Higher Education

LFDA Editor

In Brief:

  • New Hampshire has the lowest state funding for higher education in the US and the highest average in-state tuition for public colleges and universities.
  • The state legislature has increased university funding since the 2008 recession, and the university system has been able to slow tuition increases.
  • There are a range of different policy approaches that can be used to try to get the most ‘bang for your buck’ from public higher education.
  • Pro: The lack of state funding for higher education in New Hampshire is the cause of high in-state tuition, which burdens students with debt, drives young people out of state, and drags down the whole economy.
  • Con: The University of New Hampshire has made questionable spending decisions that prove the system should tighten its budget before the state significantly increases funding.

Issue Facts:

Public colleges and universities are higher education institutions founded by state governments and partially funded through state tax dollars.

New Hampshire’s public colleges and universities include the University System of New Hampshire, the Community College System of New Hampshire, Keene State College, Plymouth State University, and Granite State College. They are funded through a combination of state money, federal funds, tuition and fees, and private donations. 

The New Hampshire Legislature does not have control over the entire university system budget or what they charge for tuition.  Instead, the Legislature decides how much state funding to give public higher education every two years as part of the state budget.  Leaders at New Hampshire’s public colleges and universities then decide how to spend that money and set tuition rates.

Current higher education funding in New Hampshire

New Hampshire funding for public colleges and universities is low compared to other states.

On average, public colleges and universities in the United States get about one-fifth of their funding from state government. In New Hampshire, state funding only covers about one-tenth of the budget for the University System of New Hampshire. 

According to data from the College Board, in 2016 New Hampshire had the lowest state funding for higher education in the United States, at $2,900 per student (based on total enrollment). 

Tuition and fees cover most of the difference.  In New Hampshire, tuition and fees make up over one-third of the revenue for public colleges and universities, compared to a national average of 21%.

It is not surprising, then, that New Hampshire public colleges and universities also the highest average in-state tuition in the United States, at $15,650 in 2016. (The national average was $9,650.)

Historical highs and lows for university funding

Funding for public colleges and universities was much higher before the recession. In 2001 New Hampshire funding per student reached a high of $5,515

However, due to falling tax revenues, the 2011 New Hampshire Legislature cut college and university funding by roughly half, down to less than $2,000 per student.  The University of New Hampshire raised tuition at its four-year colleges by about 10% to cover the loss. 

The Legislature restored about half of that higher education funding in the next state budget, in 2013. New Hampshire’s two-year community colleges and four-year institutions were both able to freeze tuition for the next two years. 

In 2015 the Legislature once again increased college and university funding, but this time only by about 5%. The community college was able to actually cut tuition at that point, but the University of New Hampshire broke the freeze and raised tuition at four-year colleges again.

In 2017, the most recent budget year, the Legislature level-funded the University System of New Hampshire but gave the Community College System more funding. In return, New Hampshire’s community colleges have promised another tuition freeze. Tuition is expected to continue to increase at New Hampshire’s four-year public colleges and universities.

Alternatives to increasing state funding

Most legislators agree that New Hampshire residents benefit from lower tuition at public colleges and universities. Raising state funding isn’t the only way to keep college affordable for Granite Staters, however.

There are also various state and federal student loan programs that help students afford college – at least in the short-term. However, some critics argue the wide availability of student loans just enables colleges to raise tuition.

Efficiency
The Legislature has expressed interest in how the university system could spend more efficiently. For example, public colleges and universities could offer more courses online, limit spending on athletics, or use more adjunct faculty instead of tenured professors. 

Alternative funding formulas
One way the Legislature could push for public colleges and universities to spend more efficiently would be to link funding to student enrollment or educational outcomes, instead of granting an arbitrary lump sum.

Spending caps
Some states have passed laws to cap how much universities may raise tuition, such as limiting increases to a certain percentage each year, or tying them to changes in the state’s median income. Others legislate how much universities can spend on certain programs. These caps can keep tuition low, but might put more pressure on legislators to use state funds to make up any shortfall in a school’s budget.

In Maryland, lawmakers have addressed this challenge by creating a stabilization fund—a special ‘rainy day’ fund for the public university system which can be tapped when revenue drops or costs go up to take the pressure off tuition rates.

Funding financial aid
Some states allocate additional spending to financial aid, rather than general institutional aid. The goal of this policy is to see that the extra money is targeted toward helping poorer students who might not otherwise be able to afford college. However, critics express concern that the “sticker shock” of overall tuition rates might intimidate some out of applying at all. 

Competition
Colorado has experimented with a sort of voucher program, which gives every college student a stipend for credits at either public or private colleges.  Ideally this program forces public colleges to compete with private colleges to offer the best value for students.

Related Issues

Budget 2018-2019
Jobs, Trades, and Skills Training

PROS & CONS

"For" Position

By LFDA Editor

 “New Hampshire should increase funding for higher education.”

  • According to almost any measure, New Hampshire provides the lowest support for public higher education of any state in the U.S.  For example, a study from the State Higher Education Executive Officers Association found that New Hampshire allocates just 1.9% of tax revenues to higher education, compared to a national average of 5.7%. 
  • As long as New Hampshire’s support for public colleges remains low, tuition is most likely going to remain high.  This doesn’t just hurt students and their families in the short-term.  In the long-term, it burdens students with debt that limits their job prospects  (for example, most health care students can’t afford to work in low-income or rural areas, where salaries are lower, and still make loan payments). It also makes them less likely to make large investments, such as purchasing a home. This has a negative effect on the entire economy. 
  • A higher percentage of students in New Hampshire leave the state to go to college than anywhere else in the US, with the sole exception of Vermont. This makes it more likely those young people will permanently settle out-of-state, exacerbating the challenge of New Hampshire’s increasingly aging demographics. Lowering in-state tuition could help entice students to stay here instead of moving away.  
  • The university system demonstrated its commitment to cost-cutting in 2013, when it froze tuition despite not getting all the funding it requested from the Legislature.  If the state increases university funding in the future, legislators can be confident students will see the difference in their tuition rates.
  • According to a nation-wide 2009 study from Research in Higher Education, every $1 of taxpayer money spent on higher education has a return of $2.35 in future tax revenue and savings on social services. (Though New Hampshire lacks a sales or income tax, the study also looked at the property taxes residents eventually pay, and these make up a significant portion of the Granite State’s revenue.)

"Against" Position

 “New Hampshire should not increase funding for higher education.”

  • The average in-state tuition and fees for New Hampshire community colleges have actually decreased in recent years.  According to data from the College Board, the only other state to lower community college tuition during that time was Minnesota. 
  • The University of New Hampshire has not demonstrated it spends state money wisely.  For example, in 2016 the university spent $17,570 on a single light-up table at the dining hall. 
  • From 2005 to 2015 the amount UNH Durham spent per student (including graduate students) increased by 33%.  That’s faster than the rate of inflation over the same time period, about 21%.  Did the university really increase the value of education by that much over just ten years?  This spending growth suggests there is room for UNH to cut its budget.
  • The higher tuition at the University of New Hampshire is matched with a high quality education.  According to the U.S. News and World Report rankings of universities, UNH Durham tied for 49th out of 133 public colleges and universities in the United States. Tuition rates don’t need to decrease if students are receiving a higher-quality education. ()
  • Rather than increase funding for the university system overall, the state should focus on financial aid for students pursuing degrees in fields that have a shortage of qualified workers, such as the health care field.  To learn more about efforts to educate a new generation of workers in critical fields, visit our Jobs, Trades, and Skills Training issue page. 

LEGISLATIVE HISTORY

Tabled in the Senate

Establishes a skilled technology worker recruiting trust fund in the Treasury Department for the purpose of providing student debt relief. This bill appropriates $4 million over the next two fiscal years for the program.

Retained in Committee

Requires the Adjutant General's Department to include at least $25,000 for the New Hampshire National Guard Scholarship (NHNGS) Fund in the Department's budget request each year.

Killed in the House

Allows a town to establish a scholarship fund.

Signed by Governor

Requires the University System of New Hampshire and the Community College System of New Hampshire to provide detailed budgets upon legislative or executive request.

Retained in Committee

Requires the trustees of the university system to submit a report detailing the operating budget for each institution in the university system for the next fiscal year.

Tabled in the House

Establishes the John and Molly Stark student debt reduction program, which would provide grants to New Hampshire residents who attend UNH and agree to work in New Hampshire for four years after graduation. The bill appropriates $1.2 million over the next two fiscal years for the program.

Killed in the House

Establishes the John and Molly Stark workforce opportunity program, a scholarship program for qualifying New Hampshire students enrolled in the Community College System of New Hampshire. The bill appropriates $1 million over the next two fiscal years for the program.

Killed in the House

Establishes a college scholarship program for UNH students pursuing careers in social services, such as nursing. Applicants would have to agree to work in New Hampshire for at least four years after graduating. The bill appropriates $1 to start the program.

Killed in the House

Establishes a college scholarship program for UNH students pursuing careers in health care. Applicants would have to agree to work in New Hampshire for at least five years after graduating. The bill appropriates $1 to start the program.

Retained in Committee

Amends the Children's Savings Account Program. State law requires a pilot program in Manchester and Coos county that gives each kindergarten student a $50 savings account. This bill expands the program to any student who completes a financial literacy program in the second grade or later. The bill also appropriates $5 million for the program over the next two fiscal years, and raises the mutual fund registration fee by $100 to support the program. These funds would allow additional state contributions to each child's savings account.

Retained in Committee

Establishes a program for students in grades 11 and 12 interested in taking science, technology, engineering, or math courses, previously approved by the University System of New Hampshire or Community College System of New Hampshire, for college credit at a state-funded rate of $250 per course.

Killed in the Senate

Establishes a committee to study the feasibility of transferring authority over the University System of New Hampshire's budget to the Legislature. The House amended the bill to instead study how the university and community college systems spend taxpayer money, and how to increase accountability.

Killed in the House

Urges legislators to support bills to ensure that students from New Hampshire have access to debt-free higher education at public colleges and universities.

Tabled in the Senate

Establishes the New Hampshire college graduate retention incentive partnership (NH GRIP) which provides $1,000 annually for four years to an in-state college graduate who is hired by a participating in-state employer.

Should NH increase funding for higher education?

FOR
REPRESENTATIVES

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Issue Status

Several proposals for new scholarship programs were shot down this year, while this year's budget for USNH saw it level-funded at $162 million. Community colleges got an increase in funding of $7.3 million.

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