Higher Education

Why two states have poured money into public higher education

GRAND FORKS, North Dakota — Construction cranes sprout like stalks of wheat from the windswept, tabletop-flat campus of the University of North Dakota.

More than a quarter of a billion dollars’ worth of new facilities are going up here or have been opened in the last few years. Another $80 million is being spent at North Dakota State University, an hour and a half south in Fargo, where carillon bells blare the fight song every afternoon at 5. And $179 million more was approved for public universities and colleges statewide by the last session of the legislature, along with $12 million for research and nearly $40 million for raises and increased operating and utility costs.

A stark contrast to the worn and demoralized condition of public higher education in much of the rest of the United States, these bustling campuses populated by purposeful students are exceptions that prove a troubling rule:

In a time of frantic calls to raise the number of Americans with university degrees who will be needed to feed the globally competitive knowledge economy, only two states — North Dakota and Alaska — have increased spending per student on higher education, when adjusted for inflation, since the economic downturn, according to the independent Center on Budget and Policy Priorities.

University of North Dakota. (Photo: University of North Dakota)

North Dakota State University

The rest have cut their public universities not just slightly, but by a dramatic 23 percent, on average, the center reports. In Arizona, Louisiana, and South Carolina, funding is down by more than 40 percent since the start of the recession.

Why have North Dakota and Alaska — conservative states with Republican governors and Republican-controlled legislatures — increased higher-education spending 61 percent and 20 percent, respectively, since 2008?

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First, of course, they have the money, thanks to oil and gas production, as is instantly evident in North Dakota from the “Drill Baby Drill” T-shirts in the Bismarck airport gift shop and the endless trains of oil tankers rumbling south across the plains. (How flat is North Dakota? Locals like to say you can sit on your porch and watch your dog run away for three days.C

Percent change in state spending, per student, on higher education since 2008. Source: Center on Budget and Policy Priorities. CLICK TO ENLARGE

But these two historically pragmatic and comparatively frugal states — the maces used at graduation ceremonies at two North Dakota campuses were originally wooden banister columns — have also determined that withdrawing support from higher education does more than force students and their parents to fork over more of the cost.

They’ve decided that producing educated workers and supporting university research are essential to the continued success of their economies.

“It’s enlightened self-interest,” said David Bergeron, vice president for postsecondary education at the Center for American Progress, which in a report in October said a falloff in financial support for public universities and colleges nationwide is undercutting wages, the creation of new businesses, and — in a never-ending cycle — the very tax revenues states need to put money back into their campuses.

“We’re hurting ourselves in the long term because of our lack of investment in higher education,” said Bergeron, a former assistant U.S. secretary of education. “If you want to have a vibrant economy in your state, you have to invest in your people. That’s what North Dakota and Alaska have recognized that other states are slow in recognizing.”

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It’s a seemingly obvious conclusion, but it’s often hard to see. In North Dakota and Alaska, however, the energy boom has made it eminently visible.

North Dakota residents with only high school diplomas can land $60,000-a-year jobs driving trucks or manning oil rigs. But for the best and even higher-paying positions — petroleum engineer in the energy industry, for instance, which the Bureau of Labor Statistics says pays an average of $162,860 annually — the industry has been importing people from other states with university degrees. In all, North Dakota has more than 25,000 job openings, according to the official state job service, with predictions that could grow to 80,000 by 2025.

We’re getting good folks out of there,” state Representative Mark Sanford, chairman of the legislature’s Higher Education Funding Committee, said of the public universities. “We just need more of them.”

Putting money into universities has another impact, too, said William Eerdmans, a petroleum engineering major at the University of North Dakota: “It actually affirms to students that their educations matter.”

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But it’s not only graduates themselves who benefit from college educations. Research at UCLA finds that a single percentage point rise in the number of graduates in a state raises everyone else’s wages. And a government study in the U.K. of 15 countries, including the United States, credits at least one third of their collective increase in labor productivity since the mid 1990s to the number of people who got graduate degrees during that time.

University of North Dakota. (Photo: University of North Dakota)

North Dakota State University

“People here have made that connection” between higher education and the economy, said Andy Peterson, CEO of the Greater North Dakota Chamber of Commerce. “They do get it. The business community gets it. We understand that 70 percent of all jobs are going to require a college education by somewhere around the year 2020, and we’ve got to grow our own.”

In an “uber-competitive world market,” Peterson said, “you’ve got to embrace higher education.” If you don’t, he said, employers “will pass you by.”

So, among other things, the University of North Dakota began a program in petroleum engineering that has grown from an inaugural class of four students four years ago to 285 now.

“The convincing argument is about the long term — that you need the engineers and the scientists to contribute to the economic development of the state, not just now but for years to come,” said Hesham El-Rewini, the university’s dean of engineering.

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It’s an argument the public universities in North Dakota have been unusually forceful in making. El Rewini and several colleagues take a statewide bus tour every summer to promote their programs to residents who pay for them through their taxes, for example. Dean Bresciani, president of North Dakota State, writes op-eds for North Dakota newspapers on topics such as, “What is the value of higher education?” and, “Why North Dakotans win with research universities.”

“We have a duty to the taxpayers, to the legislature, to the state, to explain our value,” said El Rewini, outside whose office land is being readied for a new building to house a collaborative energy center. “Higher education in general, not only in North Dakota but everywhere in the United States, needs to make a better case for itself.”

That’s another thing that distinguishes North Dakota from many counterparts, said Bresciani, whose doctoral dissertation was about public support for higher education: Academics in most places are “horrible, absolutely horrible” at making this case. “We’ve relied on this, ‘Trust me, I know what I’m doing.’”

College presidents elsewhere “often back away from talking about economic development, because they see the purpose of higher education as broader, and it is,” Bergeron said. “But if you can’t make that argument about economic development, you never get to the rest of the story.”

Whatever the reason, even when Alaska, North Dakota, and other energy-rich states are taken out of the equation, only Illinois, Maryland, New York, and Vermont have raised spending on higher education by a total of more than 2 or 3 percent each across the five years since the downturn, according to the Center for the Study of Education Policy at the University of Illinois — and, in Illinois, mostly because of an infusion of money for retiree pensions, not new programs or buildings.

As the economy has slowly rebounded, some other states have started to put money back into higher ed, the University of Illinois center reports. The upswing has actually slowed in Alaska, where the decline in oil prices has hurt tax revenue, but some states, including Florida and California, have made double-digit increases this year. Overall, however, after years of bloodletting, most states are still behind where they were in 2008.

“If you talk to the leaders in any state, they all see the value of it, or most of them do,” said George Pernsteiner, president of the State Higher Education Executive Officers Association and former chancellor of the Oregon University System. “The problem is that having to deal with all of the other things they have to spend money on, you wind up being unable within the structures of our political system to make the kinds of investments you know you need to make.”

Even with the surge of spending, things have not gone entirely smoothly in North Dakota. In exchange for state largesse, the public colleges and universities are being forced to work more as a system and to meet performance goals, such as making sure their graduates get jobs. So much political infighting has resulted, it led to a ballot measure in November calling for a wholesale change in the way the universities are governed, though the referendum failed.

Now other North Dakota legislators are proposing using oil revenue to make public colleges tuition-free for students who maintain good grades.

The continued withdrawal of support in other states, by contrast, “is economic nonsense. I’m at a loss to explain it. If you look at the economies that are growing the fastest, it’s countries like China and India that are building their higher education infrastructures,” Bresciani said.

“It’s almost like our country is the last to see the value.”

This story was produced by The Hechinger Report, a nonprofit, independent news website focused on inequality and innovation in education.

Reproduction of this story is not permitted.

 

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