Higher education financing trends… national patterns and implications for Illinois Jane V. Wellman Illinois Higher Education Finance Commission Chicago,

Higher education financing trends… national patterns and implications for Illinois

Jane V. Wellman

Illinois Higher Education Finance Commission

Chicago, IL

August 27, 2010

Topics to be covered

• Major take-aways from national research re: trends in revenues and spending

• Pricing, spending and subsidy trends• What the data say about adequacy and

equity • Recommendations about future focus for IL

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National patterns: Where the money comes from

Source: Delta Cost Project IPEDS database, 1987-2008, 11-year matched set. Note: In private institutions, investment returns include unrealized gains/losses.

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National patterns: Where the money goesOperating expenses per FTE by major category, 1998 – 2008, in 2008 $

Spending within E&R, 1998-2008 (in 2008 $)

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National patterns: Where the money goes within E&R

Illinois

Public Research Institutions: Average Subsidy/Student share of E&R Spending per student by State, 2008

Illinois/National Comparisons - Public Research Sector - AY 2008

National average Illinois Illinois Rank

E&R spending per student

$15,619 $16,282 20

State and local subsidy per student

$8,055 $7,533 28

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Public Masters’ Institutions: Average Subsidy/Student share of E&R Spending per student by State, 2008

Illinois

Illinois/National Comparisons - Public Masters’ AY 2008

National average Illinois Illinois Rank

E&R spending per student

$12,185 $13,560 13

State and local subsidy per student

$6,578 $7,203 17

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Public Community Colleges: Average Subsidy/Student share of E&R Spending per student by State, 2008

Illinois

Illinois/National Comparisons – Public Community Colleges AY 2008

National average Illinois Illinois Rank

E&R spending per student

$10,396 $7,836 46

State and local subsidy per student

$7,404 $5,422 31

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National Public 2003 2008 % change

Research sector $14,219 $15,619 +9.8%

Student share 42% 48% +14.3%

Masters sectpr $11,392 12,185 +7.0%

Student share 40% 46% +15%

Community Colleges $9,600 $10,396 +8.3%

Student share 27% 28% +3.7%

Illinois public institutions

Research sector $14,980 $16,282 +8.7%

Student Share 43% 55% +28%

Masters sector $12,750 $13,560 +6.3%

Student share 35% 48% +37%

Community colleges $7,052 $7,836 +11%

Student share 27% 31% +14.8%

Public sector changes in E&R spending per student, and in student share of costs, 2003-2008

Degrees & Certificates awarded per FTE vs. Total Funding per FTE (2006-2007)

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AL

AK

AZ

AR

CA

CO

CT

DE

FL

GA

HIIDIL IN

IAKS

KY

LAME MD

MA

MI

MN

MS MO

MT

NE

NV

NH

NJ

NM

NY

NC

ND

OH

OK

OR

PA

RI

SC

SD

TNTX

UT

VTVA

WA

WV

WI

WY

US

14

17

20

23

26

29

32

5,000 8,000 11,000 14,000 17,000 20,000

Low Resources, High Production

Low Resources, Low Production

High Resources, High Production

High Resources, Low Production

Performance:Degrees

Awarded per 100 FTE

Resources: Total Funding per FTE

Source: SHEEO State Higher Education Finance Survey 2008: NCES IPEDS Completions Survey

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Recommendations for future Illinois policy focus

• Anchor financing strategy on using resources to meet goals– Adequacy focus will always put pressure on increasing revenues in research

sector– Equity considerations and student share of costs appropriate factors to

include

• Build expectations for strategic cost management and productivity into fund management– Look for evidence of sustained investments in core functions

• Develop – and use – metrics for monitoring spending including cost-management that address subsidies, prices as a share of costs, and how resources are used

• Pay attention to state as well as institutional role in finding long-term solutions

• Include attention to private providers

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