1. Recession, Retrenchment and Recovery State Higher Education Funding & Student Financial Aid Sponsored by the Lumina Foundation for Education SHEEO Professional Development Workshop August 16, 2006

2. The Problem: National Trends since 1980 FTE enrollment in public institutions has grown by more than 40% since 1980. Enrollment growth since 2001 has already outstripped that of each of the previous two decades. + 11.8% + 6.2% + 8.5% Source: SHEEO SHEF Educational Appropriations per FTE, U.S., Fiscal 1980-2004, Constant 2004 Dollars Adjusted by SHEEO HECA

3. The Opportunity As the economy improves, it is now time to plan for the next recession Symposium on Financing of Higher Education April 2004

4. Project Goal To identify and disseminate successful state-level strategies and policy tools to protect student access to postsecondary education

5. Appropriations for higher education are affected by national recessions.

6. Recession and Recovery RecessionDecease in Appropriations per FTE Recovery 1980-8226 states1.6 years 1990-9138 states3.4 years 200144 states?

7. 2001 Recession and Recovery Number of States Below 2001 approp/FTE Recovered to 2001 Level 2001-200344- 2004451 2005402 20063012

9. Financial Access - the Balancing Act Aid-to-tuition Ratio (higher is better) Public Need-Based Aid per FTE Weighted Average Public Tuition Access-Cost Indicator (lower is better) Average Tuition & Fees – Aid per FTE 30 Percentile Family Income

12. NASSGAP/SHEEO Survey What impact has the recession of 2001 had on state higher education and student aid policies and priorities? What strategies have states used to maintain financial access?

13. Which Higher Education Issues Have Become Priorities Since FY2001? (by Annual Appropriations Change) 0 10 20 30 40 50 60 70 80 90 100 Workforce Prep Seamless Transitions Affordability Enroll.Growth Minority Opportun. Limit Tuition Increas. Quality of Ed. Percentage Decrease Flat Increase

14. Preliminary Analysis What Are Your State’s Student Aid Priorities? (By Geographic Region) 0 10 20 30 40 50 60 70 80 Resources for Low-Income Helping More Students New Initiative Increasing Max Award College Savings Covering Tuition Increases Expanding Merit-Based Percentage M-HEC New England SREB WICHE

15. Student Access Since FY2001 0 10 2030405060708090100 Enrollment Shifts from Higher to Low-Cost Increased Selectivity Reduced Less Prepared Increased Enrollment of Low-Income More Going Out-of-State Education Viewed More as a Personal Benefit Institutional Aid Grown Faster than State Aid State Aid Increases Kept Pace with Costs More Starting at Community College Students Expected to Pay More Percentage Uncertain Disagree Agree

16. Selection of States Primary Selection Criteria Access-Cost Indicator Average Change 1979-2003 Post 2001 Recession Change Aid-to-Tuition Ratio Average Change 1979-2003 Post 2001 Recession Change

17. Selection of States Secondary Selection Measures Region Enrollment Size Participation Rates Population Educational Attainment Community College Enrollment Least Decrease in Appropriations per FTE

18. State Interviews 7 states 54 policymakers 30 questions Successful Attributes Arizona Kansas Illinois Massachusetts North Carolina Texas Washington

19. Defined Goals and Coherent Plan Develop a populist master plan Work inside and outside the capitol Repeat planning process every 4-5 years

20. Clear and Consistent Message Define issues clearly in simple terms Identify student need & what it will take to fund it Articulate the future clearly Repeat the message over and over

21. Student Aid Options That Meet State Goals Articulate goals clearly Include students at public & private institutions Focus on need-based aid, not merit aid Concentrate on one primary need-based aid program

22. Focus on Students Be an advocate Hold low-income students harmless on tuition increases Involve students in tuition revenue spending decisions

23. Commitment to Access and Affordability Strongly held values Constitutional or legislative provisions Strong state and campus leaders

24. Coordination All sectors speak with a unified voice Leadership by SHEEO and flagship president Personalities or structure can cause this to happen

25. Develop Champions Within the legislature Across party lines Among the general public/business community Maximize every opportunity for collaboration

26. Major Challenges Facing States Rapid Growth in Hispanic Student Enrollment Financial and Geographic Access Balancing Tuition and Financial Aid Competition for Scarce Resources

27. Tuition Trends Significant Increases Attempts to Deregulate Tuition Consideration of 4-Year Guarantees Tuition Set-Asides for SFA Increasing Reliance on the Tuition- Payer than the Tax-Payer to fund higher education

28. Project Partners National Association of State Student Grant and Aid Programs State Higher Education Executive Officers Center for the Study of Education Policy – Illinois State University