College Affordability Plans
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College Affordability Plans

Date: December 3, 2008
By: Sarah D. Wire
State Capitol Bureau
Links: Grapevine Project data

JEFFERSON CITY - MU Senior Tara Meyer is doing her best to get around the higher education system while working to pay her bills.

Meyer is working on a bachelor's degree in political science with a minor in social work.  She also works 35 hours a week as the manager for an office that coordinates various student services.

Her job forces her to take only only a few classes a semester.

"School, its far too expensive to pay for alone," Meyer said.

Meyer said she became a university employee because the school will pay for classes.

University employees can apply for educational assistance and have 75 percent of tuition waived for up to six classes.

Meyer said she takes 6 to 9 credit hours a semester to keep down her debt. She said the resulting limited course schedule has delayed her graduation by one or two semesters.

Meyer is just one of a number of students with stories of trying to balance finances with education after the state made budget cuts in 2003 as a result of revenue shortfalls.

Those budget cuts prompted student tuition increases. It was only in 2008 that funding levels for higher education were restored to the 2003 levels.

During the 2002 appropriations process former Democrat Gov. Bob Holden recommended tax hikes to help balance the budget, but the Republican-led legislature rejected his tax-hike plan.  In order to balance the budget, lawmakers passed a 10.2 percent cut in general revenue appropriations to higher education.

The funding cuts led to a series of tuition increases, which has affected college affordability.

Because money appropriated by the state was less than the rate of inflation, "institutions tried to make up some of that money by raising tuition," said Paul Wagner, Deputy Commissioner of the Missouri Higher Education Department. "There are some fixed costs that every institution has to meet like fuel and equipment."

Wagner said many colleges implemented "huge increases" in tuition in 2002 and 2003 when the higher education budget was cut.

He said after those two years tuition has increased mostly as the rate of inflation with the largest change since 1998 being at Northwest Missouri State and the Central Missouri University.

At MU, the state's flagship university, the cost of a credit hour for an in-state student has increased 51.6 percent since 2002. The cost of a credit hour increased from $162 in 2002 to $245.60 in spring 2009, according to the MU financial aid department Web site.

For out-of-state students, the cost of a credit hour increased 31.59 percent, from $467.57 in 2002 to $615.30 per hour for spring 2009. The cost per credit hour does not include various fees and additional costs that apply to some classes.

The estimated cost of tuition at MU for the 2008-2009 year is $20,600 for in-state students and $30,950 for out-of-state students, according to MU's financial aid department Web site.

In 2008, lawmakers passed a provision designed to restrict the power of higher education institutions to raise tuition above the rate of inflation. Wagner said if appropriations do not match inflation and colleges cannot pass those costs on to students "they're going to be coming up short as far as inflationary costs."

In April, the UM System Board of Curators voted to increase tuition 4.1 percent beginning with the summer semester. The increase was consistent with the rate of inflation at the time.

Missouri is one of the lowest-ranked states for higher education appropriations per capita according to a study by the Grapevine Project at Illinois State University, which ranks Missouri 47th in the country.

The Grapevine Project, which provides an annual compilation of data on state tax appropriations for higher education, ranks only New Hampshire, Colorado and Vermont as providing less per capita appropriations than Missouri.  During the gubernatorial campaign, both Democrat Jay Nixon and Republican Kenny Hulshof cited the Grapevine Project.

Although Missouri legislators increased appropriations for higher education by 6.5 percent in 2007 and by 9.9 percent in 2008, critics say the state needs to do more.

John B. Harms, former state chapter president of the American Association of University Professors and a current sociology professor at Missouri State University said the increases are not enough.

"Relative to the surrounding states we're still falling behind even though we're increasing," Harms said.

According to the Grapevine study, funding for higher education increased across the country to a national average of 7.5 percent between 2007 and 2008, while Missouri's appropriation increased 4.4 percent during the same time frame.

Appropriations for higher education have increased in the state during the last two years because money that once went to fund Medicaid became available following the cuts made by the state legislature in 2007, Harms said.

"It's a matter of prior commitment," Harms said.

Wagner, the higher education commissioner, said the national economic situation may cause the state budget to be tight. By the end of the 2008 calendar year, state tax collections were falling behind projections and behind collections in the prior year.

"Certainly there's not going to be a lot of money sitting in the state coffers," Wagner said.

Wagner said the state has not raised as much revenue so far this year as it did during the last fiscal year.

"The economy isn't in very good shape and state revenues are starting to decline," he said.

Even a budget-advocacy group acknowledged it likely will be a tough budget year in 2009.

"Its going to be very difficult for anyone to do a significant increase," said Amy Blouin, executive director of the Missouri Budget Project -- a non-partisan, non-profit  group that analyzes state budgets and encourages a public policy voice for low-income Missourians.

While college tuition costs have increased, so too has state support for various scholarship programs -- funded by the sale of assets of the Missouri Higher Education Loan Authority.

While most of the assets go for various building construction projects across the state, a portion is allocated for student scholarships.

The Access Missouri Financial Assistance Program received $95 million to disperse in the 2008-2009 school year compared to $72 million for the prior school year.

So far this academic year 39,000 students have received scholarships. Wade said the number will likely increase as the year progresses.

While the actual award amount can vary based on state appropriations and the type of school, students can qualify for $1,000 to $4,600 a year.

"Obviously we'd like to provide more scholarship money to more students," said Senate Education Committee Chair Rob Mayer, R-Dexter. "We don't provide the maximum to all students but we'd like to."

Mayer said he does not expect more money to be appropriated to scholarships because of the economy.

In addition, the loan authority, MOHELA, has scaled back its asset sales because of the recent economic downturn.

General Revenue Appropriations for higher education from 2001 to 2009 in millions of dollars.

Fiscal Year General Revenue Percent change from previous year
FY 2001 $960.5 million + 5.4%
FY 2002 $979.1 million + 1.9%
FY 2003 $876 million - 10.2%
FY 2004 $839.5 million - 4.2%

FY 2005

$862.3 million + 2.7%
FY 2006 $857.4 million - .6%
FY 2007 $889.4 million + 3.9 %
FY 2008 $936.5 million + 6.5%
FY 2009 $1,028.8 million + 9.9%