I applaud Gov. Tim Walz’s “One Minnesota” campaign. It suggests to me we have some work to do if we want a more prosperous state where everyone has an equal chance to get ahead. It’s hard to find fault in an agenda that promises to build bridges across political divides. Yet I wonder if Walz’s bridge-building agenda will include the divide in higher education.
Let’s face it. The playing field for higher education is tilted against the state colleges and universities. They serve more students than the private colleges and the University of Minnesota combined, charge less in tuition, and manage their budgets without the cushion of big endowments. When it comes to reform however, the Minnesota State (MinnState) schools are always expected to do more with less.
Why is MinnState ground zero for change?
Shouldn’t all three systems (the U, private colleges and MinnState) be at the table? We would insist on it in any other context. When Major League Baseball needs fixing, we don’t expect a remedy from the Minnesota Twins’ dugout. So why is MinnState ground zero for change?
MinnState was born to reform. It was built on the state technical colleges, community colleges, and state universities, some with roots in the 1850s, and as the new system was put in place in 1995, it was a symbol of change. Starting with an administrative hub in St. Paul, the system quickly expanded its control to over 30 colleges and 7 universities. Centralizing campus operations – even where it shouldn’t – in finance, technology, personnel systems, and curriculum review, MinnState became the poster child for organizational tinkering. Sadly, no governor, from Arne Carlson to Mark Dayton, had the courage to put reform on a larger statewide agenda.
Three currencies of system success
There are three basic currencies of system success in higher education: tuition, state support, and endowments. With MinnState, private colleges, and the U all possessing different ways to manage these currencies, the result is a contest where winning is more about accumulating these currencies than about education.
The private colleges rely heavily on tuition. At an average of about $30,000 per year, tuition can exceed $50,000 at Carleton and Macalester Colleges. When private colleges decide (if ever) to hold off on tuition increases, they can count on multimillion-dollar endowments to smooth over hard financial times. Most private endowments are less than $100 million, but some are several times that amount, with Carleton topping out the system at $850 million. Since the Minnesota Constitution does not allow direct public funding of sectarian education, private colleges are limited to indirect state support, which they get in spades.
No modern governor favored the private colleges more than Harold LeVander. In his 1969 address to the Legislature, LeVander described declining enrollments in the private schools and colleges as an “immediate, sometimes intolerable burden on the taxpayer, who must then provide many more public facilities, teachers, and administrators.” In the same year, the Legislature put taxpayer dollars toward developing new student aid programs for all Minnesota students. The eventual result was the Minnesota State Grant Program.
The State Grant Program today delivers over $194 million in student aid. Thirty-three percent of its dollars go to the private colleges enrolling only 15 percent of the state’s students. Similarly, for every dollar going to MinnState university students, nearly two dollars are going to private college students. The reason for this is that student awards are proportionate to the attendance costs of the school that students attend – pricier choices lead to bigger awards. The private colleges doubly benefit from the subsidy because the aid represents savings in what would otherwise have been drawn from private sources to support low-income students. This is a good deal for promoting high-cost institutions and not so much for MinnState.
Equal and fair are worlds apart
The terrain of the University of Minnesota is very different. The Minnesota Constitution provides the U with “constitutional autonomy.” This means that once the Legislature has chosen the U’s Board of Regents, the latter is free to manage the university with little interference. Like the private colleges, the U of M can set its own tuition without fear of legislative caps or freezes, which today stands at approximately $14,000 per year. It’s also true, however, that the Legislature sets the appropriations for the U, and through a legislative norm called “parity,” lawmakers normally set the appropriations of the U of M equal to that of MinnState (or vice versa). This is a case where equal and fair are worlds apart, as MinnState serves about twice as many undergraduates as the U of M system. If that isn’t enough to show an uneven playing field, the U also has a whopping $3.5 billion endowment to help survive enrollment declines or slippage in state appropriations.
MinnState has no financial safety net comparable to the privates and the U. MinnState trustees approve campus tuitions, but without the autonomy of the privates or the U, the Legislature approves state appropriations after the system presents its projected tuition increases, and after the parity with the U is sorted out. In the end, Legislature-imposed or trustee-imposed tuition limits on the campuses are always a possibility. With no real endowments to soften the blow, and college tuition at approximately $5,000 per year and $8,000 per year at the state universities, MinnState campuses are running dangerously lean. Making matters even worse, the Legislature has retreated on its 1994 promise to pay for two-thirds of the operation of the public systems, leaving all public systems more dependent on tuition, more students dependent on aid, and fewer students becoming financially independent for decades to come.
Today MinnState campuses face serious challenges. Student debt is at a record high, and enrollment is stagnant. As LeVander had hoped, tax relief has trumped public investments in education, and some believe that public higher education should become the job training centers for Minnesota business. We only need to look to Washington to see what can happen if our citizens (and our leaders) don’t get a chance at excellence in higher education.
Walz has delivered a powerful message for “One Minnesota,” and maybe MinnState will be given fair chance at being part of that too.
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