Who exactly pays for UVU?
Recently the National Center for Higher Education Management Systems reported that “the Utah System of Higher Education remains one of the most cost-effective systems in the country.” This finding is based on the generation of degrees per dollars spent, in which Utah ranks third nationally. As one of the largest providers of higher education in Utah, UVU contributes heavily to the System’s efficiency and has a reputation among state leaders as being a “lean, mean, educating machine.” But how does this efficiency impact taxpayers and students?
In 2009-10 (the most recent available data), UVU received and spent $3,161 per full-time equivalent student (FTE) in state tax funds. This amount is down nearly $1,000 per FTE student from 2007-08, and it’s the lowest for any four-year institution in the state. In addition to operating funds, the state also provides critical tax fund support to construct facilities, including the Science building currently under construction.
While tuition and fees at UVU are roughly equal to that of Weber State and somewhat lower than SUU (institutions with similar missions), UVU students pay more than 60 percent of the cost of their education in the form of tuition (the highest percentage in Utah). Just three short years ago, this ratio was roughly 50/50. (See Chart 1.) Recent tax fund cuts, combined with increased numbers of students and tuition increases, have shifted this revenue picture.
What costs do tuition and tax funds cover? UVU is primarily a human asset organization; thus, more than 83 percent of operating funds are expended on salaries, wages and benefits. Instruction, academic support, and library expenditures account for more than 61 cents of every dollar spent. In other words, taxpayers and students support the primary mission of UVU — teaching. (See Chart 2.)
What about the “rising costs” of higher education? Much is written nationally about this subject. But which “costs” are these articles referring to? At UVU, expenditures per FTE student have decreased from a high of $8,200 in 2007-08 to $7,184 in 2009-10. This decline nearly mirrors the decline of tax fund support. So, in UVU’s case, I believe we can rule out the “costs” to the taxpayers and the “costs” as reflected in expenditures per FTE student. What’s left is the “cost” to students via tuition. (See Chart 3.) In order to maintain quality and access amidst these significant tax fund reductions, UVU (and other institutions across the state and nation) have both decreased expenditures and increased tuition. At UVU, tuition has increased 31.5 percent (roughly 8 percent per year) since 2007-08.
Yes, the “cost” for students (reflected in tuition) is increasing. No, the “cost” for taxpayers (reflected in tax funds per FTE student) is not increasing. And, no, the “cost” of programs and services at UVU (reflected in total expenditures per FTE student) is not increasing. Rather, the burden for funding higher education is shifting from taxpayers to students and institutions are maximizing resources to control costs and provide quality educational experiences. While this revenue shift and tuition increase may be disheartening, UVU’s tuition ranks among the lowest in the nation. High efficiency and low tuition spell value for UVU’s students!
Charts from the 2011-12 Operating Budget Submitted to Board of Trustees 6.16.11 (pdf download)