.

The university also has to emphasize the important role it plays in the state's economic development, he said.
He cited statistics showing that when the population of college graduates in a city increases by 10 percent, overall wages rise by 7.8 percent. And cities with higher percentages of college graduates have lower employment rates.

Easter said the UI could capitalize on its extensive health care operations, groundbreaking research in genomics and expertise in computational science to create a "Silicon Valley of health" in Champaign-Urbana, resulting in research opportunities, new jobs and more tax revenue for local schools and the state.

Back in 1868, the UI didn't initially allow women to enroll, "depriving ourselves of half the state's intellect," Easter said. "I worry today that not by gender and not by race are we limiting access, but by cost."

Easter said later he's not sure what the university might do about tuition next year.

"We just have to think really hard about this question, look at affordability and ask are there ways we can trim our budget?"