College Times

Issue date: 12/4/08 Section: News

Media Credit: Gary Reyes- San Jose Mercury News

Shrinking endowments, state funding reductions and families struggling to pay tuition are forcing many colleges and universities to cut staff and spending.

From well-heeled Ivy League schools such as Harvard and Dartmouth to large public institutions such as the California State University system, many schools are facing difficult financial decisions stemming from the nation's economic standstill.

Last week, the California State University system announced plans to trim 10,000 students across its 23 campuses in the next school year because of funding problems caused by a state budget crisis. The CSU system - the nation's largest - will make the cuts by moving up application deadlines and raising academic standards for incoming freshmen.

"We have been, for the last two years, over-enrolled by over 10,000 students that the legislature has not funded," CSU Chancellor Charles B. Reed said. "We can't continue to admit more and more students without receiving adequate funding."

Dartmouth College recently announced a hiring freeze and plans to cut its budget by

10 percent, or about $40 million over the next two years, because of the situation.

In previous economic downturns, college enrollment remained steady as more people bolstered their education to help improve their work prospects. However, the unique aspects of the current slide -have made a college education harder to finance and much more difficult to obtain.

Neil Theobald, the vice president and chief financial officer at Indiana University, said recently that his staff was seeing more affluent families struggling with tuition payments.

"Based on the applications, these are families that look like they can afford college, but with the economic conditions, I think they have investments that have gone poorly over the last several months," Theobald said.

Families who would have considered an expensive Ivy League education now may opt for less-expensive private schools. Others may choose even cheaper public colleges.

An October survey of more than 2,500 prospective college students by MeritAid.com, a college search website, found that 57 percent were considering less prestigious schools because of cost. Many students are cutting costs even further by attending community colleges for two years before transferring to four-year institutions.

Enrollment at Oklahoma regional universities fell by 1.5 percent this semester, while the state's community college enrollment jumped by an almost identical amount, according to the Oklahoma State Regents for Higher Education.

Community colleges, however, are facing their own economic problems. State budget cuts and declines in funding from local property-tax revenue have forced many of them to scale back popular programs, particularly vocational/technical courses that are more costly to offer.

"Unfortunately, the most expensive programs that correlate to the highest-wage jobs are the ones that are most at risk," said Stephen Katsinas, the director of the Education Policy Center at the University of Alabama. In a recent survey of community college officials in 49 states, Katsinas found that nearly half expect their states to impose midyear cuts in higher education appropriations.

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