This week's issue of U.S. News reports that the Commonwealth has both the best large and small public universities in the nation.

The latest installment of Kiplinger Magazine -- which factors quality and cost -- places five Virginia colleges among the Top 25 public universities in the country.

No other state comes close.

On the other hand, some elected officials and college presidents warn that Armageddon is just around the corner unless the Commonwealth renews its financial commitment to higher education.

So what happened? If Virginia universities are such a great bargain, why does college cost so much? If Virginia universities are doing so well, why do your presidents keep asking for more money?

The answer to both questions lies within the decisions we made during the past decade.

Economic Rollercoaster

The fate and fortunes of higher education in Virginia have been linked directly to the health of Virginia's economy.

When the State coffers have been full, higher education has enjoyed the benefits -- and the Commonwealth has reaped the dividends in high wages and low unemployment.

But when the State hit the economic rocks of a recession -- both in the early 80's and the early 90's -- the economic roles were reversed.

Higher education was no longer the beneficiary; Virginia colleges instead became a banker. In the early 90's alone, an estimated 1/2 billion was transferred from higher education to balance the state budget.

Instead of raising state taxes -- we raised college tuition by almost 50% over the last six years. Unmet student financial aid needs soared and our ability to meet those needs fell far behind.

No surprise that parents, public officials and tax payers continue to ask: why does college cost so much?

Shifting the Cost of College

What changed in the last 25 years was not the spending habits of the colleges, but the higher education policy of the Commonwealth.

We have adopted, in effect, a "tuition transfer tax" that has shifted a large portion of the financial burden from the general fund to the students and their parents.

In fact, if the State had not abandoned its "70/30" tuition policy in the early 80's, tuition increases at the College of William and Mary would be less than the cost of living.

That's correct: tuition increases would be below the inflation rate.

Put another way, if the Commonwealth reinstated its commitment to fund higher education at the same level that it did in 1982 -- we could reduce in-state tuition at W&M by $1,300 -- a 45% reduction.

It's not the cost of higher education that has changed radically in recent years, but who is paying the bill.

Belt Tightening and Backlogs

How did we fill a huge hole in the higher ed budget?

We became more efficient, cutting administrative costs and red tape and saving an estimated $110 million a year through restructuring.

We tried to ease the burden on Virginians by freezing tuition costs for the last three years.

We passed the costs onto our out-of-state students; almost pricing some schools out of the marketplace.

We failed to fund enrollment growth, taxing facilities and producing overcrowding, particularly at JMU, GMU, VPI and ODU.

We deferred maintenance and critically needed renovations; indeed the capital outlay backlog will grow to an estimated $1 billion by the year 2003-04.

We reached out to donors to help address these needs, resulting in endowments approaching $2 billion dollars for Virginia's public institutions.

We received a critically needed infusion of funds from the Governor and General Assembly who provided a major shot in the arm for the current biennium.

Commonwealth and the Competition

We are working hard; we are working together, but we are not winning the battle.

While we have spent most of the 90's trying to recover lost ground, the competition has been steadily moving ahead.

The overall public investment by Virginia colleges compared to our peer groups -- the 175 schools that represent our academic competitors -- reveals that we are dramatically falling behind.

In school after school -- in case after case -- the pattern is the same. We are not in the same financial ball game.

Battle Plan for Higher Education

What do we do about it?

One answer is to amend our list of academic competitors and abandon the peer group system -- the classroom equivalent of "dumbing down the curriculum" if the students aren't getting good grades.

This course of action -- resigning from the major leagues and forming an academic farm team because we can't keep up with the competition -- would be a critical mistake -- a decision both unwise and unnecessary.

Virginia has the best system of public higher education in the nation. What we need -- and the people of this Commonwealth deserve -- is a battle plan to keep it the best.

The good news is that we have already done the homework.

The Chichester Report, produced by the Commission on the Future of Higher Education; the recommendations produced by the Business Higher Education Council; Va First 2000; and CIT's Blueprint for Technology (click Virginia Technology Summit) offer recommendations which -- taken together -- represent a framework for the future of higher education.

As the Governor's Blue Ribbon Commission begins its important work, Virginia's college presidents hope the Commonwealth will build on this beginning:

• Reinforce our academic diversity; don't diminish it. We are all different; measure us against our own goals and missions.

• Agree on the results we want; set us free to achieve them -- and hold us accountable for the results. Encourage innovation and loosen the bureaucratic noose -- so we can make the changes that need to be made.

• Resist the argument that would lead to the use of donor dollars to replace state revenues. The first question on every donor's mind: "If I give more; won't the State just give less?"

Prospects for Class of 2010

As students arrive on campus this week, the outlook for the Class of 2002 could not be brighter. What about the prospects for the Class of 2010 whose future we begin to shape today?

The challenge is clear.

If we do not build a firm foundation beneath Virginia's colleges and universities -- Virginia's ten-year olds who look forward to receiving a first-rate education at an affordable price will be gravely disappointed.

We will have failed the next generation of Virginians and the 21,168 families who have invested their savings in Virginia's pre-paid tuition program.

The colleges of this Commonwealth -- the envy of the nation today -- will exist tomorrow in name only.

Colleges must compete and we have; colleges must collaborate and we can; colleges must change and we are.

But as we prepare ourselves to meet the demands of the next century, we must always remember: our way was paid by those who came before us.

When the Class of 2010 assumes the reins of state leadership, what will they say about us? That we spent it all -- or that we replenished the account for the next generation.

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Posted: August 27, 1998
By The Educational Policy Institute of Virginia Tech
sjanosik@vt.edu