Category: Finance

Locking Students Out of Our Colleges a Losing Strategy

This commentary was published on Sunday, April 12, 2015, in the San Francisco Chronicle.

High school seniors across the state are just now hearing if they will be accepted into the college of their choice. Most of those students have applied to one or more of the state’s public four-year universities and, despite meeting eligibility criteria, many will be disappointed. While this is certainly distressing for individual students and their families, this problem points to larger, troubling issues of access to and student success in California’s higher education system. The state’s public universities are not able to accommodate all of the qualified students who apply.

(Continue reading on sfchronicle.com)

Video: PPIC Statewide Survey Briefing

As discussions continue in Sacramento about drought relief, funding for higher education and transportation projects, and an extension of Proposition 30 tax increases, PPIC surveyed public opinion on these and many other topics. At a briefing last week in the capital, PPIC researcher Jui Shrestha provided the survey findings. Among the key points:

  • Two-thirds of Californians say the regional water supply is a big problem, and two-thirds say people in their part of the state are not doing enough to respond to the drought.
  • While most adults say that spending money on the maintenance of California roads, highways, and bridges is very important, there is little support for increasing the gasoline tax or vehicle registration fees to do so.
  • Half of Californians favor extending the Proposition 30 tax increases, and about a third favor making them permanent.

Testimony: Low-Income Students and Financial Aid

As the legislature considers a number of bills aimed at increasing access and affordability of public higher education, the state assembly’s subcommittee on education finance invited PPIC to testify this week. The focus was the unmet financial aid needs of low-income college students. Hans Johnson, PPIC senior and Bren Fellow, presented data from the recent PPIC report Making College Possible for Low-Income Students: Grant and Scholarship Aid in California, which details the importance of federal and state grant aid in ensuring that higher education remains a ladder of economic opportunity for all Californians.

Johnson noted that as the state has cut funding for the University of California (UC) and California State University (CSU), tuition has increased and grant aid has become increasingly important to help students afford college. Research has also shown that grants and scholarships help students persist in their education and enables students to focus on their coursework and complete college faster. UC and CSU remain less expensive options for low-income students in terms of “net price”—the cost of attending college after accounting for federal, state, and institutional aid—than non-profit and for-profit private colleges. However, students whose family incomes are $30,000 or less still pay nearly a quarter of their incomes, or $8,000 per year, to attend a public four-year college.

Improving college access and completion is vital to California’s economic well-being, and aid for students has become increasingly necessary. The legislature’s attention to this issue comes at a time when 60% of California high school students qualify for free and reduced price lunch and three-quarters of California’s low-income college freshmen are enrolled in a UC or CSU.

Commentary: Obama’s Community College Plan No Panacea

This commentary was published today by the Washington Post.

President Obama’s proposal to make community colleges free is a valiant effort to address the rising demand for skilled workers throughout the nation and to improve college access for low-income students. As states consider his proposal, they would be wise to look to California . . .

(Continue reading on washingtonpost.com.)

Dividing California’s Higher Education Pie

The tuition increase recently approved by the University of California Regents has ignited a debate about how the state allocates money for higher education. A brief look at the history of state funding can provide some much-needed perspective.

Each higher education system—UC, the California State University, and the community colleges—receives substantial funding from the state. Most of the remaining funds for instruction come from tuition paid by students. (In this analysis, we look at allocations from the state General Fund and property taxes so that we can compare institutions across time.)

Since 1965, the share of higher education funding provided directly by the state has shifted from the four-year systems to the community colleges. In the mid-1980s, the community colleges received about a third of the state allocations to public higher education institutions. In 2014‒15, the community colleges got more than half of the pie. Meanwhile, the share allocated to CSU and especially UC has been shrinking. UC’s share fell from 38% in 1965 to 24% in 2014‒15, and CSU’s share declined from 25% to 22%. The governor’s proposed 2015‒16 budget includes a funding increase of $843 million to the state’s public colleges and universities—71% ($600 million) of which would go to the community colleges.

The large increase in state allocations to community colleges is linked to increased enrollment. But enrollment has increased just as much at UC and CSU. Indeed, on a full-time equivalent basis, UC, CSU, and the community colleges each serve about the same share of the state’s public higher education students today as they did 50 years ago. So what explains the shift in the share of funding from UC and CSU to the community colleges?

The short answer is Proposition 98.

After Proposition 13 passed in 1978, the state’s community colleges—which unlike UC and CSU relied partly on property taxes—saw a sharp reduction in their share of state and local support. Ten years later, voters passed Proposition 98, which guaranteed K–12 schools and community colleges a minimum percentage of the General Fund and property tax revenue. Proposition 98 guarantees that K–12 schools and the community colleges get about 40% of these allocations—and about a tenth of that share goes to the community colleges. Some have argued that Proposition 98 acts as a funding ceiling for K–12 schools and community colleges, but it also serves as a floor.

UC and CSU lack the same funding protection. While many budget areas outside of higher education are at least partially protected by dedicated funding streams, court orders, or matching federal funds, UC and CSU are vulnerable when state revenues decline. The universities have faced disproportionately large cuts in their general fund allocations during times of economic hardship. From this vantage point, a funding floor—even one that doubles as a ceiling—is preferable to a funding drop-off.

The three higher education systems also receive indirect forms of state support such as Cal Grants, fee waivers, and middle-class scholarships. Grant aid has increased for students at all institutions of higher education in California. Our best estimates suggest that community college students receive slightly more of these state funds (41% of the total in 2011‒12), than UC students (40%) and much more than CSU students (18%).

The debate over higher education funding could benefit from a clearer understanding of how the pie is divided. But the most important issue for the state’s young people is that the pie is not keeping pace with demand. Our four-year colleges have record numbers of applicants and the shares of students who are academically qualified to attend them have increased. The future prosperity of Californians and their state depends on access to higher education. To address these issues, policymakers need to focus on improving vocational programs and pathways from community colleges to four-year colleges and improving access and enrollment at UC and CSU.

Notes (TOP FIGURE): 2012-13 to 2014-15 numbers are from the governor’s budget; earlier data is from the California Postsecondary Education Commission. We include property tax allocations which are a component of the state’s obligation to community colleges pursuant to Proposition 98.

Paying for Higher Education

As concerns have grown about access to and affordability of California’s higher education system, understanding costs has become more critical than ever. How are institutions—and students—faring?

This question is the focus of three reports released by PPIC and a panel discussion held last week in Sacramento. Hans Johnson, a Bren fellow at PPIC, first summarized the research. One report shows that federal financial aid has shielded low-income students from rising tuition at the University of California and California State University. A second report evaluates both revenues and spending—including faculty salaries and benefits— and concludes that UC and CSU have not become less efficient in the past several years. A third report suggests that as California begins to reinvest in public higher education, it could tie funding more closely to results—for example, the number of degrees awarded—to meet state goals. In his presentation, Johnson noted that the state’s current goals—the Master Plan for Higher Education—are more than 50 years old and overdue for an update.

Panelists took up the issue of goals—how to set them, what to measure, and how to share the costs—in a discussion moderated by Patrick Murphy, PPIC research director. Participants were Henry Brady, dean of UC Berkeley’s Goldman School of Public Policy; Nancy Shulock, former executive director of CSU Sacramento’s Institute for Higher Education Leadership and Policy; and Amy Supinger, California policy consultant for the Lumina Foundation.

Video: Making College Possible

At a time when California’s economy needs more college graduates, a new PPIC report examines the role of grants and scholarships in making higher education both accessible and helping students graduate. Hans Johnson, the report’s author and PPIC Bren Fellow, talked about his findings at a briefing last week in Sacramento.

He found that although total financial assistance available through federal grants, Cal Grants, institutional aid, and private scholarships has increased, it has not kept pace with the actual cost of attending California State University and community colleges. These are the California colleges that enroll most low-income students in California—a state in which nearly 60 percent of K–12 students qualify for free and reduced price lunch programs.

“If we want the economic ladder to success to work in California, we need more students to go to and complete college,” he said. “And given our student population, a lot of those students will be from very low-income families.”

He recommended strategies to make college more affordable and accessible. They include directing any additional aid to low-income students and helping more students complete financial aid forms.

The Future of Online Education in Public Colleges

Policymakers and educators have a lot of questions these days about whether new communication technologies can be helpful in higher education. Will they lower the cost of teaching, provide access to those who are otherwise left out, or provide more effective individualized instruction? With encouragement from Sacramento, California’s three public higher education segments are pursuing new initiatives in online education. On Tuesday, PPIC hosted a lunch event on this topic.

Hans Johnson, PPIC Bren Fellow, talked about his recent study, co-authored with PPIC research associate Marisol Cuellar Mejia, about online education in the state’s community colleges. The study found that participation in online courses has soared in the last decade but that success rates—in terms of course completion and passing grades—are lower for online students.

An expert panel expanded the discussion, with Joseph Moreau, executive sponsor of the Online Education Initiative at the California Community Colleges; Ashley Skylar, quality assurance manager for academic technology services at the California State University; and Arnold Bloom, who teaches an online course in climate change at UC Davis. Panelists talked about efforts to improve the quality of online instruction—the course materials and training of instructors. They also said it is too soon to tell whether online education may save money, but the size of California’s higher education systems provides opportunities for collaboration among campuses, which may produce more cost-effective education.

UC President Napolitano on Tuition, Online Learning, and the Role of the University

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Janet Napolitano, the new president of the University of California and the former U.S. secretary for Homeland Security, said Monday that she told President Obama that the United States cannot thrive unless California thrives—and California cannot thrive unless the University of California thrives. Napolitano was responding to a question about why Californians should care about the public university system. Her comments were part of PPIC’s 2014 Speaker Series on California’s Future, which drew an online and in-person audience of nearly 500 to a conversation with PPIC President Mark Baldassare at the Sheraton Hotel in Sacramento. The wide-ranging discussion opened with a presentation from Hans Johnson, PPIC senior and Bren fellow, who provided context about the state’s need for educated workers.

The UC president, who also served as governor of Arizona, talked about tuition and budget issues, as well as online education, access for low-income students, and the lessons she’s learned since starting this job about six months ago. Napolitano said there was much the university is doing well: 42 percent of UC students are eligible for grants to low income students, 46 percent are the first generation in their families to go to college, and more than one-third are from families where English is not the primary language. She also said no public research university in the country is more efficient at helping students graduate within four years.

Still, she talked at length about the changes underway in funding for higher education and the need for new models. She emphasized that tuition will not increase for the 2014-15 school year and said that the university is dedicated to a tuition rate that is “as low and predictable as possible.” She also said she hoped to increase the university’s financial connection to philanthropy and the private sector. She said the state could do more and it should do more to support higher education.

Speaking about the future of higher education, Napolitano said online learning “is a tool in the tool box,” not a silver bullet. She said it is not necessarily cheaper than traditional classroom instruction and—despite some claims—no more effective at remedial education. She said, however, that it could get students access to classes not available on their campus.

Evaluating Student Success at the City College of San Francisco

In July 2013, the Accreditation Commission for Community and Junior Colleges reaffirmed its earlier decision to pull accreditation from the City College of San Francisco (CCSF). Citing a “lack of financial accountability as well as institutional deficiencies in the area of leadership and governance” as the “main obstacles to the college’s turnaround,” the commission allowed CCSF 12 months to prepare to cease operation. San Francisco’s city attorney and City College faculty have filed lawsuits against the commission, and in January a court granted an injunction placing the loss of accreditation on hold. The California Community College Chancellor’s Office, which oversees the state’s 72 community college districts, is working closely with City College to address the commission’s concerns and avoid the loss of accreditation. And the state legislature is considering a bill that would stabilize CCSF funding for the next two years. Meanwhile, students are responding to the controversy: City College reports a 16 percent decline in spring enrollment in 2014 compared to 2013.

The fight over CCSF’s accreditation is focused on a number of issues and concerns. But it raises important questions about how colleges should be evaluated. Many states have begun funding higher education institutions based on performance, and California officials are discussing similar performance measures. Most would agree that student outcomes are an important measure of any college’s effectiveness. Of course, good student outcomes for a college might simply reflect the strength and preparation of incoming students.

Because the California Community College Chancellor’s Office does an excellent job of providing information on student success, we have a wealth of data to examine student outcomes at CCSF. By most measures, City College fares well relative to other community colleges in the state. The share of students who complete college by earning a degree or certificate, or by transferring to a four-year college, is higher at CCSF than in the rest of the state. This advantage holds even when we limit our analysis to students who are initially unprepared for college-level work, which suggests that it is not simply the mix of students drawn to City College that drives its outcomes. (Although it is possible that CCSF’s unprepared students are closer to college level than unprepared students at other colleges.)

Of particular interest is how effectively a community college prepares students for transfer to four-year colleges or universities—this is arguably the most important mission of community colleges. Among students defined by the chancellor’s office as intending to transfer, City College has a higher success rate than most other college districts, ranking 6th out of the state’s 72 community college districts and 4th among the state’s larger districts—those with at least 2,000 students intending to transfer. The other top districts are a who’s who of the state’s most highly regarded: Foothill-De Anza, South Orange County, San Diego, Pasadena, and Santa Monica. By this important measure, City College is in very good company.

On some outcomes, City College performs below average. For example, its success rates in math remediation are significantly lower than the state average, and the share of career technical, or vocational, students who earn a certificate is slightly lower than the state average. However, City College fares well in most other measures. For example, the share of students who successfully complete remediation in English is higher than the statewide average, as is the share of students who successfully complete ESL courses.

Student outcomes are not the only way to assess a college. But they are an important measure of success. CCSF has provided thousands of students with a pathway toward meeting educational and occupational goals. That is no small feat.