May 6, 2020

New SHEEO report finds state funding remains below historic

Bizclik Editor
3 min

BOULDER, Colo., May 5, 2020 /PRNewswire/ -- In fiscal year 2019, state and local support for higher education topped $100 billion for the first time in history. At the same time, public higher education finance has never been more precarious. Institutions face increased costs, loss of tuition revenue, and unknown enrollment for the coming academic year. Meanwhile, reductions in state budgets firmly indicate sweeping cuts are coming for higher education.

A 2.4% increase in per-student education appropriations marks the likely end of a seven-year recovery in higher education funding.

On a per-student basis, education appropriations (a measure of state and local funding for general operations and financial aid at public institutions) increased $195 above inflation in the last year. While states' efforts to increase funding for higher education should not be discounted, many public institutions are still without the necessary funding to appropriately weather the coming economic decline.

Despite seven years of moderate increases in per-student funding for higher education, only seven states have fully recovered from funding declines during the last recession. Nationally, education appropriations remained 8.7% below pre-recession levels in 2008, and states have only recovered about two-thirds (63.5%) of the total decline seen during the Great Recession.

"States have many budget priorities, and often higher education is the first place to be cut," said Robert E. Anderson, president of SHEEO. "Public higher education is entering a period of economic uncertainty in an unstable position. Without adequate state funding, and with huge uncertainty surrounding fall enrollment and tuition revenues, public institutions will lack the resources they need to properly serve their students in the coming year."

If the last two recessions are any indication, funding for public higher education will decline more than any other budget area over the next few years. Over time, recessions have led to deeper declines and shallower recoveries in state funding. In 2019, public institutions received, on average, $1,800 less in per-student funding than prior to the tech bust in 2001.

While these findings are crucial to understanding the broad strokes of national finance trends in higher education, it's important to note that national trends mask considerable variation across the states. The full SHEF report paints a more complete picture of differences in public higher education finance across states.

This year, with generous funding from the Bill & Melinda Gates Foundation, the State Higher Education Executive Officers Association (SHEEO) is launching a brand new, fully interactive, SHEF website. The new SHEF website currently features an animated overview of higher education finance, customizable visualizations, and data downloads throughout the interactive report and issue briefs, with even more interactive tools to be released in the coming months.

Explore the SHEF website to read the full report and customize the adjustable data visualizations. The SHEF website also includes issue briefs that focus on state recovery from the Great Recession, regional differences in higher education finance, and changing trends in the allocation of state financial aid.

For the full press release visit:

About the State Higher Education Executive Officers Association (SHEEO)

The State Higher Education Executive Officers Association serves the chief executives of statewide governing, policy, and coordinating boards of postsecondary education and their staffs. Founded in 1954, SHEEO promotes an environment that values higher education and its role in ensuring the equitable education of all Americans, regardless of race/ethnicity, gender, or socioeconomic factors. Together with its members, SHEEO aims to achieve this vision by equipping state higher education executive officers and their staffs with the tools to effectively advance the value of higher education, promoting public policies and academic practices that enable all Americans to achieve success in the 21st century, and serving as an advocate for state higher education leadership.

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SOURCE State Higher Education Executive Officers Association (SHEEO)

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