This article originally appeared in Bridge Michigan March 26, 2021.
Michigan taxpayers are set to invest around $1.5 billion in the state’s public universities this year. However, the amount of support varies widely. For instance, students at Oakland University receive $3,100 in state funding each, while those at Wayne State get $8,900. This disparity raises an important question: Are we getting our money’s worth?
Consider Grand Valley State University. It gets only $3,300 per student but offers a great return on investment. It has a high graduation rate and tuition lower than the state average. On the flip side, Central Michigan University has similar graduation rates and even lowered tuition this year. Yet, it still receives less funding than many peers.
Right now, just half of the budget increases are linked to performance metrics, which isn’t enough motivation for universities to improve. States like Arkansas have implemented more stringent metrics for funding, and Michigan could benefit from doing so as well. If state lawmakers want to make taxpayer dollars count, they need to rethink how university funding is handled.
Here are four key areas that should influence state support:
1. Tuition and Student Debt. College costs are rising, and student debt is a big concern. Schools should be encouraged to keep tuition reasonable. Instead of simply capping tuition hikes, funding could be tied more directly to how well universities manage costs and student debt levels.
2. Graduation Rates. Alarmingly, over 40% of students in Michigan’s public universities don’t graduate. This leads to wasted time and money. While it’s unrealistic to expect a perfect graduation rate, the current figures are troubling. Schools need to focus on supporting the students they admit. Increased funding for improved graduation rates could motivate better outcomes.
3. Job Placement. Not all degrees open doors to good jobs. In fact, over one-third of college graduates are in positions not requiring a degree. Tracking post-graduation employment and earnings can help schools align their programs with job market needs. This partnership could lead to more successful career pathways for students, making the college experience worthwhile.
4. Success for Low-Income Students. Graduation rates for low-income students are shockingly low. Nationally, only 15% graduate from the lowest income quartile. This is unacceptable. Universities should support these students in finishing their degrees and tie funding to their success rates. By focusing on these outcomes, schools can better serve some of the most vulnerable populations.
While diversity in the higher education system is important, lawmakers must ensure responsible spending of taxpayer money. By making funding dependent on essential performance metrics, Michigan can better meet the expectations of its residents and improve the overall quality of public higher education.
In the ongoing debate about university funding, a shift toward performance-based metrics could pave the way for improved educational outcomes and a more effective use of taxpayer dollars.
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