The Real Cost of University Bonds

The much-discussed $4.9 billion in state and university bonds for higher education will cost a bit more than taxpayers might realize. Eva Klein and Associates, the consulting firm that recommended the $3 billion figure, is still under contract. Thus far, the company has been paid $912,180. The majority of that money – 662,180 – comes from overhead receipts (which are collections of money from research grants). The remaining $250,000 is from state taxpayer money. Legislators and proponents are also paying a price in integrity. UNC administrators and Senate leaders have, on several occasions this week, used the the death of UNC-Chapel Hill Chancellor Michael Hooker, who died Thursday from cancer, to push the bonds. “Carmen Hooker urged us to come before you in support of this proposal,” UNC system President Molly Broad told a House Finance Committee on June 29. “He knew this was a good idea,” President Pro Tem Marc Basnight told The Charlotte Observer on Wednesday. “He knew how important the health of the entire system was to each individual campus and to the state as a whole.” Before the full Senate on Wednesday, an amendment by Tony Rand, D-Cumberland County, passed unanimously to name the bill after Michael Hooker.

Burden for Higher Education Falls on Taxpayers, not Students

A study by the Pope Center for Higher Education Policy of the 50 states’ public higher-education systems has found that public institutions in N.C. receive nearly the highest amount per enrolled student from state appropriations, and nearly the lowest amount from tuition and fees. The study (see highlights below) compared the revenue received by each state’s public institutions by source, the state or the student. The revenue from the student comes in the form of tuition and fees, and the revenue from the state comes in the form of appropriations, grants and contracts. This study relied on data for the academic year 1995-96 from the U.S. Dept. of Education and included public 4-year and 2-year degree-granting institutions. A student enrolled in a public institution of higher education in N.C. brought an average of only $1,382 in tuition and fees revenue to public institutions in N.C. Public institutions in only four other states (Hawaii, California, Nevada, Florida and New Mexico) received less tuition and fees revenue per student enrolled. The $1,382 tuition and fees revenue in N.C. was nearly half the national average of $2,377. Taxpayers in N.C. provide the third-highest amount of revenue to public institutions in the form of state appropriations, grants and contracts. Only Alaska and Hawaii taxpayers provided more to their public universities. The average $5,745 N.C. taxpayers provided to the public institutions per student enrolled was much higher than the national average of $4,190. In terms of the revenue per student enrolled received from both sources, students and taxpayers, public institutions in N.C. received $7,127 – 16th highest in the nation and higher than the national average of $6,567. Of that $7,127 public institutions in N.C. received on average for each student enrolled, the student himself paid on average only 19.4 percent. On average, students in N.C. are responsible for less than one-fifth of the cost of their education in a public institution in the state. That percentage is the second-lowest in the nation. Only students in Hawaii pay a smaller percentage. The national average – 35.6 percent – is nearly twice the percentage paid by students in public institutions in N.C. “The picture that emerges from this data is that students pay a small proportion of the total cost of the education in a public institution of higher learning in this state,” said Jon Sanders, director of publications for the Pope Center, who conducted the study. Furthermore, he said,
especially since the cost of a public higher education in N.C. is higher
than the national average, the taxpayers in N.C. are asked to fund a very
large share of the cost of educating students in public institutions of
higher learning in N.C.

The study will be published in the July/August issue of Clarion, and it is
available by contacting the Pope Center at 919-828-3876 or by e-mailing

A comparison of public higher education sources of revenue per student
enrolled (RPSE), 1995-96

RPSE from student (tuition and fees)

1. Vermont $7,289
2. Delaware 4,867
3. N. Hampshire 4,533
4. Pennsylvania 4,148
5. Ohio 3,331
6. Indiana 3,129
7. Michigan 3,005
8. Rhode Island 2,985
9. Massachusetts 2,820
10. New York 2,720
45. N.C. 1,382
Average $2,377

RPSE from state (appropriations, grants and contracts)

1. Alaska $6,519
2. Hawaii 5,809
3. N.C. 5,745
4. Georgia 5,635
5. Mississippi 5,623
6. Arkansas 5,547
7. Iowa 5,521
8. Indiana 5,030
9. Kentucky 5,007
10. Connecticut 4,829
Average $4,190