Universities eye out-of-state budget help

Faced with tight budgets and prospective dwindling in-state enrollment, public universities across Michigan are looking beyond the state line for answers.

One option, say advocates such as Domino's Pizza CEO Patrick Doyle and University of Michigan President Mary Sue Coleman, is to boost recruitment of out-of-state students – students who pay much higher tuition rates than the Michigan natives sitting next to them in class.

"As a state, if you look at all 15 universities, we are underperforming in terms of our out-of-state student population," Coleman said in May at the Mackinac Policy Conference. "That is, we have capacity, and these students come paying the full freight. They actually add tremendously to the economy in the state of Michigan."

For months, Business Leaders for Michigan -- a nonprofit advocacy group of business executives and education officials aimed at strategies to grow the state economy – has argued for an "out-of-state" recruitment strategy. It estimates that raising Michigan’s out-of-state enrollment to that of comparable universities outside the state could net $200 million in increased tuition over four years.

That’s a huge deal for university administrators and parents alike. State investment in university operations has dropped significantly in the last decade. For fiscal 2001, the state appropriated about $1.9 billion in state funds.

Had that level been maintained for 2012, the state investment would be $2.46 billion, adjusting for inflation. Instead, state funds for the 2012-13 budget are just over $1.3 billion.

But out-of-state students have value beyond their wallets, BLM argues. They serve a second, more vital, purpose: boosting a university talent pool that could prove thin if current enrollment patterns continue.

Such ideas are attractive to a vast majority of Michigan voters, BLM has found. Via polling conducted at the end of August, BLM found that 79 percent of Michigan residents supported more recruiting of out-of-staters, as long as such additions didn't limit the number of college slots to Michigan students. Only 17 percent expressed opposition to the idea in a survey of 600 voters by The Glengariff Group.

"BLM sees our higher education system as one of the state's most important assets in growing our state’s economy," said Kelly Chesney, BLM vice president. "It’s no secret that Michigan is facing talent shortages in the future. Many of the jobs of the future will require a post-high school education -- tech training, community college or better.

"Michigan’s premier higher education institutions can be a part of the solution. With K-12 enrollment on the decline, increasing out-of-state enrollment at Michigan’s universities without adversely impacting in-state enrollment can help fill the talent pipeline," Chesney added.

The number of Michigan's high school graduates could drop from 117,750 students in 2008 to 91,870 by 2020. The 2010 Census found that the number of children under 18 in Michigan dropped by nearly 10 percent in 10 years, a decline of more than 250,000.

Analysts attribute that to falling birth rates and families that fled the state during the recession.

The tuition rate differential between in-state and out-of-stae is considerable. At U-M, 2011-12 tuition and fees were pegged at $12,634 for in-state undergraduates and $37,782 for out-of-state undergraduates. At Michigan State University, in-state freshmen were charged $406.75 per credit hour in 2011-2012 compared to $1,038.25 for out-of-state residents.

But at the same time, the enrollment profile varies widely among state universities. The University of Michigan had out-of-state enrollment of more than 30 percent in 2009-2010, according to the Integrated Postsecondary Education Data System. Michigan Technological University was second with 23.6 percent, Northern Michigan University third at 21.4 percent. All ranked above comparable peer institutions.

Several schools – including Wayne State University, Oakland University, Ferris State University, Grand Valley State University, Saginaw Valley State University, U-M Dearborn and U-M Flint -- had out-of-state enrollment of less than 5 percent. In each case, they were far below peer institution averages.

In 2010, the U.S. average out-of-state enrollment at all degree-granting schools was 19 percent. Michigan's, going to Coleman’s point above, was 9 percent.

“Michigan State University has recruited and welcomed domestic and international out-of-state students and scholars for over 100 years to enrich the diversity of our learning environment for all of our students,” said MSU Provost Kim Wilcox. “Because of MSU’s longstanding commitment to international teaching, research and outreach, we are particularly attractive to a broad range of students — and able to make those students feel like they’re a vital part of our campus community.”

The issue has a touched a nerve beyond the Great Lakes State. In California, a legislator is backing a constitutional amendment that would limit out-of-state enrollment in the University of California system to 10 percent. UC-Berkeley Chancellor Robert Birgeneau said the measure would do "irreparable harm" to Californians and hamper institutions such as UC-Berkeley, where out-of-state enrollment was 18 percent in fall of 2011.

Officials at Wayne State University (1.2 percent out-of-state for 2009) say they aren't interested in boosting nonresident numbers.

"Michigan taxpayers are providing funding to us to help the students of Michigan," Robert Kohnman, the associate vice president for budget, planning and analysis at WSU, told the Detroit Free Press.

But in North Dakota, strategies to boost enrollment by out-of-state students are judged a success. Out-of-state students comprised more than 50 percent of the 14,500 enrolled in 2011 at North Dakota State University, as well as at the University of North Dakota in Grand Forks. Nonresident students at North Dakota's 11 public colleges constitute a higher ratio than in almost every other state. With a population of about 684,000 (in 2011), North Dakota has a public campus for every 62,181 residents.

University of North Dakota Chancellor William Goetz noted that nearly 50 percent out-of-state and foreign students remain in the state after graduation.

At Grand Valley State University in West Michigan, graduate student Andrew Bradley, 25, said he believes a larger mix of students from outside the state "could foster a good, healthy competition" at GVSU.

"You would be attracting new talent. I'm all for it if it can do that."

Ted Roelofs worked for the Grand Rapids Press for 30 years, where he covered everything from politics to social services to military affairs. He has earned numerous awards, including for work in Albania during the 1999 Kosovo refugee crisis.

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Big D
Tue, 09/11/2012 - 8:43am
Hard to believe you can attract out-of-state enrollments with tuition rates like those. Unless the school has national cachet, who would want to come to Michigan? However, glad to see the effort to handle the reduction in public financial support for bloated secondary education, Would be better to see more (any) determined cost-cutting. Sure, that's a competitive issue--perhaps we have excess capacity? Every student that borrows the money to vacation at a university is deluding themselves and setting themselves up for financial hardship of their OWN making. Probably there should be guidelines about how much of your education you don't have to work for. Meanwhile, I expect we'll start to hear about "bailing out" the poor students (since we have so much public money to spare). ...and of course, if Michigan has the POOR JUDGEMENT to buy the deception of POJA, this will get worse.
Thu, 09/13/2012 - 9:07am
One of the goals of public higher education is to secure a well-educated work force for the state. What is the percentage of out of state students who remain in the state after graduation? For comparison sake, what is the percentage of in-state students who remain in the state after graduation? The citizens of Michigan pay taxes and support higher education in part with the hope that the residents of the state will secure a first rate education at a rate lower than private higher education. Higher education should focus on how to reduce its costs without compromising its delivery as industry has over the last few decades. In many ways, it seems they search for new revenue sources rather than determining the best outcomes for the students and the state. What is the mission defined by the State of Michigan for public higher education? Are they meeting those goals?
Tue, 09/11/2012 - 11:29am
When I stop reading/hearing about qualitified Michigan students that are denied admission to U of M with GPA's above 3.8, advanced classes and well rounded young adults, I will support increasing out of state student percentages at Michigan universities. Until then, Michigan universities need to remember that Michgan tax payers support their budgets and focus on educating our best and brightest so they stay in Michigan and not drain Michigan's talent pool. If Michigan universities need more money to support their budget, then they need to look for efficiencies/opportunities to that end - just like every other business in Michigan has had to do. The fact that they spend without restraint is not a reason to look to out of state students for increased revenue.
Tue, 09/11/2012 - 1:38pm
The trick is to get the graduates to move here for jobs after having the taxpayers from anothr state pay to educate them! Hanging our hat on our universities and most students to do something smart is a fools erand.
Nick Ciaramitaro
Tue, 09/11/2012 - 2:26pm
So we leave Michigan students behind in search of the dollar ignoring the need to do what state government is charged with doing -- preparing the next generation for the needs of tomorrow. So sad.
Wed, 09/12/2012 - 11:05am
No the sad thing is the big percentage of the kids we the tax payers just invested a pile of money into end up leaving the state! I'll bet it's even worse if we look at engineering, technocal and science majors! While we keep those who's ed background gives little prospect of even paying back their student loans. At our current place, our higher ed system is a swamp.
Richard Cole
Sun, 09/16/2012 - 2:00pm
The strategy of continuing to work hard to attract out-of-state students -- especially to those universities that have historically been underrepresented in this category -- makes best sense if we work equally hard to find internships and job opportunities for those out-of-staters we recruit here. And insofar as we are recruiting large numbers of international students, we should all advocate for Thomas Friedman's recommendation that America should start stapling green cards to the diplomas of our immigrant students.
Mon, 09/17/2012 - 9:35am
UofM already has 30% non residents? Other nationally acclaimed public universities are much less: UC Berkley - 2% UCLA1% North Carolina 5% U of Virginia 3% U of Texas, Austin - 5% What are we thinking in this state? Any non-resident is not coming here for future opportunity. Lets think about fixing the economy and fostering an environment that allows corporations to expand or move here....not focus on some temporary students.