Big Target, Bigger Cuts

Per-student state funding for public research universities dropped about 20 percent between 2002 and 2010, according to a report being released today by the National Science Board, the policy-making arm of the National Science Foundation.

The biannual “Science and Engineering Indicators” report (which will be released on the National Science Foundation’s website at noon), is designed to provide a broad base of quantitative information about the state of science, technology and engineering teaching and research in the United States and abroad, to help policy makers.

The report’s authors said they were particularly interested this year in states' funding of science and engineering research at the university level and what impact the national recession has had. In inflation-adjusted dollars, total state support for the top 101 public universities declined by 10 percent between 2002 and 2010, with nearly 75 percent receiving cuts. Because institutions' enrollments grew significantly during this period, the per-student decline was about twice as steep. State funding declined as a share of these universities’ budgets from 28 percent in 2001 to 19 percent in 2009. According to the report, funding dipped in the early years, rose until 2008, and then fell sharply as the recession hit.

“Following the two recessions that bookended the past decade, states had serious budget shortfalls,” Ray Bowen, a mechanical engineering professor at Rice University, former president of Texas A&M University, and chairman of the board, said in a press release. “But the decline in support for postsecondary education, especially public research universities, is a cause for great concern as we examine the condition of U.S. global competitiveness.”    

That states cut spending on higher education during the recession has been well-documented over the past few years. What is notable about the NSF report is that it breaks down cuts for one sector of higher education: public research universities. And in many states, the appropriations cuts for research universities are greater than cuts for other sectors of higher education. According to the 2010 State Higher Education Finance report, produced annually by Illinois State University’s Center for the Study of Education Policy and the State Higher Education Executive Officers, per-student state spending for all sectors of higher education institutions decreased by about 17 percent between 2002 and 2010.

While the report attributes much of the decline in funding to the two recessions that happened during the time period, and the lagging state revenues that accompanied them, higher education observers say macroeconomic shifts are not the sole culprit.

These observers say many state policy makers hold the view that research universities can weather state cuts better than open-access institutions such as community colleges because they can raise tuition and they have more diversified revenue streams through federal research grants, private giving, and corporate contracts. And while the recessions meant less revenue for state institutions, the shortfalls were exacerbated by growing entitlement costs in all states, which are cannibalizing a larger portion of state budgets every year.

“It seems to be a pattern around the country,” said Jane Wellman, executive director of the Delta Project on Postsecondary Education Costs, Productivity, and Accountability. “Nobody decided they wanted to see it this way.” Wellman said the confluence of decreased revenues, increased entitlement spending, and research universities’ ability to raise revenues outside of state funding hit research universities the hardest.

According to the report, Colorado’s research universities saw the sharpest decline in per-student funding, dropping from $6,617 in 2002 to $3,148 in 2010. The Colorado constitution has a provision that protects K-12 funding, so higher education has typically been one of the first items on the chopping block there. And the research institutions there were hit the hardest in terms of total dollars cut, though the state has given them more leeway to raise tuition, and their spending per student has decreased significantly less than community colleges and other four-year institutions.

Echoing Wellman’s statement, Mark Cavanaugh, chief financial officer for the Department of Higher Education in Colorado, said the state has no policy in place to cut the research universities first, but that it often seems more equitable to cut these institutions since they can raise revenues through other means to fill in the gaps.

The declines were not evenly distributed across the country. While some states saw declines of more than 30 percent, institutions in a handful of states saw increases. New York had an increase of almost 72 percent in per-student funding at its research universities.

Wyoming and Alaska also had increases of more than 10 percent. Both those states fund a portion of their higher education budgets through taxes on natural resources, and neither has been affected as much by the recession as have states with larger populations.

In a conference call, the report’s authors expressed concern that the decrease in public funding for U.S. institutions, coupled with a dramatic increase in public support for institutions in China and India, could contribute to the U.S. losing its competitive edge in the sciences and engineering.

The number of natural science and engineering undergraduate degrees produced in China rose from 280,000 to 1 million between 2002 and 2008. The number of doctoral degrees produced in China also outpaces the number produced in the U.S., and unlike in the U.S., the overwhelming majority are awarded to domestic students.

Other findings in the report include:

• Nearly one in five U.S. citizens/permanent residents who received doctoral degrees from 2005 to 2009 had earned some college credit from a community or two-year college.
• Women have earned about 57 percent of all bachelor’s degrees and half of all science and engineering bachelor’s degrees since the late 1990s. In general, men earn a majority of bachelor’s degrees in engineering, computer sciences, and physics. More women than men earn degrees in chemistry; biological, agricultural and social sciences; and psychology.
• Within six years, 63 percent of undergraduates in four-year science and engineering degree programs had completed their degrees, compared to 55 percent of students in other majors.
• Women continued to enroll at disproportionately lower rates in engineering, computer sciences, physical sciences and economics.
• In 2009, underrepresented minority students made up 12 percent of students enrolled in graduate science and engineering programs, with Asian/Pacific Islander students representing 6 percent and white students 48 percent. Temporary residents accounted for the remainder of graduate enrollments in science and engineering programs.