LSU Tuition Proposal Is A Good First Step

Education funding seems to be taking center stage in Louisiana now, as Gov. Bobby Jindal met with higher ed muckety-mucks on Tuesday and stakeholders in public K-12 education yesterday to talk about how the state will fund its public schools amid declining revenues and a $1.6 billion budget deficit.

For all the howling from Louisiana’s academic Left, who have demonized the Governor as destroying the state’s universities while searching for his next TV appearance, there has so far been precious little in the way of viable alternative proposals. The most frequent idea thrown around by the academic community is the restoration of the punitive Stelly tax plan that voters finally convinced the state legislature to get rid of a couple of years ago. Recent polling indicates that new taxes are a non-starter in an election year and proposing them to fund higher education is a very good way to get clobbered next November.

But it wouldn’t be accurate to say there’s a consensus for gutting higher education, either. Almost everybody wants to see Louisiana’s system improve its graduation rates and generate better performance. The challenge is to accomplish those goals within the parameters of less resources from the state general fund.

That’s why the plan released by LSU this week to remodel tuition rates at public universities in Louisiana is a good place to start in order to find a workable compromise. The LSU plan calls for tuition hikes and fee increases to cover some $222 million of the budget hole, patch in some federal funding and in so doing limit what looms as a $438 million budget nightmare to a more manageable $107 million haircut. $60 million of the tuition hikes are already in the state’s plans, meaning $162 million would need legislative approval.

The yearly tuition increases would range from $463 at the state’s technical schools to $1,555 at LSU, which would put a year of tuition for a Louisiana resident at the state’s flagship at $4,440 according to this fall’s tuition schedule. Nonresident tuition would move to $9,832. The tuition increases would not be covered by the TOPS program, according to the plan.

“It’s no longer possible for the state to pay for the full benefit of education off the tax base,” LSU system president John Lombardi said. And he’s right about that. What’s more, it’s in the interest of Louisiana’s higher ed institutions to derive a larger portion of their funding from tuition rather than the state’s general fund. After all…

• Funding from tuition aligns the interests of the university more properly with those of its customers, the students. Higher tuition will require a greater commitment from the student, and with more at stake it’s reasonable to assume a greater effort toward academic performance and achieving a degree from those enrolled.
• Conversely, the student paying more of the freight will have a greater interest in responsiveness from university administration in terms of course offerings, quality of instruction, atmosphere and so on – and if the state’s universities don’t provide for those needs they will get immediate feedback in both enrollment figures and the quality of their student applications. Those market signals offer far more useful information about performance than top-down pronouncements from state legislators or Board of Regents and system-board honchos.
• But perhaps most importantly, universities funded through tuition rather than an “investment” from politicians are largely insulated from the political winds. The state budget is notoriously volatile, particularly in Louisiana where rather than stable property taxes a larger percentage of the revenues are generated through income and sales taxes and mineral royalties. Our history indicates that state funding swells in good times, with universities responding by building human infrastructure that becomes unsustainable in lean times when budgets decline. This has had negative effects on all the state’s institutions, but particularly on LSU – where the academic stakes are higher and the demands are greater.

Higher tuition is not going to be popular as a solution among the state’s students and parents. But when Louisiana’s public universities are generating a woeful 39 percent six-year graduation rate, some of those students who are in poor academic and financial shape to achieve a degree need to re-examine what they’re doing in the first place. Not every decent-paying job in Louisiana requires a college degree, and there are some 65 community and technical colleges which can better prepare young adults for a career than two years with no degree at a Southeastern Louisiana or UNO can. Students who fail to graduate from Louisiana’s public universities haven’t just wasted their own tuition money; they’ve also wasted taxpayer resources which are no longer in abundance and likely won’t be again.

But the main reason why moving the funding needle toward tuition and away from the general fund makes sense is that education in Louisiana is far too politicized. With 14 four-year institutions in a state which struggles to justify more than eight or nine, and with five higher education boards when no more than two should be sufficient, the patronage,bureaucracy and waste our politicians have built have dragged down the quality of the end product for two long. It’s time to move away from that system and allow our colleges a greater ability to compete with each other. Markets can improve public higher education; politics cannot. The sooner we recognize this fact, the faster we can move toward building a system which is sustainable and competitive on a national level.