Pioneer Institute report misses real problem

A critical report by the Pioneer Institute says growing out-of-state enrollment at the University of Massachusetts is bad for in-state high school graduates, but the report does not address the reason why UMass needs more out-of-state students to boost revenue. That reason? Low levels of state funding force UMass administrators to find private money to fund the UMass system’s continuing transformation into one of the nation’s top public universities.

The transformation and improvement of the UMass system over the past decade has many benefits, such as UMass Amherst becoming one of the top public universities in the country. Bigger budgets, and more revenue, have been necessary to accommodate the higher enrollment and campus modernizations needed to maintain UMass’s transformation. But UMass now gets less than 20 percent of its budget from the state, compared to 85 percent in the 1970s, UMass President Marty Meehan said in July 2015.

That means funding sources for UMass have become much more fragmented, with most revenue coming from private sources, such as student tuition and fees, research grants, and corporate sponsorships. With the dearth of state funding, out-of-state students represent a tempting source of revenue because they pay much higher tuition and fee rates than Massachusetts residents.

Administrators, state legislators, students, and families recognize that UMass needs bigger budgets to build a better reputation. Yet, perplexingly, the Pioneer researchers seem to think that improving public higher education can be done with less capital investment and lower revenues.

The Pioneer Institute report researchers attempt to explain away the state funding issue, writing in the report that state funding for UMass increased by $200 million between 2005 and 2016. But their figure for state funding in fiscal year 2016 may be inaccurate.

Greg Sullivan, Pioneer’s research director, said in an interview that the report’s authors used the publicly available 2008 and 2016 operating budgets to determine the state appropriation for 2005 and 2016. However, the 2016 figure they use is just a budget projection, while the 2005 figure is the actual amount of funding appropriated by the state.

UMass budget projections for state appropriations have been inaccurate in the past. For example, UMass estimated that it would receive $588.9 million in state funding in the 2009 operating budget, but the 2011 operating budget, which contains the final state appropriation for FY2009, showed that actual state funding in 2009 was only $540 million—almost $50 million less than the university estimated initially. Pioneer should have used the latest final figure for state funding, $570 million in 2014, which is almost $100 million less than the 2016 estimate they cited.

Sullivan responded that the FY2015 state appropriation data were final in the 2016 budget, but the 2016 budget states clearly that the data for 2015 were a projection because the fiscal year had not concluded when the budget was released. Sullivan also said that the authors of the 2016 UMass operating budget had knowledge of both the House and Senate budget proposals when estimating the 2016 state appropriation, and, therefore, the estimate should be accurate.

However, Sullivan did not directly address the fact that previous operating budget estimates have been off by as much as $60 million from the final state appropriation.

Huge cuts in state funding for public higher education began long before 2005, and overall state funding for public higher education actually fell 17 percent between 2007 and 2015, according to the Boston Globe, while the cost of attendance increased by 22 percent over the same period.

These cost pressures lead to many negative outcomes. For one, students are paying a lot more out of their own pockets for a public education. UMass trustees may vote to raise student tuition and fees for the second summer in a row at a meeting in June. UMass Amherst is much more dependent on winning research grants from the federal government and private institutions to fund faculty projects, which means many faculty spend less time in the classroom. The financial  squeeze also results in attempts to undercut workers and the unions that represent them, such as last year’s spat between Meehan and Senate President Stan Rosenberg over the funding of contract agreements.

If Rosenberg, the Pioneer Institute, and Gov. Charlie Baker are serious about ensuring that UMass is an affordable option for the Commonwealth’s working families, they need to acknowledge the effect that very low state funding has on the university’s budget, such as the crowding out of in-state students by out-of-state students who bring in needed revenue.

Baker, Rosenberg, and other state leaders are quick to laud the benefits of UMass’s improving reputation. But they need to realize that those benefits come with a cost. Right now, the Commonwealth isn’t paying its full share of the cost of public universities, and unless Massachusetts leaders decide to pay up, the benefits of a better UMass system will keep flowing out-of-state. 

Medford-based freelance writer Zac Bears is a former editor and columnist for the Massachusetts Daily Collegian, UMass Amherst’s independent student newspaper.