S.C. Statehouse Report
Sunday, Feb. 26, 2006

VIEW: http://www.statehousereport.com/columns/06.0226.tuition.htm

State higher ed tuition caps may be misplaced
By Andy Brack
Publisher
SC Statehouse Report

FEB. 26, 2006 - - A quiet but growing debate at the Statehouse is over whether the state should cap tuition increases at the state's public colleges and universities.

Proponents like Gov. Mark Sanford say caps are needed to keep the cost of college affordable for South Carolina students. Opponents say caps are no better than price controls that meddle in the marketplace.

Today's tuition rates are about twice what they were five years ago at most state public colleges and universities. For the first two of those years (2001-02 and 2002-03), the state tied tuition hikes to the national Higher Education Price Index, which allowed an increase up to a certain national average plus a few more dollars. In 2002-03, for example, rises were permitted to the HEPI level plus $250. But since then, there have been no caps.

Even with the semi-cap and then with no cap, tuition rates have gone up pretty dramatically. At Clemson, tuition was $5,090 in 2001. The next year with a semi-cap, it rose to $5,834 annually, followed by no-cap raises in the following years to $6,934 (03-04), $7,840 (04-05) and $8,816 (05-06). At the University of South Carolina the rise was similar, but not as dramatic, with tuition set at $4,260 in 2001-02. That figure rose by more than $3,000 to $7,314 in five years.At teaching colleges, two-year regional colleges and technical colleges, the stories were the same - - rises of 66 percent to 145 percent over the five-year span.

But tuition makes up only about 20 percent of what funds colleges and universities. Just as tuition has been rising, state support of public colleges and universities has dropped dramatically. Clemson, for example, got $103.6 million in state support in 1999-2000, compared to $85 million in 2004-05; USC suffered a similar 17 percent drop in state funding.

So what does all of this mean? It means that as the state took away money with one hand, colleges and universities raised tuition with the other to make up cuts to keep the quality of education they provided about the same.

It also suggests the state needs to take a serious look at how it funds higher education. But instead of artificially capping tuition, it might be better to more fully fund base-level support to keep tuition rises in check.

Just look at how South Carolina differs from North Carolina, a state with a great tradition of big financial support on the front end to higher education. According to a recent story in the Rock Hill Herald, the overall cost to educate a student at Winthrop University in Rock Hill is about the same as it is at the nearby University of North Carolina at Charlotte - - $12,000 a year. At Winthrop, tuition is about $8,700 while the state provides about $3,500 in support per student. Across the state line, however, the figures are almost reversed - - state support at UNC-C is $8,500 annually, while tuition is $3,500.

In other words, consistent front-end support of higher education and a state political commitment to higher education has allowed North Carolina to keep tuition very affordable. In North Carolina, higher education is a priority. In South Carolina, it's much lower on the totem pole.

So Sanford's populist, TV-sound bite pleas for tuition caps sound good in an election year. But when you realize recent budgets by the governor and legislature have cut base funding to state colleges and universities, you've got to scratch your head and wonder what's going on.What's particularly vexing is the whole concept of price caps in light of the holy Republican mantra that generally guides policies - - that the marketplace, not the government, should determine cost. It seems pretty hypocritical to push for limited involvement of government just as they're seeking to use government's power to push a populist measure on tuition.

Another thought - - if recent tuition hikes were so bad, then one would expect students to overreact and for the state's colleges and universities to suffer in enrollment. At Clemson, rated recently as one of the nation's top 25 values in public colleges, that's surely not the case.

Over the next few weeks, state lawmakers will look at whether to implement some kind of caps during the budget process. Stand-alone legislation on caps appears doomed, according to various sources. So perhaps they really ought to focus on the longer term - - and ways to provide more front-end support to colleges and universities so they aren't forced to jack up tuition to maintain quality.