Monday, June 04, 2007

A TABOR for UW Tuition

Chairperson for the Assembly Colleges and Universities Committee, Rep. Steve Nass (R-Whitewater), has proposed to the GOP members of the JFC a number of motions concerning the UW.

First and foremost on the list is capping tuition increases to the level of inflation, which is essentially a TABOR for tuition.

According to the press release by Nass:
Over the last ten years, the annual increase in UW System tuition has been 8.5%, while inflation has been running about 2.5% per year during that period. In 1996-97, UW System students covered only 35% of their instructional costs. Today, UW System students now pay for 58% of the instructional costs.
It's true that tuition now covers a larger portion of instructional costs. But it's also true that state GPR dollars cover a smaller portion of it. In fact, according to the LFB, while the UW System generated 34 percent of its total funding from the state in 1996-1997, only 24 percent came from the state in 2006-2007.

Yet, not once does Nass suggest putting more state money into the UW to make up even a portion of the cuts that would come through tying tuition to inflation.

And why would he? According to Nass, the difference is just waste, anyway. As he sees it:
Families in this state have no problem with paying the lion’s share of the costs of higher education. However, these families have the right to know that their hard earned money won’t be wasted on continuing the scandalous behavior and poor management that has plagued the UW System. The problem isn’t with the rank-and-file faculty and staff, it’s with the leadership of the System and it starts right at the top.
While Nass doesn't provide specifics on what wasteful scandals he's referring to, it's probably safe to assume that among the list would be the failed HR computer system and the hubbub over back-up jobs for executive level administrators like Paul Barrows.

The HR system ran up a tab of $26 million (which includes the salaries of permanent state employees who worked on the project) and Barrows was paid about $110,000 while on personal leave for seven months a few years ago.

These are troubling, indeed. And I'm sure Nass could come up with a few others to add to the list.

But I'm wondering if he could come up with enough in the past 10 years to justify the roughly $1.8 billion that an inflationary tuition cap would've cost the UW System between 1996-1997 and 2006-2007?

Yep, a little over $1.8 billion is what the UW System would be out in funding if tuition was limited to the inflation rate during each of the past ten years. You can check the math using the tuition numbers on page 18 of this LFB report and the inflation numbers on page 7 of this LFB report.

It's truly no problem to examine how we can keep UW tuition down, just as it's no problem to examine ways to keep general taxes and fees down for the state as a whole.

But we need to do so with realistic and fiscally responsible proposals that consider cost and services, as opposed to those with rigid adherence to restrictive revenue caps or uncompromising budget pledges.

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13 Comments:

Anonymous m.z. forrest said...

At some point, a decision is going to have to be made about the UW system. It isn't like the issues UW faces are unique. Your typical Catholic college is breaking the $12K mark for tuition. Relatively speaking, the UW system is still a good deal for the student. How much of a benefit the UW System outside of Madison is to the local community outside the basic employment question - that would make the schools no more valuable than a prison - is something probably worth pursuing at some point. These are more big picture questions.

As far as tenure and blown IT budgets - show me an IT budget that wasn't blown where the project had any degree of sophistication - I agree that these are not major issues, or at least they are not issues unique to the UW System. If UW is going to operate under the auspices of the State, I think evaluating the charitable function the Schools serve is proper to the State; hence, I don't believe it is improper for the legislature to constrain the revenues the UW can raise from tuition. If we were to offer to bid a concession contract for the UW system, one of the stipulations in the concession would certainly be at what rate and for what cause tuition could be increased.

June 04, 2007  
Blogger Seth Zlotocha said...

I would say there's plenty of evidence that the UW is highly beneficial to the state, not least of which is how centrally business leaders in Milwaukee are placing the growth of UWM in economic development plans for SE Wisconsin. Are you look for a harder quantitative study, such as this one for the tech college system, that estimates the amount of money the state makes back on its "investment" in higher ed?

Also, I'm a little lost on your analogy to a prison, and by your mentioning of a concession contract. The UW System is a state agency, not a concession operation; are you suggesting the state should consider selling the operating rights to a private firm?

Lastly, I agree the legislature should have a say in tuition levels. I certainly didn't argue anything different in this post. I just said it's a bad idea to institute a rigid cap (particularly one that's largely unrelated to university costs), especially without considering either a commitment to make up the funds elsewhere or explaining specifically what would be cut.

June 04, 2007  
Anonymous m.z. forrest said...

Despite having attended UW-M for a semester, I can't speak competently on its economic impact that would be proper to a university, creating industries and improving present one and adding to the civic life via the humanities. In comparing it to the prison system, I was doing the standard comparison. For example, my hometown university, Platteville, has estimated every dollar spent at UW-P adds $4 to the community. This isn't much different than the impact of Supermax on Boscobel. I think we would both agree that a university should offer the State more than just a way to divert state dollars to rural communities. As for UW-P and other state universities, UW-P in particular has many of its graduates end up in Illinois and Iowa. I can't think of one industry started in Platteville due to having the school there. With UW-Madison, I can think of the bioengineering firms that have been established. I'm familiar with the tech college study. My belief is that this has been a trend of moving training costs to the public sector. As you are probably aware, the tech schools work closely with local businesses in setting up training and degree programs to fill business needs. Given the competition between states, I'm not sure it is avoidable, but I think it should be taken into consideration.

My point in the concession commentary you seemed to grasp; namely, the state has an interest in college being accessible to all those with talent, not just those that can afford $12-$20K/year. If we can make that demand on a concessionaire, we can surely make that same demand on a quasi-state agency. If we, the State, cannot make that demand, then we should privatise the university system, because having it be a state entity isn't serving a purpose useful to the state. I think the legislator would be doing something useful by making the State colleges' purpose explicit with a tuition cap.

June 04, 2007  
Anonymous Anonymous said...

Your comparisons are simply specious. (That's the polite word.)

UWs produce more than jobs for employees. They produce graduates -- and graduates who add a lot more to their locales than graduates of prisons, wouldn't you agree?

As for how many stay in the state, campuses on the borders are not the norms. Look instead at your alma mater, UWM. It enrolls more Wisconsinites than any other campus, approximately 80 percent of its students, and a similar percentage end up staying in the state -- most of its 100,000 alumni.

And they graduate knowing how to do a lot more than make license plates. Many are entrepreneurs and employers, many of them heading the major companies in Milwaukee are UWM graduates. And not a one of them also attended Ethan Allen or Waupun.

June 04, 2007  
Blogger M.Z. Forrest said...

I hate anonymous commentators.

UW-M is an aberration. The median student age is right around 24. Of course you are going to have more staying locally, because more students have roots already in the Milwaukee area.

Maybe John Norquist can assist here. The purpose of government is not merely to replicate what the private sector does. Government has the ability of doing a lot of things better than the better sector and vice versa. You will find more Marquette grads on boards and positions of power than you will UW-M grads. That is nothing against UW-M grads. Allen Edmunds would be one example. I have nothing against the UW system. However, if we can't even ask the questions over its purpose and mission, then we have already lost the game, and it really is nothing but a glorified prison.

June 04, 2007  
Blogger Seth Zlotocha said...

UW-Platteville isn't intended to generate company spin-offs -- it's not a research university. That doesn't mean important research can't take place at the UW comprehensives -- research into bio-fuels at UW-Stevens Point is one example -- but they can't be placed in the same ballpark as UW-Madison an UW-Milwaukee because their main focus in churning out graduates, not research. And, not surprisingly, that's why the UW comprehensives cost a lot less for the state (and students) than UW-Milwaukee and UW-Madison.

You keep saying we should be asking questions about the purpose and mission of the UW System. Do you think that's not happening? It happens all the time. And, again, the state should absolutely have the ability to dictate tuition levels. What my post objected to was rigid and inflexible caps like the type that TABOR wanted to put on all governmental bodies in the state.

What's more, you don't set a mission through funding -- you fund a mission through funding. A funding cut on the level proposed by Nass would be disastrous to the mission of the UW System, which is "to develop human resources, to discover and disseminate knowledge, to extend knowledge and its application beyond the boundaries of its campuses and to serve and stimulate society by developing in students heightened intellectual, cultural and humane sensitivities, scientific, professional and technological expertise and a sense of purpose. Inherent in this broad mission are methods of instruction, research, extended training and public service designed to educate people and improve the human condition." You can find all of the individual campus missions here, and none of them are going to be realized through an inflationary cap on tuition that doesn't include a commitment to make up the lost funding through other revenue streams.

And, actually, there are a great number of UW-Milwaukee graduates on important positions in the Milwaukee metro area. A few examples of prominent UWM grads are the CEO of Harley (James Ziemer), the CEO of WE Energies (Gale Klappa), the CEO of M&I (Dennis Kuester), and the CEO of Northwestern Mutual Life (Edward Zore). And there are more. I have no idea if UWM has more prominent alum than Marquette, and I really don't even think that's something that's possible to determine objectively, but I do know that UWM is an integral part of the economy of SE Wisconsin just as it's going to be an integral part of growing that economy...at least as long as it's adequately funded.

June 05, 2007  
Blogger Dad29 said...

Entrepreneurialism has NOTHING to do with a college education, except in the cases where tech smarts are critical--e.g., the hard sciences--and even then, it's sort of a horse-race.

There are far more examples of "un-educated" entrepreneurs than of "educated" ones.

June 05, 2007  
Anonymous Anonymous said...

Well, I hate idiots who don't look up easily accessible data. You want people who sign their names? Read letters to the editor. This is a blog. . . .

To the point: UWM is not an aberration. It is a very typical campus these days in its urban location and its enrollment. The majority of college students now are not your era's 18 to 22 year olds; the majority are 24 and up. And you could look it up, rather than rely on some halcyon vision of the past (read: the Madison campus).

Simply put, how could UWM be an aberration when -- as stated above -- its 28,000-plus students include more Wisconsinites than any other campus in this state? That makes it the campus most typical of this state -- and, as stated above, a "commuter campus" is most typical of the campuses that enroll the most students today across the country.

So in this country and in this state, UWM is not an aberration -- it is, instead, the direction that this state needs to go in funding, if we ever are to catch up with other states' economies again.

June 05, 2007  
Blogger Erik Opsal said...

For the 2001-02 school year, UW-Madison received $408.3 million from the state. If state dollars had kept up with inflation, UW-Madison would have received more than $463 million. Instead we got only $424.4 million.

Of course then you have to consider the cuts in the interim. The state cut $9 million in 02-03, then $19 million, then $11 million, only to finally increase it back to a reasonable level in 05-06. Imagine if those cuts had continued.

Maybe Nass should introduce a measure to "cap" state funding to inflation. If he did, we'd actually be receiving more money than we already do.

June 05, 2007  
Anonymous m.z. forrest said...

Seth,

Unfortunately due to my response to anon, we are going over the same ground. We agree that the State has the perogative of insisting upon low tuition rates. At this point, our disagreement is whether a cap on tuition is prudent. You do not believe so. I think it is prudent. I'm not sure if you want to explore this further or not.

For the record I didn't support TABOR. Thank you for the data on the UWM grads with top level jobs in Milwaukee.

Anon,
If you want to call a recent trend in education typical, that is your business, but that doesn't make me an idiot for not subscribing to it. I will now revert to my old policy of not replying to Anonymous contributors.

June 05, 2007  
Blogger Seth Zlotocha said...

You've explained why you think the state should be able to have a say in tuition levels (it's difficult to argue against that point considering the UW System is a state agency and tuition is essentially a state fee, and certain limits on resident tuition increases are already written into state law) but you've yet to explain why you think a cap on tuition -- specifically, a cap that's tied to inflation -- is a "prudent" idea.

June 05, 2007  
Anonymous Anonymous said...

What fun! No reply shall be forthcoming? No wonder. I had no idea that one had the option of "subscribing" to facts -- or not.

Just when were you taught this option? After all, another fact is that the age of college students has been increasing for decades and hardly is "recent."

But while you opt to live in the apparently far-distant past, the rest of us will base our thinking about current budgeting on the present -- read, the "recent" data and the realities facing the UW and its students today -- as well as on projections for future needs.

That is how budgeting, not wishful thinking, is done. And the plan for the cap comes from the same sort of wishful thinkers who are not interested in the "recent" realities as well as the longtime principles of economics.

June 05, 2007  
Blogger krshorewood said...

Here's another thought.

Wisconsin is paying way too much for corrections - I believe twice as much as Minnesota which is comparable to us in demographics and violent crime rate.

How about looking at ways to melt down what we spend on prisons and transfer that to the UW system?

June 06, 2007  

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