Despite Its Big Spending, N.C.’s Higher Ed Budget Tackles Big Issues

“‘Bipartisan’ usually means that a larger-than-usual deception is being carried out,” comedian George Carlin once quipped.

Perhaps, then, North Carolinians should be suspicious about the fact that the University of North Carolina system’s president, a Democrat, and its Board of Governors (BOG) chairman, a Republican, have sung praises for the system’s latest two-year budget. 

The budget was signed into law by Governor Pat McCrory on September 18 after a lengthy battle between the state’s House and Senate.

And it is very generous to the university. The system’s current $2.65 billion state operating budget will expand by roughly $100 million in 2015-16 and $35 million in 2016-17. The increase is a major departure from McCrory’s budget proposal, released last March, which would have reduced spending by about 1 percent. 

All that additional money made the bipartisan leadership of the university system very happy. “We are grateful to the legislative leadership for their continued commitment to address the needs of the UNC system,” said system president Thomas Ross in a press release. “The budget…is the best the UNC system has seen in recent years,” added BOG chairman John Fennebresque. 

Such praise from such quarters should be taken as a clear signal to start reading the budget’s fine print. Indeed, university officials received almost everything they asked for, and then some (and they may be getting even more over the next two years if a proposed bond package is approved by voters in a 2016 referendum). Roughly $100 million will fund projected enrollment increases at the state’s 16 public universities. Twenty-seven million dollars will be used to provide pay bonuses to UNC employees. Millions more will be spent on a program that offers non-resident veteran students in-state tuition prices.

Like almost every university budget, the latest one is rife with special interest handouts and dubious spending initiatives. East Carolina University’s Brody School of Medicine, for example, is receiving a $16 million bailout. The medical school has struggled in recent years because of waste, inefficiency, and a lot of “mission creep” that has caused it to expand beyond its means. (In 2013, for example, the school suffered a $14.4 million operating loss.)

The goodies were scattered around the state. Some other examples include:

  • $16 million will be used to fund surgery and family medicine residencies at the Mountain Area Health Education Center in Asheville, North Carolina. This is part of an ongoing effort on the part of state policymakers who want to keep more doctors and medical professionals in the state upon graduation, and it reeks of central planning.
  • Elizabeth City State University, which has had steep enrollment declines since 2010 and recently had its credit rating downgraded by Moody’s Investors Service, is receiving $6 million to enhance its IT infrastructure and develop new student recruitment tools.
  • Appalachian State University is receiving almost $300,000 to recruit community college students. 

But for all that’s wrong with this budget, there’s also a lot that’s good. Several provisions constitute significant victories for the public.

Take, for instance, the portion of the budget related to Western Governors University (WGU). WGU is an online university that was established in 1997 by a group of U.S. governors who wanted to provide high-quality, low-cost postsecondary education to working adults. Unlike traditional brick-and-mortar schools, which focus on seat time and credit hours, WGU has adopted a “competency-based” educational model that allows students to “demonstrate their skils and knowledge at a pace that suits them.” 

WGU would be a boon to the 1.5 million North Carolinians who have some college course credit, but no degree. It also would help to fill the state’s math, science, and special education teacher shortages. The online university will receive a $2 million state grant if it can raise another $5 million of private funds.

Also included in the budget is a directive for UNC and the state’s community college system to study and evaluate the North Carolina Guaranteed Admission Program (NC GAP). That program’s goal is to raise graduation rates by improving marginal students’ academic skills at community colleges before they enter a UNC school. 

“[The program works] by identifying students who satisfy UNC institutions’ official admissions criteria, but who are academically weaker than their peers. These students would be given a promise of admission to the UNC schools to which they applied…after they [complete] an associate degree at a North Carolina community college,” explained Jenna A. Robinson, president of the Pope Center, in July. 

The state subsidizes full-time university students to the tune of about $13,500 per year; for community college students, that figure is roughly $4,200. NC GAP, if implemented, would save money and resources and direct students to the schools that best match their educational needs.

Another solid budget provision requires the State Board of Education to raise minimum admissions requirements for teacher preparation programs. It requires the UNC Board of Governors to set the minimum SAT score (combined verbal and math) for students seeking entry to education schools at 1,100 and the minimum ACT score at 24. Students also must earn at least a 2.7 GPA in high school to be admitted to a program, and the average GPA of students in each program must be at least 3.0. 

The content of teacher education programs is also addressed. For instance, the budget states that elementary teacher programs must demonstrate that they have “adequate coursework in the teaching of reading, writing, and mathematics.” Also, before being licensed, would-be elementary school teachers must show that they have “the requisite knowledge in scientifically based reading, writing, and mathematics instruction.” 

These changes are consistent with recommendations made by Kate Walsh, president of the National Council for Teacher Quality (NCTQ), at a Pope Center event held last October. NCTQ has released several reports (its 2014 report was published in U.S. News & World Report) criticizing teacher preparation programs for their lack of rigor and low admissions standards. The Council has referred to the teacher preparation field as an “industry of mediocrity.” North Carolina’s new admissions criteria will help to raise the bar at education schools (although, the legislature should exert some oversight to make sure that language such as “adequate coursework” is not so vague that the education school establishment can evade real reform).

Several other items in the budget are noteworthy. For example, the system has been directed to make $60 million in management flexibility cuts over the next two years. This is a great opportunity for the system to rein in administrative excess at the state’s universities and to eliminate vacant faculty positions that are an unnecessary financial burden on the state. The budget also eliminates taxpayer support for the progressive-leaning Hunt Institute, an education reform organization at UNC-Chapel Hill that in the past has “[coordinated] with legislators to advance a political agenda.” 

In addition, the latest budget ends funding for the Academic Summer Bridge Program, which is intended to provide an academic “boot camp,” as well as remedial education resources, for weak students at the state’s historically black universities. Since 2007, the state has allotted more than $7 million to the initiative, which by all accounts has been a failure. Jesse Saffron, who analyzed the program last March, wrote at the time, “[The] state is spending millions of dollars on a program that each year drives roughly 300 low-performing students into a four-year university, where they tend to earn poor grades, drop out, or otherwise fail to graduate within a reasonable period of time.”

There are a few items in the community college system’s budget that are worth mentioning, too. First, that system’s $1.05 billion operating budget will increase by roughly $20 million in each of the next two years. Second, tuition will increase by $4 per credit hour, or $128 each year for in-state students. Third, the system’s enrollment funding formula will be adjusted to account for courses taught year-round. That will equate to about $17 million of additional funding each year. And finally, $7.5 million will be spent on new instructional equipment.

The state’s higher education budget is usually a mixed bag of “the good, the bad, and the ugly,” and this year’s is no exception. However, the legislature should be commended for addressing a number of important issues that traditionally have been neglected or overlooked.