Episode 104: Public Universities–One More Time

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This is our final episode before the holiday break and before those of you with seniors are facing what is likely D-Day–Deadline-for-college-applications Day–at least, for many, many colleges anyway. We struggled to think of something hopeful to say, and we settled on one last look at a group of colleges your teenager and you might not have considered sufficiently, and that is public universities. They have long been a favorite topic of ours, as evidenced by our detailed coverage of them during our virtual nationwide college tour (Episodes 27 through 53) and our oft-repeated description of public flagship universities as the hidden jewels of our higher education system in the U.S.

But recently, I read some new information that might make them even more attractive to you, and that information is about money. Our regular listeners know that I care relatively little about the cost of a college compared to the education and college life it provides and the quality of its match to a particular student. But even I was pleased to find out this information. Perhaps it is just in time for adding one or two more colleges to your teenager’s list (especially if the applications are relatively easy or the deadlines are a bit later than January 1, both of which can be true for large public universities).

1. Out-of-State Tuition Prices Dropping

A few weeks ago, I read an Associated Press article, by Jeff Amy, which had a catchy headline: “Seeking students, public colleges reduce out-of-state prices.” It starts with an interesting story from the University of Southern Mississippi (USM) in Hattiesburg, but doesn’t stop there. Here is the USM story:

The 14,500-student school has cut annual out-of-state tuition and fees from $16,529 this year to $9,964 next fall, even as it increases the cost for Mississippi residents by 4 percent, to $7,963.

The idea is to reverse a 2,000-student enrollment dip by pricing a USM education below some public universities in nearby states, and attract enough high-schoolers from Houston, Dallas and San Antonio to raise overall revenue. (quoted from the article)

Of course, as our regular listeners might say, those high school seniors could also come from New York City, Philadelphia, and Chicago. Why? Because kids need to get outside their geographic comfort zone! And now, USM and other public universities are making it even more attractive and cheaper to do just that.

According to Mr. Amy’s article, “The Associated Press counted at least 50 public colleges and universities nationwide that have lowered nonresident tuition by more than 10 percent in recent years without making similar reductions for in-state students.” Is there any particular reason for that trend? Mr. Amy’s article offers this statistic:

Many [colleges] are squeezed by falling numbers of traditional college-age students. High school graduates have fallen nationwide since 2011 and won’t peak again until 2023, according to the Western Interstate Commission on Higher Education. (quoted from the article)

Well, that was something I didn’t know. So now, let’s head way north from Hattiesburg and take a look at the University of Maine‘s flagship campus. Mr. Amy tells this story:

One widely noticed move was made by the University of Maine in Orono, which charges high-achievers from nine other states the same tuition they’d pay at their home state’s flagship. This saves them $12,000 to $17,000 from Maine’s out-of-state tuition of $29,498; applicants with lower grades and test scores get $9,000 off.

“The state of Maine needs young people, and we’re not producing enough of them,” said University of Maine Provost Jeffrey Hecker?.

It’s working: Applications jumped, freshman enrollment rose 9 percent to 2,260 students this fall?. (quoted from the article)

This arrangement at the University of Maine echoes some arrangements we talked about during our virtual nationwide college tour (Episodes 27 through 53) where groups of neighboring states in various parts of the country offered good financial deals to students to cross state lines and attend public universities. And, parents, don’t forget to check out about any regional exchanges your state belongs to (e.g., Western Undergraduate Exchange, Midwest Student Exchange Program), which offer tuition discounts to residents of member states.

Of course, as we have said before, some public universities take some heat from state taxpayers for recruiting students from outside the state, especially when they believe that out-of-state students who can pay more are admitted instead of in-state students who deserve those places. But, as some states cut back on their funding of their own public universities, it is no surprise that those universities have to seek revenue elsewhere. Thus, at least in some states, out-of-state students are going to get a good deal.

2. Public Universities Recruiting Out-of-State Students

Last month, The New York Times published an article by Laura Pappano entitled “How the University of Alabama Became a National Player.” The whole article is well worth reading and tells about many more universities than we are going to talk about in this episode. But here is the Alabama story in a nutshell:

With state funding now just 12.5 percent of the university’s budget, campus leaders have mapped an offensive strategy to grow in size, prestige and, most important, revenue. The endgame is to become a national player known for more than championship football?.

The university is spending $100.6 million in merit aid, up from $8.3 million a decade ago and more than twice what it allocates to students with financial need. It also has hired an army of recruiters to put Bama on college lists of full-paying students who, a few years ago, might not have looked its way.

The University of Alabama is the fastest-growing flagship in the country. Enrollment hit 37,665 this fall, nearly a 58 percent increase over 2006. As critical as the student body jump: the kind of student the university is attracting. The average G.P.A. of entering freshmen is 3.66, up from 3.4 a decade ago, and the top quarter scored at least a 31 on the ACT, up from 27. (quoted from the article)

While it is clear that there are Alabama taxpayers who are annoyed that its well-known and much-loved flagship university is spending its money on out-of-state recruiters and merit aid to bright kids, it is also clear that these strategies seem to be working for the University. And that is why the University of Alabama now has 45 recruiters, with 36 of them in out-of-state locations.

According to Ms. Pappano’s article, Alabama is just one example of this trend. To take another example, the University of South Carolina (USC) has 20 recruiters, and now USC receives twice as many applications from out-of-state students as from state residents. Ms. Pappano sums it up this way:

It is no accident that states with among the largest drops in state allocations since 2008–Arizona (down 56 percent), South Carolina (down 37 percent) and Alabama (down 36 percent), according to the Center on Budget and Policy Priorities–have entrepreneurial public campuses trained on growth. Those same states also had the greatest net gain in students: More entered the state to attend their four-year public institutions than left to study elsewhere, according to fall 2014 data, the most recent available. (quoted from the article)

3. What Does It All Mean?

So, what does it all mean? First, giving great tuition breaks to out-of-state students likely means that some in-state kids will lose out on places at those public universities. Second, recruiting out-of-state kids who can afford to pay more likely means that some in-state kids will lose out on places at those public universities.   Third, giving merit scholarships to out-of-state bright kids likely means that some in-state kids will lose out on places at those public universities. All of these scenarios are understandably of concern to state taxpayers. These scenarios are also a concern to those of us who believe that public universities have a mission to make a college education accessible to a wide range of students, not just the best and the brightest and the most able to pay.

On the other hand, if you are the parent of a teenager who is looking for another college to add to the list as we get down to the wire, we can say that this could be the time to look both to public flagship universities and to other public universities that are actively recruiting out-of-state students. Check out the articles we have been discussing for more information. Depending on your teenager’s grades and test scores, there might even be a substantial financial break for you.

4. Good Luck!

We will be taking a short holiday break next week, and we will be back with you on January 5. At that point, those of you who have a senior with applications due in the first few days of January should be breathing a huge sigh of relief. Of course, some of you will still have deadlines to face in February and March and even later. And if you have a junior at home, your life is about to change.

But, parents of seniors, let us say again what we have said before: There is not just one perfect college for each kid. There are many colleges that would make each kid happy and many colleges that would give each kid a great education. Your kid will find one or more than one. Until then, we are keeping our fingers crossed for you. Happy 2017!

The Kindle ebook version of our book, How To Find the Right College, is on sale for $0.99 through 2016! Read it on your Kindle device or download the free Kindle app for any tablet or smartphone. The book is also available as a paperback workbook.

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