What Can Research Tell Us About Steep Cuts for Public Colleges?

Public colleges in Illinois have seen some tough times in recent years. Enduring nearly 800 days without regular state appropriations will have that effect.

A budget stalemate between Gov. Bruce Rauner, a Republican, and the Democratic leaders of the state legislature led to hundreds of layoffs at public colleges and concerns that some campuses might even close.

So Jennifer A. Delaney, an associate professor of higher education at the University of Illinois’s flagship campus, thought it would be natural to host a forum here and encourage academic research on how volatile state support affects higher-education policy.

“It’s probably not a coincidence that I was sitting in Illinois experiencing a budget crisis and thinking this might be a good topic,” she said.

The protracted battle in Illinois was unusually vexing to its public campuses. But colleges across the nation have struggled to manage the effects of the Great Recession and the resulting uncertainty in state support.

“It has only now been a decade since the Great Recession started, so we still don’t yet fully understand the impact of that massive event and the economic and financial health of states,” said Christopher R. Marsicano, a presenter at the forum, who will be a visiting professor of educational studies at Davidson College starting in July. And since the recession, there has been enormous political change in statehouses, with historic increases in Republican legislators and governors, he said.

While much research has looked into how colleges use the money they have, Delaney said, there is much less on how risk and uncertainty affect higher-education institutions. “The same amount of money with a lot of risk in an environment is different than money and certainty,” she said.

With a grant from the American Educational Research Association, Delaney and three other researchers solicited proposals and chose a dozen projects. The final program featured a mix of emerging research on a varied set of questions: Do some state-finance policies prevent big budget cuts in higher education? Does faculty productivity decline when a research university faces fiscal adversity? What is the role of student fees in propping up a college’s budget when state appropriations fall?

Surprising Answers

The answers to those questions were sometimes surprising, attendees said, though they stressed that the papers were all in “working” condition — not yet polished or ready for publication — and only the abstracts are available online now.

One project examined whether policies such as performance-based funding, merit-aid programs, and centralized tuition authority — under which a legislature or governing board sets tuition rates — were associated with less volatility in state appropriations. The study was conducted by Amy Li, an assistant professor of education at the University of Northern Colorado, and three researchers at the State Higher Education Executive Officers.

The research suggested that greater changes in appropriations happen when a central body controls tuition, not when individual institutions are left to do so. The other two policies are associated with less volatility, the research found.

Another study, by Robert Kelchen, an assistant professor of higher education at Seton Hall University, looked at “whether large reductions in state higher-education support are associated with changes in research funding and the number of faculty members receiving major awards.”

Kelchen found, to the surprise of many at the forum, that there was “little evidence to support the hypothesis that public research universities are losing a significant number of top researchers following budget cuts.” That conclusion “raises questions about the steps universities are taking in an effort to maintain their research enterprise in challenging times,” he wrote in a summary of his findings.

A third study, by two scholars at Arizona State University, also piqued the interest of attendees. Jeongeun Kim, an assistant professor of educational leadership, and Chukwuemeka A. Ikegwuonu, a graduate student, built their own data set of mandatory fees charged to students in several states. They found that, in most cases, declines in state appropriations didn’t result in an increase in overall fees. But cutbacks did change the kind and purpose of fees.

When state dollars are cut, the researchers found, colleges may charge more fees for facilities and academic purposes, or even create a new fee to offset the loss of public money. Unlike tuition, fees tend to go down when state appropriations increase by more than 3 percent, they wrote.

Delaney urged caution in putting too much stock in the early results of the research, saying the conclusions of several papers may change after they receive more rigorous reviews.

Even when the papers are in final form, the solutions to the problem of wild swings in state funding may be elusive or even impossible to prevent, said William M. Zumeta, a professor of education and public policy at the University of Washington.

In a speech at the forum, Zumeta said he had been examining similar issues in state finance since the 1980s. Higher education and state government could do a better job of managing their money, he said, by drawing on reserves during economic downturns and building up broader support for colleges among statewide groups, such as businesses.

But in the end, he said, the ups and downs of the economic cycle are largely unavoidable: “I’m a skeptic that volatility can really be solved.”

Eric Kelderman writes about money and accountability in higher education, including such areas as state policy, accreditation, and legal affairs. You can find him on Twitter @etkeld, or email him at eric.kelderman@chronicle.com.