September 10, 2015
Chairwoman Sullivan, members of the Committee, I am Hank Bounds, and I am president of the University of Nebraska. Thank you for the opportunity to talk with you today about college affordability – a topic that is very important to me personally and to our Board of Regents. I’m pleased that you are conducting this study and I look forward to working with you to make sure a college degree remains within reach for all Nebraska students and families. With a growing share of jobs in our state requiring higher education, achieving that goal is vital to Nebraska’s economic competitiveness.
I’ve been in this job for almost five months. I’ve traveled the length of the state, visited dozens of Nebraska communities and talked with countless Nebraskans – students, parents, taxpayers, alumni, farmers and ranchers, business leaders, and of course legislators. Some key themes have emerged from my conversations. The cost of college is one of them. Nebraskans rightfully want to know what we are doing to make sure our students get to the finish line in less time, with less debt, and into the workforce sooner. No doubt you hear the same questions from your constituents.
Fortunately, we have a good answer. You just have to look beyond the national headlines about “ballooning” student debt and “meteoric” rises in tuition. And our answer gets even better when you think about higher education not as a cost, but as an investment in the future – which I think is the right way to frame this discussion.
Here in Nebraska, we understand that an educated workforce is the key to a successful future. The Legislature has made affordable access to higher education a priority that has helped guide its decisions and investments. And as a result, the University of Nebraska is able to provide our students with an excellent education at a great value. I know this is not the case everywhere and I am grateful for your support. The productive partnership between the state and its public university was in fact one of the things that attracted me to this position.
The message I want to convey to you today is that our partnership has never been more important. On your end, I hope the Legislature will continue its investment in the university at a level that will allow us to ensure affordable excellence for Nebraskans. And on our end, we will be effective with the dollars you entrust to us so we keep costs down for students.
The University of Nebraska relies on two sources of revenue to support our core operations: state appropriations and tuition. These are the funds that allow us to pay our faculty and staff, maintain our facilities, and cover day-to-day costs. Historically, the two have had a “teeter-totter” relationship. When one goes down, the other is forced up. So if we want to maintain the quality that you expect of us, while also keeping tuition low, we depend on a stable investment from the state.
It’s true that the state has increased its support for the university over time. Because of that, we have been able to keep tuition increases moderate and predictable, including a freeze for resident students in the last biennium. Our current tuition and fees are at least 25 percent below our peer averages. We have the lowest debt levels in the Big Ten because our tuition is almost 50 percent below our Big Ten colleagues.
But, increases from the state have not kept pace with inflation or our enrollment growth, which we just announced has reached a 22-year high. We also find ourselves in a troubling trend over the last few decades of receiving a shrinking slice of the state’s total budget. And even as the purchasing power of state dollars has declined, our needs are more pressing than ever. We are operating in the most competitive higher education marketplace in our lifetimes. The competition for bright students, talented faculty and staff, and coveted research dollars has never been more intense. You have probably heard me say that I want the University of Nebraska to be a giant in higher education. If we want to be that giant, we will need to make investments – in people, in our facilities, and in other areas that advance our strategic priorities.
Students and families should not bear those costs alone. They have done their part and will continue to do so. But the state also has a stake in the success of its public university – responsible for sending 10,000 graduates into the workforce annually, conducting research that improves the quality of life for Nebraskans and people around the world, and engaging with citizens in all 93 counties.
The University of Nebraska has a responsibility as well to make sure every Nebraskan has the opportunity to pursue a college education. And we take that responsibility seriously – which is why the strategic priorities of the Board begin with affordability. I am proud of our record in this regard. Let me highlight a few things we have done.
First, our sticker price is just that. A sticker price. Today we commit more dollars from our operating budget to need-based financial aid than ever. More than half of all University of Nebraska undergraduates receive grant aid that they do not have to pay back. That includes 7,000 low-income Nebraska students who pay no tuition through the Collegebound Nebraska promise, a number that has grown steadily. We have also leveraged partnerships with private organizations such as the Susan T. Buffett Foundation to help more underrepresented students afford college. The Nebraska Opportunity Grant Program is another initiative that has provided valuable support to low-income students and I thank you for your investment in it. Even so, Nebraska still ranks low in the per-capita amount of need-based financial aid that is available to students.
We are also working to reduce time to degree – an important strategy in lowering costs for our students. A fifth year of college can add 20 percent to the cost of a degree. Several years ago the Board approved a new policy standardizing a bachelor’s degree at 120 credit hours, so most students who take a full course load every semester have the opportunity to graduate in four years. And we are implementing strategies on the campuses to improve our retention and graduation rates, like learning communities that allow students in the same academic programs to live and study together, and early intervention programs for at-risk students. New collaborative efforts between the university and our partners at the state and community colleges to support students who want to transfer are also helping them stay on the path to their degree.
Finally, cost effectiveness is an important part of this equation. We have repurposed more than $80 million from our budget since 2000, with more on the way. This is never an easy process. But – just as you face difficult decisions in allocating the state’s valuable resources, and just as every Nebraska family must make tough choices in balancing their budgets – we have had to be efficient and strategic with our resources, choosing where to invest in order to best serve Nebraskans. To put this into perspective, if we had not repurposed the $80 million, we would have had to increase tuition by 25 percent.
Members of the Committee, thank you again for exploring this important topic. I agree we need to be talking about college costs. But it is equally important to talk about the value of that investment – the investment a student makes in his or her future, the investment the state makes in individuals who will become contributing members of society. The returns, in terms of a $1 million lifetime earnings difference, not to mention the personal growth and discovery and the many societal benefits that come with higher education, are enormous. I have devoted my career to helping students transform their lives through education and my goal as president of the University of Nebraska is to make sure every student in our state can do the same.
Thank you, and with that, I’d be happy to take your questions.