State Higher Education Finance FY 2013

Source: State Higher Education Executive Officers (SHEEO), 2014

…. By 2012, however, these ARRA funds had largely been spent and state and local support for higher education fell 7 percent to $81.1 billion. The decline in 2012 due to the expiration of ARRA funding (the “fiscal cliff”) was widely and accurately projected, based on a fear that the recovery of state economies and revenues from the 2008 recession would be sluggish. In 2013, state and local funding for higher education increased slightly to $81.6 billion, showing initial signs of a slow economic recovery. Appropriations in 2014 show an overall increase of 5.7 percent indicating continued growth and recovery. (Please see the Grapevine Report for details.) In addition to state and local revenues, public institutions collected net tuition revenue of $ 61.4 billion in 2013, for a total of about $143.0 billion available to support the general operating expenses of higher education (see Figures 1 and 2). Of the $81.6 billion in state and local support during 2013, 76.5 percent was allocated to the general operating expenses of public higher education. Special purpose or restricted state appropriations for research, agricultural extension, and medical education accounted for another 12.2 percent of the total. The percent of total support allocated for financial aid to students attending public institutions increased to 7.9 percent in 2013. This is up from 5.6 percent in 2007 and 2008 and shows the efforts states made to maintain critical aid programs during the downturn. The remaining 3.4 percent supported students attending independent institutions, independent institutions’ operating expenses, and non-credit and continuing education expenditures. Further analysis of the data indicates that constant (adjusted for the impact of inflation over time) dollar per student state and local funding for public colleges and universities reversed the annual decline that began in 2009, increasing slightly in 2013 over 2012. State and local support (excluding appropriations for research, agricultural extension, and medical education) per full-time equivalent student was $6,105 in 20 13, an $85 (or 1.4 percent) increase, in constant dollars, from 2012. In 2010, 2011, and 2012, the per-student state and local support were the lowest in the last 25 years. Although 2013 per-student state and local support increased, it still remains lower than any of the years prior to 2009. It should be noted, however, that most of the growth in state and local support was due to increases in local support. Further, there was considerable state variation, with increases seen in 30 states and decreases continuing in 20 states. ….
Related:
View this year’s SHEF Report and related tables and figures, FY 2013
View the 2013 Grapevine Compilation of State Fiscal Support for Higher Education