Minority and Low-Income Students Suffer the Most as College Wealth Gap Widens

Report Shows a Shift Away From Public Funding.

Tuitions are up but educational dollars are moving away from the classroom, and students at public institutions are shouldering more of the cost of college while getting less for their money, according to a report released today.

The report, released by the Delta Project on Postsecondary Education Costs, Productivity, and Accountability, indicates students enrolled in public colleges and universities — where a majority of students matriculate — receive the fewest resources available in higher education.

The mission of the Delta Project is to help improve college affordability by controlling costs and improving productivity. During a teleconference held on Tuesday, executive director Jane Wellman said the data indicated the privatization of higher education most benefits institutions that have a research mission, rather than student-focused institutions.

“I don’t believe the states have made a conscious decision to disinvest in higher education. It’s just turning out that way because higher education gets squeezed when state funds are squeezed,” added Wellman.

“States have to go back first to principles of how they are investing public subsidies in higher education,” Wellman said. “That might take them to shifting of resources across sectors and also some decisions about where they want to put students relative to spending in order to have the most effective use of public resources to produce public results.”

The report “Trends in College Spending: Where Does the Money Come From? Where Does the Money Go?” notes that state appropriations per student declined from 2002 to 2005. They rebounded slightly in 2006 (the last year for which data is available), but did not reach previous levels. Students are shouldering more of the total cost of their education at all institutions, except private research universities that have a number of revenue sources, such as endowments.

The researchers studied nearly 2,000 public and private nonprofit colleges and universities across the 50 states. This represents institutions that account for more than 75 percent of higher education enrollment. The years reviewed were 2002-06. The six primary metrics were: revenue, spending, student share of educational costs, spending and enrollment, spending and tuition, and spending and results. The data came from the U.S. Department of Education’s Integrated Postsecondary Education Data System.

The impact on inner-city and minority students seeking higher education — most notably at community colleges and public institutions — is the greatest, the report states.

“The simple reality is the institutions that are educating the largest share of low-income and minority kids, the kids who have the greatest educational needs, have the least to spend on their educations,” said Kati Haycock, president of Education Trust and advocate for educational improvement. “We’re spending roughly 50 percent less per student on students in two-year colleges than we are on public research universities.

“Given the changing demography of this country, that’s not a strategy that’s going to get us where we need to go.”

Wellman cautioned that this burden cannot be placed solely on the institutions in terms of cost cutting and reallocation of resources. She said the bottom line is to investigate and implement new strategies at the state level.

“We need to have a public investment strategy to serve underserved students. That means we need to pay a lot of attention to where the subsidies go,” Wellman said. “We need to look at students’ share of costs. We need to make sure we take pressure off tuition as a primary source of revenue. We also need to make sure the institutions that are serving a large proportion of low-income, minority kids have the resources to ensure their success.”

“To do that,” Wellman said, “we’re going to have to have a return to state investment strategies to make sure that there are sufficient resources.”

More information about the study can be found at www.deltacostproject.org.

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