Trends in Higher Education Funding, Enrollment, and ...

JOINT LEGISLATIVE AUDIT AND REVIEW COMMISSION

REPORT TO THE GOVERNOR AND THE GENERAL ASSEMBLY OF VIRGINIA

Trends in Higher Education Funding, Enrollment, and Student Costs

HOUSE DOCUMENT NO. 8 COMMONWEALTH OF VIRGINIA RICHMOND

JUNE 2013

Members of the Joint Legislative Audit and Review Commission

Chair Delegate John M. O'Bannon III Vice-Chair Senator John C. Watkins

Delegate David B. Albo Senator Charles J. Colgan Delegate M. Kirkland Cox Senator Janet D. Howell Delegate Johnny S. Joannou Delegate S. Chris Jones Delegate James P. Massie III Senator Thomas K. Norment, Jr. Delegate Robert D. Orrock, Sr. Delegate Lacey E. Putney Delegate Lionell Spruill, Sr. Senator Walter A. Stosch Martha S. Mavredes, Auditor of Public Accounts

Director Glen S. Tittermary

JLARC Staff for This Report Justin Brown, Project Leader Drew Dickinson Laura Parker Greg Rest

Report No. 441 This report is available on the JLARC website at Copyright 2013, Commonwealth of Virginia

July 19, 2013

The Honorable John M. O'Bannon III Chair Joint Legislative Audit and Review Commission General Assembly Building Richmond, Virginia 23219

Dear Delegate O'Bannon:

House Joint Resolution 108 (2012) directed the Joint Legislative Audit and Review Commission (JLARC) to study the cost efficiency of the Commonwealth's institutions of higher education and to identify opportunities to reduce the cost of public higher education in Virginia. This is the first report in a series of reports under HJR 108 that will be released during 2013 and 2014. This report includes context that will be relevant to topics addressed in the subsequent JLARC reports on key topics, such as faculty activities and non-academic student fees and costs.

The final report was briefed to the Commission and authorized for printing on June 10, 2013. On behalf of the Commission staff, I would like to thank the Secretary of Education and the State Council of Higher Education for Virginia for their assistance during this review. I would also like to acknowledge the staff at Virginia's 15 public higher education institutions, who have been very accommodating to our research teams.

Sincerely,

GST/ehs

Glen S. Tittermary Director

Table of Contents

JLARC Report Summary

i

1

Virginia's 15 Public Four-Year Higher Education Institutions Vary Widely and Have Substantial

1

Autonomy

Virginia Has 15 Public Higher Education Institutions

2

With Varying Degree Offerings, Student Populations,

Selectivity, and Prices

Virginia Has a Decentralized System in Which Most

5

Authority for Higher Education Resides With Boards

of Visitors

Higher Education Restructuring Act of 2005 Further

10

Expanded Institutional Autonomy

JLARC Series on Higher Education

12

2

Most Spending Is Not on Instruction; Auxiliary Enterprises Drive Spending Increases

13

Spending and Staffing for Activities Other Than Direct 13 Instruction Has Averaged About Two-Thirds of Total

Spending on Auxiliary Enterprises Has Been Largest 16 Contributor to Spending Increases at Virginia Institutions

3

States Have Shifted More of the Financial Burden of Higher Education to Students

19

Virginia Provides a Declining Portion of Total

19

Revenue and Less Than National Average

Students at Virginia Institutions Provide a Larger

24

Percentage of Revenue Through Tuition and Fees

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