Higher Education Funding

Higher education across the country continues to struggle with state funding cuts, aging facilities, increasing tuition rates and a rapidly increasing student population. An annual survey of community college directors conducted by the Education Policy Center shows  educators are worried if these trends continue, higher education may be out of reach for many Americans.

  Download the PDF Version of the Brief

  Download the Excel Version of the Table:  "Tuition and Funding Changes"

During the 2009-10 academic year, the financial outlook for higher education in the states did not improve signifcantly. In some cases, it worsened.

  • Slightly fewer community colleges (56 percent) reported midyear budget cuts compared to 2008-09 (71 percent), according to a survey of community college directors by the Education Policy Center at the University of Alabama.
  • Community colleges reporting midyear budget cuts in 2009-10 made deeper cuts than the previous year, 8 percent vs. 6 percent.
  • Almost all of the state directors surveyed reported tuition increases in every sector of higher education, averaging from 4 percent for historically black colleges and universities to more than 6 percent for flagship universities.
  • Almost all community college directors agreed the recession was the top-ranked state budget driver.1

A rapid increase in the number of 18-year-olds and unemployed adults returning to college for retraining, combined with deep budget cuts, has some fearing access to higher education is becoming harder.

  • Eleven states reported capping enrollment at flagship universities, including four of the nation’s largest university systems—California, New York, Florida and Illinois.
  • Only California has capped the number of students on the community college level, which accounts for more than one in four of all community college students enrolled in the country.2 Estimates are that 140,000 students didn’t enroll in California’s community colleges last year because they couldn’t get into classes.3
  • In 2009, President Obama issued a call to improve America’s prosperity by graduating 5 million more people from community colleges by 2020.4
  • More than 70 percent of the community college directors surveyed said President Obama’s goal cannot be realized without expanding community college capacity. Sixty percent of respondents said increasing the graduation rate is “unlikely with budget cuts.”5

Higher education leaders expressed concern that the budget issues will not get better soon and it may become even more difficult for students to attend.

  • Tuition is expected to rise at five times the rate of inflation for all higher education sectors. Community college leaders in some states expect increases by as much as 18 percent.
  • The vast majority of respondents predicted states will either keep funding for student aid flat or cut it for the 2010-11 fiscal year.
  • By a 2-to-1 margin, community college directors said their state has no plan for funding once the American Recovery and Reinvestment Act money is gone next fiscal year.
  • Almost all directors reported the lack of state revenue “will be a major budget challenge” for the 2010-11 fiscal year.6


1 The Education Policy Center. “Uncertain Recovery: Access and Funding Issues in Public Higher Education.”
2 Ibid.
3 Carla Rivera. “Community college class wait lists throw a wrench into students’ plans.” Los Angeles Times. October 4, 2010. 
4 The White House. “Investing in Education: The American Graduation Initiative.”
5 The Education Policy Center.
6 Ibid.