Financial Issues in Higher Education Dr. David F. Finney

Proportion of Undergraduates Receiving Financial Aid, Fall 1989 U.S. National Data

Proportion of Undergraduates Receiving Financial Aid, Fall 1989 U.S. National Data

Total Financial Aid Spending by Source

Number of Recipients and Amount of Aid Per Recipient - Selected Federal Programs U.S. National Data

Trends in Student Financial Aid: Constant 1996 Dollars in Billions Academic Year

Estimated Student Aid by Source for Academic Year ( ) (current dollars in millions)

Growth in Federal Loan Volume (1992/ /1997) Loan Volume in Billions of Constant 1996 Dollars Academic Year

Fifteen-Year Changes in Tuition, Family Income, and Student Aid (Inflation Adjusted) Percent Change in Constant Dollars: 1980/ /96

Public and Private Subsidy Per Student

Public and Private Educational Expenditures

Enrollments Subsidy Educational Net Tuition Sticker General Individual % Increase Expenditures & Fee Price Subsidy Student in Sticker Price Aid Raises Net Price

Vulnerability to For Profit Competition The Most Vulnerable: Lowest 10% Of Subsidies

Vulnerability to For-Profit Competition: The Vulnerable: Lowest 30% of Subsidies

Expected Parental Contribution for Academic Year as a Function of 1984 Family Income * Assumes a family of four with two parents, the student, and one additional dependent child.

New York State Tuition Assistance Program (TAP) Grants for Undergraduates at New York State Public and Private Colleges,

Changes in Median Family Income and College Costs:

Changes in Grants and College Costs: 1963 to 1987

Changes in Student Loans and College Costs: 1963 to 1987

Projected Changes in the Number of High School Graduates, 1995/ /2006 (in percents)

Federal Income Taxes

Share of Adjusted Gross Income

Title IV Programs: Summary Information

Federal Financial Aid Requirements

Overview of “Cost of Attendance” For most students, the statutory cost of attendance includes three basic components: –Tuition and Fees –Books, Supplies, Transportation, and Personal Expenses –Room and Board

California General Fund Appropriations (in millions of dollars)

California State Support for Public Higher Education (in dollars)

California Higher Education Participation Ratios Note: The participation ratio measures the number of FTE public college and university students divided by the number of new high school graduates

California Higher Education Student Enrollment Ratios Note: The student enrollment ratio measures the number of FTE public college and university students per 1,000 residents

California Funding for Public Higher Education ( ) In Billions

California Student Financial Aid Allocations Percent Institution-Based Aid Campus Based Aid Other Federal Aid

Average Public Undergraduate Tuition and Fees -- California State ( in dollars)

Increases in Students’ Price of a Dollar’s Worth of Higher Education to %Private Research Universities 1.8%Private Doctoral Universities 11.1%Private Liberal Arts Universities 12.6%Private Two-Year Colleges 15.5%Public Two-Year Colleges 18.0%Private Comprehensive Universities 40.0%Public Doctoral Universities 40.3%Public Research Universities 50.1%Public Comprehensive Universities 76.9%Public Liberal Arts Colleges

Revenues by Source for Higher Education

Higher Education’s Share of the U.S. Gross Domestic Product

Higher Education’s Share of Expenditures of State and Local Governments

State and Local Government Budget Share Changes Health Highways Higher Educ Welfare Elem/Sec Educ All Other Police Exec/Leg/Jud Corrections Medical Care

Higher Education’s Share of Expenditures of the Federal Government

Higher Education’s Share of Personal Consumption Expenditures

Distribution of Responsibilities for Financing Higher Education

Higher Education’s Share of U.S. Gross Domestic Product and Population

Higher Education Enrollment Rates ( )

Educational Expenditures and GDP (1989 & 1994)

Pricing Educational Programs The following objectives should be sought in pricing educational systems: –Course programming should be maximally flexible –There should be no price disincentives to discourage students from taking additional courses to enhance their education –Financial pressures on students to graduate earlier than they wish should be minimal –There should be an effort to minimize the financial distribution between scholarship and non-scholarship students

Scaled Pricing Under a system of scaled pricing, a student pays more for the first and second courses, less for additional courses up to an accepted norm This form of pricing encourages taking courses for individual enrichment, not acceleration purposes

Two-Part Pricing Two part pricing partitions tuition into two parts: –The first part fixes prices to enrolling students independent of the number of courses taken –The second part fixes prices to the individual course The fixed price requires analyzing and segregating instructional and non-instructional costs. In two part pricing, there are no additional costs to the student for acceleration

Term Pricing Under the term pricing model, a flat tuition fee is charged each term. This schedule discourages part time study but does not penalize a student who wishes to take additional courses for credit

Unit Pricing Under a unit pricing system, students are charged a set price per course This system is generally in effect at institutions with large numbers of part time commuter students

U.S. Public High School Graduation Rates

Average Annual Income by Educational Attainment for Males 25 Years and Over Educational Attainment

Average Annual Income by Educational Attainment for Females 25 Years and Over

College Attendance Rates for Recent High School Graduates

Higher Education Undergraduates Receiving Pell Grants to

Federal Family Contribution Expectations

Total Tax Revenue as a Percent of Gross Domestic Product

Average College Costs,

Range of Tuition at 4-Year Institutions,

Highest Level of Educational Attainment for Beginning Postsecondary Students by Spring 1994

Public and Private Subsidy Per Student

Public and Private Educational Expenditures

Funds and Revenues of Higher Education Institutions by Source (in billions)

Inflation -Adjusted Percent Changes per FTE Student for Selected Institutional Types

Percentage of Undergraduates Receiving Financial Aid, by Type of Institution

The Maximum Pell Grant as a Share of Cost of Attendance,