School & District Management

Arizona ‘Changing Directions’ For State University System

By Sean Cavanagh — January 15, 2003 9 min read
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It reads like the same sorrowful script from a host of states these days: public universities scraping for cash, legislators warning they won’t be providing much more of it, and thousands of high school seniors facing the prospect of sharp tuition hikes to help cover the fiscal gap.

It is Arizona’s story, too—but it’s about to take a major turn.

Trying to break from the spiral of financial woe, the state board of regents is considering big changes in admissions and financial aid at its three public universities, while vowing to make college more affordable for poor students, too. Under a still-evolving plan known as “Changing Directions,” those institutions—the University of Arizona, Arizona State University, and Northern Arizona University—would have more freedom to set their own tuition and admissions standards, as they overhaul their academic missions, partly in an effort to save money.

Backers of the plan say it offers the booming state a long-range blueprint for protecting its universities from budget cuts, without pricing Arizona’s poor and working-class high school graduates out of college.

And some higher education officials predict Changing Directions could emerge as a model for other cash-starved university systems around the country.

“You are going to see bits and pieces of this in virtually every state,” said Travis Reindle, the director of state policy analysis for the National Association of State and Land Grant Colleges and Universities in Washington. “You’re seeing some states planning from a short-term, strategic point of view. But Arizona is looking more long term, beyond this recession.”

It is not easy. Arizona is expected to begin fiscal 2004 with a $1 billion deficit, out of a total budget of $6.2 billion for the current year. And like many other Western states, it is coping with breakneck growth, particularly among its Hispanic population. With 5.1 million residents today, Arizona was the second-fastest growing state in the nation over the past decade, when its number of Latino residents rose 88 percent. Enrollment at its public universities is expected to climb by 65 percent over the next 10 years, a rate faster than in California or Texas.

Yet Latinos in the state continue to lag behind both non-Hispanic whites and blacks in finishing high school and reaching college. Only 59 percent of Latinos who began high school in 1996 had graduated four years later, compared with 79 percent of whites and 68 percent of African-Americans, according to a state report released in 2002. Latinos will make up a sizable chunk of Arizona’s future workforce, many school and business leaders note, and the state’s economic health will hinge in significant part on their academic success.

Against this backdrop, Arizona’s new strategy for higher education is far-reaching. So far, the probable steps include:

  • Raising tuition at the three state universities from the current $2,500 per year by an additional $500 to $1,000;
  • Devoting a portion of the new revenue—the regents have not settled on how much—to “need based” financial aid for low-income students;
  • Giving the three universities more freedom to set their own tuition levels and admissions plans; and
  • Encouraging the three schools to develop separate missions, dropping some academic programs and building others.

Arizona’s struggles could be almost any state’s quandary. Across the country, states have leveled funding at their universities, forcing schools to scramble for new sources of revenue. The fund-raising tool of choice for many universities has been to increase tuition, a step that can force poor and even middle-income students into greater debt, if they want four-year degrees.

In Florida and Texas, for instance, pressure has grown to allow public universities to set their own tuition, as legislators warn that state funding is in short supply.

No Bargain for Some

For needy and middle-class students in Arizona today, a college education looks like a bargain—at least on paper.

The yearly tuition of $2,500 at public universities is one of the cheapest in the nation. But that low price is offset by the absence of almost any financial aid from the state, or its universities, to poor families, who can find themselves overwhelmed by tuition, fees, and other expenses. Arizona’s state schools graded a D-minus in affordability on a 2002 evaluation conducted by the National Center for Public Policy and Higher Education, a San Jose, Calif., research organization.

The Changing Directions plan aims to level that imbalance. Tuition would be increased by as much as 40 percent, to $3,500 a year, giving the schools more money. But the university system would simultaneously devise a program of pouring some of that money back into need- based aid for poor students.

To this point, “the low tuition has not equaled affordability and accessibility for financially stressed students and families,” said Jack Jewett, president of the Arizona Board of Regents.

“We’re very aware of the access problem for our Latino population,” added John D. Haeger, the president of Northern Arizona University in Flagstaff. “If [falling minority enrollment] were to happen because of Changing Directions, we would have failed.”

At schools like Carl Hayden High School in Phoenix, every dollar of financial aid counts. Raising tuition by $500 to $1,000 a year would amount to a huge increase for many of the juniors and seniors at the school contemplating attending college, said George M. Ferra, a counselor there. Most of the school’s students—almost 90 percent—are Hispanic, and a high percentage of them qualify for free or reduced-price lunches. Only about 15 percent of Hayden High’s graduates go on to four-year institutions, he said. Among those students, Arizona State, in nearby Tempe, is the top choice.

“Certainly it’s unpopular,” Mr. Ferra said of the possibility Aof higher tuition. “It’s tough enough to get [students at the school] to go to college at all. I’ve been to schools where 80 percent of the students go. It’s a much different situation here.”

Few of the measures outlined in Changing Directions have taken shape without an eye on the budget books. University officials say that while legislative funding has increased on paper, overall support for the campuses has declined over the last few decades, as a percentage of the overall state budget. Recent state cuts, driven partly by Arizona’s economic woes, have squeezed the schools even more.

Specializing Delivery

Changing Directions calls for the schools to develop more independently, with with greater specialization. Arizona State, with capacity to grow, would continue as a large, urban campus accessible to undergraduates; its president has suggested publicly it could become the largest university in the country. The University of Arizona, with more limited space, would grow less quickly, serving undergraduates but also trying to become more specialized in its graduate research. Northern Arizona University would serve undergraduates, but also grow as a doctoral-research university, with strengths in research and science.

“The rest of the world realizes that things have changed, and they need to be accountable to that change,” said state Rep. Laura Knaperek, the outgoing chairwoman of the House appropriations committee, who is leaving office this year. To this point, she says, “universities haven’t done that yet.” The Republican lawmaker amplifies what has become a common adage among both statehouse and university leaders: “We live in a day and age where every campus cannot be everything to everyone.”

Specialization within university systems is nothing new, of course. California’s “master plan” for higher education, adopted in 1960, offered a prototype for many states. That model allowed campuses in Berkeley, Los Angeles, and other locales to evolve into top-flight research institutions, with highly selective admissions, while directing schools in the California State University system to focus primarily on undergraduate education. Similar divisions of duty have emerged in university systems in states such as Michigan and Minnesota.

Gaping holes in budgets are certain to prompt new pushes for cutting programs in other states, and making campuses more specialized, higher education officials say.

In Tucson, Tempe, and Flagstaff, protecting the needs of lower-income students amid the pending changes has been a recurrent theme. Today, Arizona undergraduates at public universities borrow an average of about $3,573 annually, $600 more than those in states with the most affordable public campuses, according to the National Center for Public Policy and Higher Education’s report.

As they grow more expensive, Arizona’s schools are considering ratcheting up their admissions standards as well. Currently, in-state applicants in the top quarter of their high school classes who scored at least a 22 on the ACT or a 1040 on the SAT are generally guaranteed admission to any of the three campuses. But campus leaders suggest they need to become more selective, if they are to compete with other top-flight universities around the nation.

Raising admissions standards, some of them have argued, will also encourage more high school students to seriously consider if they are in fact ready for a four-year college, or should start out at a two-year college first.

Some observers worry, though, that as prices and admissions criteria rise, the universities won’t back up their goals of helping the neediest students. Minority students could be the ones to suffer, they say.

“If they raise tuition and don’t provide aid, clearly the people from the most economically disadvantaged backgrounds are going to be affected,” said Alfredo G. de los Santos Jr., a research professor at the Hispanic Research Center at Arizona State University. “How much money would be set aside, and how would it be structured?”

The risk in Arizona’s approach is the possibility of cutting off access to four-year institutions as demand soars with the state’s population, said Joni Finney, the vice president of the National Center for Public Policy and Higher Education.

“The question will be, ‘Where will everybody else get to go?’” Ms. Finney said. “How are you going to provide opportunity in Arizona for everybody [who is] prepared for it? ... I would be really worried about narrowing opportunity.”

Arizona would be better off having the state, rather than its universities, oversee the need-based aid system, Ms. Finney argued. State control fosters public scrutiny, she said. And universities controlling those purses have shown a tendency to shift too much money into merit-based aid, Ms. Finney added, which traditionally has benefited middle-class students more.

To protect low-income students, the financial aid promised in Changing Directions has to be ironclad, shielded from future swings of the state’s budget-cutting ax, said David A. Longanecker, the executive director of the Western Interstate Commission for Higher Education. The Boulder, Colo., research organization works with colleges and universities in the West, and has been consulting Arizona’s regents on Changing Directions.

“That has to be a lock and absolute quid pro quo,” Mr. Longanecker said. “In the states that have the strongest need-based programs, [needy students] have been protected.”


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