Kentucky’s Disinvestment in Higher Education Part of a Harmful National Trend

By Jason Bailey
March 19, 2013

New Report: “Recent Deep State Higher Education Cuts May Harm Students and the Economy for Years to Come”

Kentucky’s Disinvestment in Higher Education Part of a Harmful National Trend

Report describes states’ failure to invest in public universities and colleges

Kentucky has cut investment in public universities and colleges in recent years, driving up tuition and threatening educational quality while making it harder for the state to build an economy that relies on a well-educated workforce. Those cuts are part of a nationwide trend, according to a new report from the Center on Budget and Policy Priorities.

Kentucky cut funding for higher education by 26 percent since 2008 when adjusted for inflation, a decrease of $2,663 per student, according to the report. Nationwide, states cut higher education spending by 28 percent or $2,353 per student.

The immediate consequences of these cuts in Kentucky are clear: the average tuition at a public, four-year college in Kentucky has increased by 22 percent or $1,549 since the start of the recession.

“Everybody knows that a strong economy is built first and foremost on a well-educated workforce,” said Jason Bailey, director of the Kentucky Center for Economic Policy. “Yet, Kentucky has chosen to cut investment in this area, which makes it harder for many people to afford college. This is not the way to build a prosperous state.”

When the recession hit in 2008 and tax revenue dropped, most states relied heavily on spending cuts rather than a more balanced mixed of spending cuts and revenue increases. As a result, many states slashed funding for public colleges and universities.

As a result, tuition at four-year public colleges has grown nationally by 27 percent since the 2007-08 school year. The price of attending a public college or university has grown significantly faster than the growth in median income in the U.S. over the last twenty years.

Public colleges and universities also have cut faculty positions, eliminated course offerings, closed campuses, shut down computer labs, and reduced library services.

Last year the University of Kentucky laid off around 140 people and eliminated another more than 160 vacant positions. The University of Louisville recently announced that it plans to introduce an early retirement program to senior employees to free up university funds.

To reverse these trends, Kentucky needs to make higher education a priority. A large and growing share of jobs will require college-educated workers, and the only way to make sure Kentucky students are prepared is to keep higher education affordable.

“More jobs in the future will require college-educated workers,” said Phil Oliff, policy analyst at the Center on Budget and Policy Priorities and author of the report released today. “For the sake of its economy and future workforce, Kentucky should start reinvesting in its colleges and universities now.”

In order to make sure Kentucky has enough money to make this critical investment, lawmakers must make tax reform a priority. Despite the recommendations of the Governor’s Blue Ribbon Commission on Tax Reform to raise new revenue, tax reform was not taken up during the legislative session that is currently wrapping up.

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The Center’s full report can be found at: http://www.cbpp.org/cms/index.cfm?fa=view&id=3927.

The Kentucky Center for Economic Policy is a non-profit, non-partisan initiative that conducts research, analysis and education on important policy issues facing the Commonwealth. Launched in 2011, the Center is a project of the Mountain Association for Community Economic Development (MACED).