Source: State Higher Education Executive Officers (SHEEO), 2015
A recession beginning in 2008 dramatically reduced state revenue and ended the growth in state and local support achieved between 2004 and 2008. In 2014, for the second straight year, overall state and local funding for higher education increased, reaching $86.3 billion, up 5.7 percent from 2013, but still below 2008-2011 levels. Initial estimates from the Grapevine survey of FY 2015 appropriations for higher education show continued growth overall of 5.2 percent in nominal terms. These data all point to continuing economic recovery and restoration of state funding for higher education on average nationally.
In addition to state and local revenues, public institutions collected net tuition revenue of $64.3 billion in 2014, for a total of about $150.7 billion available to support higher education. For the first time since the recession, the share of overall funding for public and private higher education from tuition decreased slightly to 42.7 percent (see Figure 1). Net tuition revenue as a share of public higher education revenue was 47.1 percent.
Of the $86.3 billion in state and local support during 2014, 76.8 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 declined 0.3 percent to 7.7 percent in 2014, although funding was increased slightly. The remaining 3.2 percent supported students attending independent institutions, operating expenses at independent institutions, 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 also increased for the second year in a row to $6,552, 5.4 percent above 2013. In 2010, 2011, and 2012, the per-student state and local support were the lowest in the last 25 years. Although 2014 per-student state and local support increased, it still remains significantly lower than pre-recession levels.
Highlights of the SHEF report provided below illustrate the long-term patterns, shorter-term changes, and state-level variables affecting the resources available to support higher education between 1989 and 2014. These and other factors that shape higher education funding are examined in more detail in the sections of the full report that follow….
Data – Raw data, interactive charts, tables and figures from the report, and state wave charts
Project – Information about the SHEF project and technical papers
Process – Information for state SHEF data providers.
Webinar – A brief history of the report and metrics; findings; and new interactive components.