Mapping Higher Ed Funding Cuts and Tuition Hikes

June 4, 2014 at 9:58 am

Most states in the past year have begun to restore some of the cuts they made to higher education funding after the recession hit.  In almost all states, however, higher education funding remains well below pre-recession levels, as we explained in a recent paper.  The large state funding cuts have led to both steep college tuition increases and spending cuts that may diminish the quality of education for students.

Consider that, nationwide, after adjusting for inflation:

  • The average state is spending $2,026, or 23 percent, less per student than before the recession; and
  • Annual published tuition — the “sticker price” — at four-year public colleges has risen by $1,936, or 28 percent, since the 2007-08 school year.

Click on the map below to learn more about how higher education funding and tuition have changed in each state since the recession.

A highly educated workforce is more crucial than ever to the nation’s economic future.  To rebuild states’ higher education systems in the coming years, policymakers in many states will need to raise revenue or, at the very least, avoid shortsighted tax cuts, which would make it much harder to invest in higher education.

Need to Protect Low-Income Households Up in the Air Under EPA Climate Regulation

June 3, 2014 at 12:42 pm

In my latest post for US News & World Report, I previewed the Obama Administration’s proposal to reduce carbon pollution from existing electric power plants.  It was important to include robust low-income protections in the comprehensive national “cap-and-trade” proposal that Congress debated but failed to enact.  Should the new proposal also include such protections?

At this point, we don’t know.  The new proposal relies on the Environmental Protection Agency (EPA) to establish emissions-reduction goals for each state and approve state plans for meeting those goals.  As CBPP has explained, such a prescriptive regulatory approach will likely be less cost-effective (i.e., it will cost more to achieve a given emissions target) than a comprehensive market-based approach like cap-and-trade or a carbon tax that “puts a price on carbon” and lets market forces determine where emissions reductions come from.  But the consumer impact is likely to be smaller under regulation precisely because the price signal is weaker.

As I say in the US News post:

The Obama administration pledges to give states as much flexibility as possible to meet the new regulations on emissions from existing power plants, and there are several ways to do that, including some that mimic a carbon tax or cap-and-trade, achieving some of the cost efficiencies (but only within the existing power plant sector)…

One leading issue in designing market-based solutions is the impact on consumers, especially low-income households, of putting a price on carbon.  The comprehensive bills that Congress debated in 2009-10 addressed that issue by allocating some of the revenue the government received from selling emissions allowances to consumer relief.  EPA regulation is less cost-effective, but it also has a less adverse impact on household budgets.  But were states to choose more market-based solutions within the EPA’s requirements, such as joining regional cap-and-trade systems, both federal and state policymakers should be mindful of the possible harm to low-income households.

The EPA will issue final guidelines in about a year and states will have until June 2016 to submit plans.  In the meantime, CBPP will continue to urge policymakers to develop policies that are compatible with protecting both the environment and low-income households.

House Cuts in Census Funding Would Carry a Heavy Cost

June 3, 2014 at 12:01 pm

The House voted shortsightedly to cut $238 million from the Census Bureau’s budget for fiscal year 2015 relative to the President’s request.  Although the House funding level is $28.5 million more than last year’s Census budget, it’s far from enough to cover the cost of preparing for the 2020 census and the closely related annual American Community Survey (ACS).  The Senate, which will prepare its own bill this week, should give Census the needed funding to provide high-quality data on which policymakers and private businesses can depend.

In a barrage of amendments to the Commerce-Justice-Science funding bill, House members shifted funding last week from Census to pay for projects ranging from policing to weather research.  The cuts threaten the accuracy of the 2020 census, which will help determine the apportionment of congressional seats and drive redistricting decisions.

They also threaten the accuracy of the ACS, the nation’s main source of state and local data on affordable housing, household income, poverty, race, state-to-state migration, immigration, types of disabilities of local residents, and scores of other major topics.  The federal government uses ACS data to distribute more than $400 billion in federal formula funds each year, and the information helps communities and businesses decide where to build new roads, bridges, schools, homes, and stores.

The bill could prove costly to taxpayers in the long run by delaying adoption of innovative cost-saving steps such as online data collection, which could save $5 billion or more over ten years, according to the Census Bureau.

It could prove shortsighted in other ways as well, such as by weakening the quality of the information that helps inform policymaking.  For example, the Justice Department’s Community Oriented Policing Services (COPS) program — the biggest beneficiary of the House funding shuffle — requires law enforcement agencies applying for grants to submit data from the ACS.  Presumably that’s because policymakers believe that ACS data keep the program well targeted, but they can’t do that job as effectively if underfunding weakens the survey’s quality.

Further, a proposal by Representative Ted Poe (R-TX) that the House adopted takes another swipe at the ACS by making responding to the ACS “voluntary” for households.  A similar move by Canada in 2011 proved disastrous:  response rates plummeted from 94 percent to 68 percent, severely damaging data quality while raising costs, according to The Census Project.  Decades of experience show that a mandatory survey — regardless of whether it’s enforced with stiff penalties (which the requirement to fill out Census forms is not) — has far higher response rates and thus yields far more accurate data at lower cost. 

The House cuts come at a time when other areas of the Census budget are already tight.  Census is redesigning its Survey of Income and Program Participation (SIPP) to save money and reduce respondents’ burdens, for example, but that redesign effort is running into problems and the savings probably won’t appear as soon as earlier predicted.  Compromising the quality of Census data through severe underfunding would be penny-wise and pound-foolish.

Identifying Low-Income Students in Community Eligibility Schools for “Title I” Purposes

June 2, 2014 at 5:22 pm

Most schools use applications for the school breakfast and lunch programs to determine students’ income levels for the federal “Title I” program for disadvantaged students, our new report explains, but schools offering community eligibility — a new option that allows schools in high-poverty areas to serve free meals to all students without charge — no longer collect those applications.

Community eligibility thus has important implications for Title I of the Elementary and Secondary Education Act, which provides federal funds to improve the achievement of the most educationally disadvantaged students.  The most important implications relate to allocation of Title I funds among schools within a school district and Title I accountability policies requiring schools to monitor achievement levels for students from low-income families and take appropriate action when those levels are inadequate.

For the vast majority of public schools, approval to receive free or reduced-price school meals has been the primary, often the sole, indicator of low family income for Title I purposes.  Schools or school districts that adopt community eligibility no longer collect those data, so districts must find other ways to assess students’ income levels.  Fortunately, comprehensive policy guidance from the U.S. Department of Education gives districts a wide range of options to choose from so they can implement community eligibility with minimal interference with Title I.

Our new report explains what the options are.

In Case You Missed It…

May 30, 2014 at 2:28 pm

This week on Off the Charts, we focused on child nutrition, SNAP (formerly food stamps), and the federal budget and taxes.

  • On child nutrition, Zoë Neuberger explained that the agriculture funding bill that the House Appropriations Committee approved this week would gut new school meal standards.  She also highlighted a rebuttal from several nutrition scientists to arguments for requiring the WIC nutrition program to provide white potatoes.  And she excerpted an op-ed explaining how the “community eligibility” option, which enables schools in high-poverty areas to provide meals to all students at no charge, is helping West Virginia.
  • On SNAP, we presented new data showing that SNAP spending and caseloads are falling.
  • On the federal budget and taxes, Chuck Marr pointed out that permanently extending the “bonus depreciation” tax break would be economically unjustified and fiscally irresponsible.  Richard Kogan explained why adopting so-called “fair-value accounting” for federal loan programs would distort budgeting.

In other news, we issued papers on declining SNAP costs and the effort to make bonus depreciation permanent.  We also updated our paper on why some of the proposed Medicare Part D regulations dropped by the Administration were sound, our chart book on the legacy of the Great Recession, and our paper on how many schools and school districts in each state qualify for community eligibility.

Chart of the Week:

A variety of news outlets featured CBPP’s work and experts recently.  Here are some highlights:

Americans Move for Many Reasons, But Rarely to Flee High Taxes
Fiscal Times
May 30, 2014

Economic Upswing Has Fewer Americans Receiving Food Stamps
The Salt
May 29, 2014

State support for public universities has plummeted
Denver Post
May 28, 2014