Opportunity Cost: Mizzou Cuts

While the budget for the upcoming fiscal year is not yet finalized, there is at least one certainty: Funding for higher education will be cut — it’s just a matter of how much.

Missouri lawmakers have approved a spending plan that cuts core funding for public colleges and universities by more than six percent.

UM System President Mun Choi has said he expects about $30 million in state funding to be cut from the UM System’s core budget.

Declining state support is a trend that’s not unique to Missouri. In fact, it’s happening all across the nation.

“Lower levels of state support that lead to higher tuition is a phenomena we’re seeing all across the United States,” UM System President Mun Choi told ABC 17 News.

Meanwhile, students are feeling the effect of the state’s declining support as the burden of paying for higher education shifts from the state to the student.

“It’s terrifying. I mean, my dad is still paying off his student loans from law school, and the price has only gone up,” Sam Willoh, a junior who’s studying political science at the University of Missouri, told ABC 17 News. “Grad school would be very expensive and it would affect me long term.”

Since the recession in 2008, state spending per student has decreased in almost all 50 states.

There are a handful of states that have been hit with larger cuts, but state support for higher education has been on the decline in Missouri since the early 2000s.

“Over the past 10 years, we’ve seen an increased amount of burden shift from the state to students and parents. So, what we see is a lot of students coming in with limited funds and they need to depend on federal student loans, or they need to depend on parent loans to really make the cost up that the state has really cut back,” Nick Prewett, director of financial aid at the University of Missouri said.

The UM System says Missouri ranks 46th in per capital funding for higher education. In our neighboring states, per capita state spending is significantly higher.

“What we’ve seen is the average amount of student loan debt grow,” Prewett said. “This year, our average student loan is about $23,000.”

Chairman of the House Budget Committee Rep. Scott Fitzpatrick said Medicaid is higher education’s biggest competitor in terms of the budget.

“Entitlement spending is growing faster than state revenues,” Fitzpatrick said. “We were on a collision course [with Medicaid] and we finally had a collision that required us to make hard choices. We’ve tried to make higher education a priority, but when it comes down to having to make a decision between paying our Medicaid bills or spending on discretionary things like higher education, we have to pay our bills.”

Some say another contributing factor to the declining state support is the 2015 protests at Mizzou.

“A lot of the funding cuts, politically, was reactionary to some of the events that happened on the university. And I think Mizzou still gets a lot of bad press for that,” Willoh said.

Asked point-blank if there’s still resentment in the legislature over the unrest on campus that made national news, Fitpatrick replied, “Yes, I think there is… I would like for us to get through a couple months without there being a story about something stupid the university did. That would help.”

As for Choi’s response to Fitzpatrick’s remarks? “I’ve heard that as well. Not only from the legislators, but also from the public,” he said. “My response has been that I understand why they may feel that there is still some resentment for the university. But, if the resentment is shared by cutting our budget, I’d like to ask you to reflect on the impact to our students who we are educating in this state. Because with cuts, there’s going to be less faculty members, less classes, less opportunities for our students to succeed.”

One way for the UM System to generate more revenue is by raising tuition. A 2.1 percent increase for instate students has been proposed.

For MU students, the proposal means the per-credit hour rate would increase by $5.80. Interim Vice President for Finance Ryan Rapp has said the proposed tuition hike would bring in about $14.4 million in additional revenue. It’s also within the limitations set by Senate Bill 389.

Compared to other states, Missouri has kept tuition incredibly low. Over a six-year time period, tuition at public four-year colleges has only increased by about 7 percent. Compare that to Arizona, where tuition is up by 83 percent.

“One of the challenges that we have as an institution is that we control tuition. We don’t necessary control the expenses; grocery expenses, apartment expenses, transportation expenses, all those factor into the cost of attending an institution,” Prewett said. “So while you’ve seen our tuition gradually increase, we’ve seen other expenses in this region of the state also increase substantially. So we’ve seen the total cost of attending college go up.”

So, who should pay for higher education? That all comes down to who you ask.

“The state support for higher education institutions is optional, quite frankly,” Fitzpatrick said.

“I think if we’re cutting discretionary funding and we limit the amount that we’re putting into higher educational, I think that it has somewhat of a domino affect in the future with our less skilled less able workforce,” Prewett countered.

While the state works to balance its budget, students and parents are feeling the effect.

“Unless something drastically changes soon, we’re going to only see this get worse, because parents who have dept now aren’t paying for their kids’ school,” Willoh said.

Fitzpatrick, meanwhile, suggested that Missouri lawmakers look at a different way to fund higher education.

“Maybe we need to look at a better way to fund higher education and maybe the best way to do that is to empower the students through scholarships to make the decisions,” he said, “And maybe that’s something we should look at.”

For more on how President Choi plans to move the system forward, take a look at some of our past coverage.