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More Money for Higher Ed? — Sky-High Tuition and Tax Initiative Force Lawmakers to Consider Burden on Students

Senate Ds Favor $225 Million In Higher Ed Spending to Hold Line on Tuition, but No Money to Pay for It -- Lawmakers Can't Avoid Decision

A classic view of Suzzallo Library at the University of Washington, before development of the Red Square parking garage.

A classic view of Suzzallo Library at the University of Washington, before development of the Red Square parking garage.

OLYMPIA, Feb. 1.—Skyrocketing tuition costs at the state’s colleges and universities, a near-doubling in the last five years, coupled with the effect of a tax measure passed by voters in November, are forcing lawmakers to make a tough choice about tuition hikes this year.

Senate Democrats are first out of the gate with a plan that would spend $225 million more on the state’s higher-education system, though they aren’t saying how they would pay for it. That’s a big problem all by itself in a year when lawmakers already face a billion-dollar problem with the state’s K-12 schools.  But if lawmakers ducked a tough question two years ago when they passed a bill allowing schools to raise tuition on their own, it has been handed right back to them by a little-noticed provision of last year’s Initiative 1185. Before schools can raise tuition again, lawmakers have to give permission.

Strip away the rhetoric about the importance of education and the needs of the 21st-century workforce and you get an issue that looks pretty much like every other under the dome – spending on the state’s colleges and universities all depends on the sort of budget deal lawmakers come up with when they wrap up their session three months from now. But there does seem to be a sense that after deep state-spending cuts during the recession and astounding increases in tuition, students and their parents are about at the breaking point. “Until we start crunching numbers on the budget, we can’t say what tuition is going to be,” says Senate Republican Leader Mark Schoesler, R-Ritzville. “We want to keep tuition as low as we can and we want to keep support for higher education as high as we can, because the past has not been acceptable.”

Lending support to the idea that the state might want to hold the line on tuition increases this year is a new report from the state actuary’s office that says financing problems with the state’s prepaid tuition program, GET, short for Guaranteed Education Tuition, might be largely erased if lawmakers find a way to avoid tuition hikes for the next two years.

Astounding Tuition Increases

Sens. Jeanne Kohl-Welles and David Frockt, both D-Seattle, announce Senate Democrats'  higher ed plan at a news conference this week.

Sens. Jeanne Kohl-Welles and David Frockt, both D-Seattle, announce Senate Democrats’ higher ed plan at a news conference this week.

Tuition at the state’s colleges and universities has shot through the roof over the last five years as state revenues tanked during the recession and lawmakers slashed their allocations for higher ed. Students made up the difference. In 2008-2009, undergraduates at the University of Washington paid $5,842 a year; today the figure is $11,305. Add student fees and the actual burden is $12,155.

That’s a 94 percent increase over the last five years. But even that figure doesn’t really convey what has happened in the state’s higher education system over time – a trend so long in the making that only those in their late 40s and early 50s can remember when things were different. Back in 1980, tuition at the University of Washington was $687 a year, with no additional fees – a figure that had been relatively flat since the 1950s, even during the inflationary times of the 1970s. What it meant was that a student working a minimum-wage job over the summer and after school might be able to pick up the tab without taking out loans. But things changed when the state found itself in a budget crisis in 1981; tuition at that point represented about 18 percent of the cost of education, and lawmakers decreed that students and parents should share the pain. Until that point tuition had been set by the Legislature and the tab was a matter of political controversy. But with a simple change in policy, lawmakers eliminated that problem. They pegged tuition to the cost of education and set the figure at 25 percent, and by doing it that way they avoided debate on tuition rates. The next year they raised the percentage again to 33 percent. College tuition began its upward climb at a rate triple that of inflation. Every time lawmakers sweetened faculty salaries or increased funding for new college and university programs, students saw a bump in their tuition as well, and there was seldom a peep about it on the House or Senate floor.

Not that anything was different in other states; figures presented at a House Appropriations Committee hearing Thursday showed that Washington’s four-year schools charge just a little higher than institutions elsewhere. But what that rapid increase amounted to was a tax on students and their parents, levied even in the fat years when state tax revenues were healthy, as lawmakers found other spending priorities. Although some of those higher tuition charges have been returned in the form of higher financial aid, students these days are increasingly forced to turn to loans that dog them the first decade or more of their post-college careers – a fact of life these days. One telling comment came during the first meeting last month of the House Higher Education Committee. Newly elected State Rep. Marcus Riccelli, D-Spokane, a former student lobbyist five years out of college, caused the room to erupt in knowing chuckles as he introduced himself by saying, “my unique perspective is that I bring student loan debt to the table, personally.”

These days, tuition isn’t set as a percentage of the cost of education — it is free to climb on its own. And as lawmakers slashed spending on higher education during the recession and gave schools the ability to raise their own tuition, with limits, the percentage borne by students now stands at an average 71 percent.

Something’s Gotta Give

Leaders of the Senate Majority Caucus face a rather knottier problem: Finding a way to boost higher ed without tax increases.

Leaders of the Senate Majority Caucus face a rather knottier problem: Finding a way to boost higher ed without tax increases. Left to right, Senate Republican Leader Mark Schoesler, R-Ritzville, Senate Majority Leader Rodney Tom, D-Bellevue, and House Republican Leader Richard DeBolt, R-Chehalis.

Leaving aside issues of affordability for students, the rapid increase in tuition has caused one immediate problem: The state’s 15-year-old GET program, designed as a way for parents to set aside money for college by paying for credits in advance, is so far out of whack that the state can no longer expect to invest the money in the stock market and come out even. Right now, at the current rate of return, the state is about $631 million short of meeting its future obligations. Though some have suggested eliminating the program, state actuary Matt Smith told the House Higher Education Committee Thursday that if lawmakers can find a way to hold tuition at its current rate for two years, the GET fund can start moving into the black.

There seems to be at least some sentiment for keeping tuition flat. At the start of the session the Council of Presidents, an association of the state’s four-year colleges and universities, came to the Legislature with a plan: Find a way to beef up spending on higher education by $225 million for 2013-15 and the state schools can avoid a tuition increase. Keep holding the line and by 2020 the ratio might be restored to 50-50.

“We’ve seen a dramatic shift over the last 12 to 13 years alone, and there is a great deal of concern about what that means for our students in terms of access, affordability and debt load,” said Paul Francis, the council’s interim executive director. The $225 million would be a first step toward restoring the 50-50 percentage. “We think the approach of having students paying nearly 70 percent has certainly gone too far, and that is why we are trying to increase the state investment so that we move the needle the other way.”

Gets Some Nods

So far the Senate Democratic Caucus has embraced the council’s plan, announcing its support at a news conference this week. The Dems are backing a two-year tuition freeze measure, SB 5420; a similar “50-50 by 2020” bill, HB 1624, has been introduced in the House with bipartisan support. And there is at least some talk of making the higher education system more efficient; another proposal from the Senate Democrats would provide funding incentives for schools that meet hit benchmarks for student needs. Key question, of course, is how to raise that $225 million. Lawmakers this year are being forced by last year’s McCleary decision to find an additional $1 billion or more for K-12 schools, and higher education doesn’t have the same Supreme Court imperative.

State Sen. Jeanne Kohl-Welles, D-Seattle, sponsor of the Senate measure, said she thought about including a funding source in the bill – a tax increase, perhaps – but decided that was a question better left to the Legislature. “We have so many options available to us that many of us will be working on it,” she said. “We know there are challenges in attaining the goal, and that will be laid out during the legislative session.”

Meanwhile, the new Republican-leaning Majority Coalition Caucus in the Senate faces the knottier problem of actually governing, and of making the numbers add up. And given the fact that the Senate majority takes a dim view of tax increases, its challenge is a bit harder. Senate Majority Leader Rodney Tom, D-Bellevue, said there is general agreement the Legislature has to do something – watch for a plan sometime in coming months. “If we want to grow this economy, if we want to have jobs, what we need to do from an education standpoint is to give our employers the workforce they need to move forward,” he said.

But one thing is clear – lawmakers can’t avoid tuition questions this session. Last year’s I-1185, the measure that imposes a two-thirds voting requirement on the House and Senate for tax increases, also stipulates that all fee increases must be approved by the Legislature. A little-noticed opinion from the state attorney general’s office issued just before session started said that lawmakers will have to reauthorize the tuition-setting authority they granted to colleges and universities two years ago. Meaning that like it or not, they are forced to make a decision about whether tuition remains flat or goes up again. “The Legislature is 100 percent in the driver’s seat on all fees,” says Tim Eyman, the veteran initiative promoter who sponsored the measure. “They can freeze them, they can raise them, but they have got to make the decision themselves.”

And while lawmakers may not like to give Eyman too much credit, it does force the Legislature’s hand. Schoesler notes that the Legislature always has the ability to establish a new tuition policy.  “We are always in the driver’s seat,” he says.

It’s just that this time lawmakers have to decide which way to steer.


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