Why Is Cost Cutting Never An Option For Our Universities?

Now that the Legislative session is over North Dakota’s universities are turning to the issue of tuition and fees for students for the coming academic years. And, not surprisingly, North Dakota students will once again see a hike in what they’re paying despite generous budget increases from the taxpayers.

At the University of North Dakota, specifically, students will 2.5 percent increase in tuition – the maximum allowed by the Legislature this biennium – and a more than 6.2 percent hike in the cost of room and board.

Williston State College, North Dakota State College of Science, Dakota College at Bottineau, Dickinson State University, Mayville State University, Minot State University and Valley City State University will also raise tuition the maximum 2.5 percent as well. North Dakota State is looking at a 2.4 percent increase, while Lake Region and Bismarck State are each looking at about a 2 percent increase.

But you have to wonder why these universities are increasing costs for students at all.

Lawmakers just appropriated over $927 million to the universities for the coming biennium. While that’s less than the $1.012 billion requested by Governor Jack Dalrymple in his executive budget, it’s still about a 2 percent increase over the previous biennium appropriation. And it comes after the state averaged a 24 percent increase in university system appropriations every biennium since 2005.

Here’s a graph showing the trend based on the appropriations in HB1003 (the NDUS budget) and Legislative Council’s numbers for full time equivalent enrollments and historical appropriations.

From the 2005-2007 biennium through the 2015-2017 biennium which will begin on July 1, appropriations to the university system have increased 137 percent.

Full time equivalent enrollment, on the other hand, has increased just under 9 percent.

So, again, why are the universities needing to increase costs to students given the generosity of the Legislature and the taxpayers? Despite the appropriation increase, the universities say they have a “shortfall” because their “cost to continue” needs weren’t fully funded:

But even though UND—and most other NDUS institutions—is seeing an increase in state funds, it is also taking a hit to its budget because of what is called the cost to continue, that is, salary adjustments, increases in health insurance and higher utilities costs, said NDUS Vice Chancellor for Administrative Affairs Laura Glatt.

UND will fall short by around $4.9 million when it comes to those costs.

“That means they’re going to have to find money elsewhere in their budget to make up for that shortfall,” Glatt said.

Does anyone honestly believe that the universities don’t have any room in their budgets to absorb these “cost to continue” expenses for a biennium or two? And can we stop the talk of budgets falling short and taking a hit because the universities didn’t get every single dime they asked for?

That’s the problem with the universities (and a lot of government enterprises). No matter how much money you dump into them, it’s never enough. But in this instance those typical budget politics are particularly obnoxious because it’s the students who feel the brunt of the impact.