As student debts mount, universities see little good news in state budget figures

Danielle Horton, 21, will be graduating in May from Michigan State University with a degree in social work and a debt that worries her.

“I will be approximately $60,000 in debt,” says the mother of two young children. “It’s discouraging. I pray I make enough money to afford tuition for my children so they will not have to depend on financial aid like I do.”

While tuition more than doubled over the past decade at Michigan universities, policy-makers cut need-based grants by 20 percent, invested the least in grant dollars per student in the Midwest, offered grants to only 14 percent of students and gave a large share of need-based grants to students from higher-income families attending private colleges, according to a Michigan League for Public Policy report -- Keeping it Affordable in Michigan: Disinvestment in Financial Aid Grants Hurts Students and Their Families.

Lower state support for Michigan universities, coupled with diminished need-based grants, is a double-whammy for Michigan college students and their parents, leading to crippling student loan debt and questions about whether Michigan is as committed to higher education as many other states.

In his 2014 budget plan, Gov. Rick Snyder called for $1.43 billion in state aid to Michigan’s universities, most of it from the state’s general fund and an increase of 2.2 percent from the current year.

However, Donald Heller, dean of the College of Education at Michigan State University, at MSU, says the 2 percent increase “is certainly not enough.

“We in higher education would like to see more, but we recognize the governor is trying to be conservative given the shaky state of the economy and other pressing needs,” said Heller. “I don’t expect higher education funding to recover after this most recent recession as it had in most other states in past recessions, and I’m afraid that this proposed increase is emblematic of that concern.”

Snyder’s budget does call for a $3.2 million increase in the state’s “Tuition Incentive Program” for low-income students, which now aids about 15,000 students – most of them at community colleges. Most of the state’s other tuition programs are recommended for continuation funding under the governor’s plan.

Last year, a Bridge Magazine analysis on higher education compared the cost of attending Michigan public universities to public universities in other states. The results were clear. Michigan gives less money to its public universities and students are paying more money to attend state universities than students in almost every other state. In just four years, there was a 49 percent increase in student loans at Michigan’s 15 public universities, according to the analysis.

The study showed that 12 of Michigan’s 15 public universities had net student costs higher than the median of their peer institutions across the country. Michigan State with a net cost of $14,708 and the University of Michigan, Ann Arbor with $16,888 in 2008-09 had the 6th and 15th highest net cost out of 73 schools in their peer group across the nation.

For some students, these numbers are less than promising. MSU student Elicia Benjamin, a 21-year-old California native, has accumulated a mountain of debt over the years from her decision to attend school in Michigan. In May, the political science/pre-law major will have $176,000 in college debt because she is an out-of-state student.

With costs increasing, financial aid decreasing and state appropriations only reaching a 2 percent climb, Benjamin says it’s becoming difficult.

“Increasing tuition and decreasing financial aid is limiting the accessibility to a good education. It is becoming unaffordable with no assistance,” says Benjamin. “I think that every state should invest more in higher education. Empowering individuals and providing greater accessibility to higher education so that our generation and future generations can have the ability to have a bright future is worth investing in.”

For in-state freshmen this year, a full year’s tuition and fees can range from $8,120 at Saginaw Valley State University to $13,353 at Michigan Tech in Houghton. (See table at right.)

Mike Boulus, executive director of the President Council State Universities of Michigan, the universities’ advocacy arm, says change is in order.

“I think policy-makers view universities as having an alternative source of revenue called tuition. So they feel like they can cut us more than maybe some other item in the budget,” says Boulus. “We cannot sustain the model we’ve been on over the last decade which is cut, cut, cut, cut. It’s an unsustainable model. I think we will be able to moderate tuition dramatically if we were able to get a more significant investment from the state.”

Boulus says a more significant investment would be a “100 million dollars a year.

“We can’t get it all back in one swoop but 100 million dollars a year for the next 10 years is really what we’re asking. 100 million dollars would restore what we lost over the last decade,” says Boulus. “I think tuition would slow down. No question about it. I think affordability and access is the key to this whole issue.”

Despite the debt, Benjamin says she wouldn’t change her decision:

“I have thought about the additional debt I am going to accumulate attending law school. But, in the end it is all worth it. No one can take away your education or the experience and lessons you learn in college.”

Taylor Trammell is the 2012-13 Center for Michigan journalism student fellow. She is pursuing a journalism degree at Wayne State University.