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Opinion: Michigan’s surprising leadership on college affordability

Sridhar Kota

In this summer’s debates and stump speeches, Michigan gubernatorial candidates from both parties have emphasized a common theme: College is too expensive. While the Democratic contenders have put forward policy proposals for free four-year college, Republicans have also emphasized the problem of runaway tuition costs. There’s a real need to focus on the challenge.

Less than one-third of Michigan adults have a bachelor’s degree, and our state’s graduates have the 11th highest debt levels in the nation with average tuition costs rising faster than inflation. While college isn’t the only path to a meaningful middle-class career, unaffordable options threaten our state’s economy. If graduates are loaded with debt, they can’t buy homes, start families, or even stay in Michigan.

Kota writes: "This year, U-M began offering in-state students with a family income of $65,000 or less free tuition for four years."

One solution to the challenge of college affordability is emerging from an unlikely place: the most “expensive” and “exclusive” institution of higher education in our state. In spite of its often-elitist reputation, the University of Michigan-Ann Arbor has recently made a deliberate decision to prioritize reducing or even eliminating tuition for students coming from moderate and low-income families. Other universities should follow Ann Arbor’s lead.

While UM is sometimes derided for charging a whopping $48,000 for full-price out-of-state tuition (comparable to elite private universities like Harvard and Stanford), undergraduate tuition for in-state students hovers around $15,000, comparable to other leading public schools.

Of course, this is still a heavy burden, factoring in the costs of room and board, for most families. But the university is taking unprecedented steps to lighten the load. This year, UM began offering in-state students with a family income of $65,000 or less free tuition for four years. This "Go Blue Guarantee” of four-year full tuition plus qualified additional aid based on need is given to 1,700 students currently enrolled and it applies to half of the families in Michigan.

Further, the university's need-based financial aid program now typically covers significant expenses for students coming from Michigan families earning up to about $125,000 a year and sometimes even more. UM is making this possible by allocating an unusually high portion of its fundraising capacity to student financial aid including a large number of endowed scholarships. With administrators facing many competing priorities, from facilities upgrades to endowment additions, it takes real commitment to prioritize affordability.

It’s striking that UM has been able to do this without sacrificing quality. The university is still consistently ranked in the top ten nationally according to a broad range of indicators. While most universities lack the resources available to UM, it’s nonetheless possible for universities across the state and the nation to prioritize affordability and promote such income-based plans. But, of course, it’s not entirely up to universities themselves.

The decline in public financing for public universities makes affordability doubly difficult these days. While state appropriations accounted for about 70 percent of public higher education revenues in 1979, the figure dropped to 23 percent by 2016. Universities are therefore often forced to make the difficult decision to increase tuition, sometimes at rates that exceed inflation.

The state of Michigan has been a particularly egregious offender – it lags many other states in both operating appropriations and direct aid to students. Other top public universities, like the University of Virginia, receive upwards of 10 times what UM receives for student grants and scholarships from their state governments.

Since state appropriations now account for only 15 percent of UM’s general revenues, the university could very easily transform into a private institution — attracting top out-of-state students who can pay full tuition for a world-class education. While such a move might be feasible for the university, UM is thankfully committed to remaining a public institution in order to retain its public mission in service to our state.

Over the course of my 30 years on the University of Michigan faculty, there have been moments when I wondered, as our state and nation grapple with challenges of economic inequality and runaway educational costs, how families could afford my institution with its hefty price tag. But, with Michigan’s commitment to 100 percent free tuition for students from moderate and low income families, it’s clear that UM is taking a stand to do what’s right.

With more appropriate levels of funding from the state legislature, colleges and universities around the state could do more to support the public interest and reduce the cost of tuition. For the sake of our state’s future, elected officials should commit to college affordability.

Sridhar Kota is the Herrick Professor of Engineering at the University of Michigan and executive director of MForesight: Alliance for Manufacturing Foresight.