affordability of postsecondary education in colorado

Affordability of Affordability of Postsecondary Postsecondary Education in ColoradoEducation in Colorado

University of DenverForum on the Future

of Colorado Higher Education

March 2, 2007Denver, Colorado

David Longanecker,Executive Director

Western Interstate Commission for Higher

Education (WICHE)

Affordability Affordability –– Affordable for Whom?Affordable for Whom?

Affordable to students & their parents

Affordable to the State of Colorado

Affordable to the Institutions in Colorado

You don’t have affordability if higher education isn’t affordable to all three of these stakeholders

Is Colorado Higher Education affordable Is Colorado Higher Education affordable to its students & their parentsto its students & their parents

What does affordable mean?On Price (Tuition)

Olden days – inexpensiveThe egalitarian era - choice

“self pay” – moderately expensive“state subsidized” – inexpensive (ala the olden days)“state subsidized” – cheap

On Student Assistance -- A shift in philosophy, as well.

From removing barriers and hindrances to attendance (need-based aid)To reducing the burden of attendance (merit aid, tax-credits, and loan subsidies)

How How ColoradansColoradans fare on affordabilityfare on affordability

Measuring Up 2006 gave Colorado on “F”But 42 other states also received an F???Yet, important evidence presented

Share of income required ( 2006) to pay average net cost is relatively high in Colorado & increasing.

23% for community college27% for public 4 year college/university66% for private 4 year college/university

How How ColoradansColoradans fare on affordability fare on affordability (continued)(continued)

Measuring Up 2006 – additional important evidence

Coloradans rely more heavily on loans:Average loan amount in Co -- $3,654Average loan amount in top states -- $2,619

State need-based aid is wanting:Colorado/Federal Investment: 34%Top States/Federal Investment: 89%

How How ColoradansColoradans fare on affordability fare on affordability –– a a focus on financial aid alonefocus on financial aid alone

Through 2004-2005 (last year for comparative data --source (NASSGAP):

Need-based aid:$48.7 million (21st nationally)152% increase over ten years (19th nationally)$274 per FTE

3rd in the WICHE RegionWICHE average: $386National average: $446

Overall:Not an unusual story:

11 of 15 WICHE States have need-based initiativesAt least two have surpassed Colorado since 04-05 (Oregon and Wyoming)

CAVEAT: Financial aid is only part of the story

How How ColoradansColoradans fare on affordability fare on affordability –– a a focus on tuitionfocus on tuition

Not bad when comparing ratio of tuition and fees to median household income

Comm Col B&M Col Doctoral Univ

Colorado 3.4% 5.7% 7.3%(ten yrs ago) 3.3% 5.2% 6.7%

WICHE 4.2% 7.2% 8.6%(ten yrs ago) 3.1% 5.3% 6.4%

Not bad in absolute termsNot bad in comparative termsNot bad in temporal terms

How How ColoradansColoradans fare on affordability fare on affordability –– a a focus on tuitionfocus on tuition

A mixed bag when comparing actual amounts (06-07)

Comm Col Public Four Year

Colorado $2377 $4404(ten yr inc) 85% 76%

WICHE $2237 $4351(ten yr inc) 85% 80%

U.S. $2272 $5836(ten yr inc) 55% 96%

Community Colleges about averageFour year institutions about average in West and below national average – and rate of

growth in tuition below averageBut neither of these reflect actual advertised price (before COF discount)

How Colorado (the State) fares on How Colorado (the State) fares on affordabilityaffordability

One the One HandU.S. spends as much as anyone else on higher education

First in total spending as share of GDP – 2.6%(Nearest others are Korea, Chile, and Israel)Eighth in public spending as share of GDP – 1.2%(Trailing Denmark, Finland, Sweden, Norway, Belgium, Israel, and Greece)Third in private spending as share of GDP – 1.4%(Trailing Korea and Chile)


One the Other Hand – We’re in Colorado

Higher Education is very affordable to the State

State & Local Public Higher Education Support per Full State & Local Public Higher Education Support per Full Time Student (NCHEMS/SHEEO)Time Student (NCHEMS/SHEEO)

State & Local Support for Public Higher Education State & Local Support for Public Higher Education Operating Expenses Per Capita (NCHEMS/SHEEO)Operating Expenses Per Capita (NCHEMS/SHEEO)

State & Local Support for Public Higher Education per $1,000 of State & Local Support for Public Higher Education per $1,000 of Personal Income (NCHEMS/SHEEO)Personal Income (NCHEMS/SHEEO)


One the Other Hand – We’re in Colorado

Higher Education is very affordable to the State

Tax Effort (NCSL)CO tax revenue as % of Personal Income = 9.2% (rank: 44th)US tax revenue as % of Personal Income = 10.2%CO share from state versus local = 49.8% (rank: 48th)

What A Deal Higher Education is for Colorado

How Colorado’s Institutions of Higher How Colorado’s Institutions of Higher Education fare on affordabilityEducation fare on affordability

State Appropriation per FTE studentCommunity Colleges (2004)

Colorado: $7,622WICHE: $6,684Rank: 9th of 15But . . .

Baccalaureate/MastersColorado: $9,742WICHE: $12,865Rank: 14th of 15

Research/DoctoralColorado: $19,772WICHE: $32,736Rank: 14th of 15

Bottom Line on Affordability of Higher Bottom Line on Affordability of Higher Education in Colorado TodayEducation in Colorado Today

To students and their familiesAffordable to middle and upper incomeNot affordable to low income

To the stateMore than affordable – very affordable

To institutionsNot affordable – jeopardizing both access and quality

How about affordability of higher How about affordability of higher education in Colorado in the Future?education in Colorado in the Future?

Life during the “C” change.

Homeostasis at bestEnrolment demand to roughly match funding growthNature of the growth from most educationally challenged populations.

The Growth in DemandThe Growth in Demand


Life after the “C” change.

The Perfect stormLimited funding for growth, let alone catch upRapid increase in demand.Nature of the growth from most educationally challenged populations.

The Growth in DemandThe Growth in Demand


Consequence

Access and quality at risk, unless:

One is sacrificed for the other

Resources are made available to sustain quality and accommodate growth.

The alternative – self satisfaction to non-competitiveness


It’s our choice

Change direction, or

Enjoy slip sliding away.

affordability of postsecondary education in colorado

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