Southeast rebuttal to Lumina study on higher education

COMMENTS ON LUMINA FOUNDATION STUDY OF DISPARITY IN ACCESS TO POSTSECONDARY EDUCATION

January 7, 2002

Southeast Missouri State University

Attribute to Art Wallhausen, associate to the president

1. We did not see the study until this morning, so it will require more careful analysis than we have been able to give it in a couple of hours, but here are some preliminary comments.

2. It is useful to have a national study which raises the concerns we at Southeast have had since the early 1980s -- namely, that state higher education policy has placed more of the burden of funding a college education on the student and his or her family and less on the state. It was state policy which required institutions to obtain at least 28% of their operating funds from incidental fees, when that percentage had been less than 15%. And then in the early 1990s, by default, that percentage rose another 5 to 9 percent when the state cut appropriations.

3. So the general findings of the Lumina study underscore the need for policy makers to consider whether current funding policies are appropriate -- both in the amount of state appropriations to institutions and in the amount of financial aid available to low and medium-income students. The study also underscores the need for all institutions to look carefully at their budgets and to effect all appropriate economies of operation, as we do on a continuing basis at Southeast,

4. We are concerned about the affordability of college attendance, but we do not believe the term "unaffordable" with regard to low-income students is applicable at Southeast, and we believe the report's methodology is flawed. At the very least, given that methodology, the report should not attempt to label institutions as "unaffordable." Here is why:

--The study's affordability determinations are based on hypothetical scenarios, and not on actual data from campuses or interviews with students. In other words, the report is making a judgment about institutions in the absence of "real" data about which type of students attend an institution and how they finance their education.

--The hypothetical scenarios are based on broad generalizations and averages. For example, the determination of affordability may hinge on nothing more than the institution's classification as residential or commuter. (At Southeast, which we assume is classified in the report as "residential," only about a third of undergraduate students live on campus, so the cost of attendance including room and board does not apply to most of our undergraduates. The majority of our students live at home with parents or off-campus, so the University's room and board charges are not applicable to them. Further, a substantial number of Southeast students are able to attend classes close to their homes by attending one of the four area higher education centers created by the' University to enhance access and keep costs low for students. The hypothetical scenarios of the Lumina study also fail to take note of unique situations, such as the fact that Southeast is one of very few in the nation operating a textbook rental system to save students several hundred dollars each year. These are just factors ignored by the Lumina study which come to mind in a hasty appraisal of the report.)

--The report provides no "real" basis for comparing the affordability of institutions, but merely applies labels unsupported by factual data for individual universities. This makes it impossible to determine whether the report is accurate in its assessment of affordability. We question the report's findings with regard to Southeast because, for example;

o In FY1999, incidental and general fees at Southeast totaled $103.50 per credit hour, while those at Southwest totaled $109.42. Yet, the Lumina study ranks Southwest as "affordable with loans" and Southeast "unaffordable" for low income students. Fees at Northwest totaled $90.75, and those at Central Missouri

State totaled $91.00. Yet Central is rated "affordable with loans" and Northwest "unaffordable'" for low income students. We see no rationale for the different ratings based on these numbers.

-- Because the data are from Fiscal Year 1999 (Fall 1998), one can question whether the conclusions based on three-year-old data are still valid. This is another reason the "unaffordable" labels should not be applied in 2000-2001. We are concerned that students and parents reading the Lumina report labels will not recognize that some of these data, even if they may have been valid in 1998-99, are not valid in 2001-02. For example:

* The report fails to show data such as those revealing that since FY1995, the average annual fee increase at Southeast has been the lowest of any of the state's major four-year institutions (4.4%), while increases at Southwest and Central have averaged over 7% per year during the eight-year period. Southeast students taking 12 credit hours pay $366 more this year than they did in Fiscal Year 1995, while students at Central pay S492 more and those at Southwest pay $564 more. Yet, the report places Central and Southwest in the "affordable with loans" category. The "unaffordable" category unfairly places Southeast in company with the University of Missouri-St. Louis and the University of Missouri-Columbia, where fees have risen $911 and $815, respectively, for 12 credit hours over the past eight-year period -- more than double the Southeast increases.

* In Fall 2001, the cost of 12 credit hours was $1,410 at Southeast and $1,541 at Southwest. The total cost per semester of 12 credit hours at Southeast ($1,410) is practically identical to the cost at Central ($1,404). That was before the mid-year fee surcharge announced by Central in December. Yet the Lumina report ranks Central as "affordable with loans" and Southeast as "unaffordable." We find this incomprehensible.

* The federal Pell Grant program has changed significantly since 1999. For example, in the last two years, the amount of this grant (not loan) to low-income students has increased approximately $750 per year -- very likely moving some institutions into the "affordable" categories, even using the disputed methodology of the Lumina study.

5. Southeast continues to keep fees as low as possible, given the need to maintain a quality educational experience, and continues its efforts to expand affordable access by providing alternatives such as the area higher education centers, instructional television, and Web-based instruction for the people of this region.

6. We understand that regardless of the amount of fees, some students and their parents would have difficulty paying for the cost of college attendance, but we are concerned that applying the incorrect label of "unaffordable" to an institution can discourage students and their parents from looking at the real possibilities for financing the college experience with a combination of federal and state funds, loans, and contributed financial aid. This can only be determined on an individual basis, not by applying general criteria as does the Lumina study.

7. Finally, the University is already looking at ways to deal with unmet need in instances where the combination of government aid and loans is not sufficient to pay for college costs. A committee at the University is presently looking into the possibility of increasing the institution's need-based aid available to low-income students. The report of this committee is expected to be available for consideration in the near future.