Balancing higher ed costs is top priority

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The desire to use the North Dakota's more than $1 billion surplus on many good things will be high. In terms of spending the surplus, the Legislature needs to deal with the basics education, corrections, basic health care for vulnerable citizens and roads and bridges before addressing other valid needs.

Higher education, and the need to reduce the financial burden on students, needs to be one of the budget priorities. A consensus has developed agreeing that North Dakota needs to make the state's colleges and universities more affordable for its citizens.

Recently, four state lawmakers from the Red River Valley proposed the governor freeze tuition at the state's colleges and universities. The board of higher education, in its budget proposal for 2009-11, freezes tuition for two-year schools and limits the four-year institutions to tuition increases of no more than 4 percent, and put $14 million into tuition assistance. Gov. John Hoeven suggests tuition increases might be limited to the rate of inflation, and wants to inject $40 million into tuition assistance.

The state should increase its share of the cost of a college education, reducing tuition and required fees for in-state students, but do so in a way that leads to a more balanced equation in the long term.

The degree to which tuition assistance does not cover tuition and fees, for students with need, often translates to student debt, typically $15,000-$20,000 for a four-year degree. In 2007-08, of 20,346 students who qualified for tuition assistance, only about 4,000 received it, leaving the rest to go to banks for loans.

A student's share of costs (tuition and fees) at the University of North Dakota and North Dakota State University is 60 to 62 percent. At Minot State University, students pay 47 percent of the cost. At Dickinson, Mayville and Valley City, students pay 32 to 51 percent. And at the state two-year campuses, students pay 31 to 51 percent.

There are ranges because tuition varies by institution and by the mission of those institutions. At Bismarck State College, a two-year community college, the school offers associate degrees, retraining of workers, vocational programs like power plant technology and low-cost stepping stones to four-year programs. The board of higher education wants to keep the student share of costs of these programs low. Its goal is a 25 percent student share. At UND and NDSU, students are paying 60 to 62 percent of the costs, and the goal is 40 percent.

In terms of the state share of the cost at colleges and universities, there's a big gap between reality and goal.

By comparison, tuition and required fees at UND and NDSU, in 2007-08, are 5.7 percent below the regional average for resident undergraduate students. At the state's two-year schools, North Dakota runs more than 20 percent above the regional average. Hence, the chancellor of the university system, Bill Goetz, and the board of higher education's desire to freeze tuition at two-year schools, and limit increases at four-year institutions to 4 percent. Even doing that has a price: $11 million.

Obviously, the state wants to maintain a competitive advantage in the region when it comes to tuition.

Officials and lawmakers do not have the luxury of addressing tuition, fees and tuition assistance separately. They are part of an overall budget for higher ed with increases in utility fees and wages and benefits for staff and faculty, among other growing expenses. Then there's the whole business of deferred maintenance. The level of demand for increased funding for higher education will be high, whether as set out by the board of higher education, the governor or lawmakers. It's unlikely that the student-share of higher education, and the state of tuition, will be completely addressed in the upcoming session.

Fortunately, there's a general agreement that tuition and required fees paid by students, as compared to the state share, need to come down. If not reduced at once, then in a regular step-by-step process. It will require a combination of frozen tuition and increased tuition assistance applied until an appropriate balance is reached.

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