The U Must Better React to Today's Society
Lyle Wray, Executive Director, Citizens League

The Citizens League has had a long interest in the structure and quality of Minnesota's system of post-secondary education. Numerous citizen-based committees have grappled with higher education issues over the past 30 years. In 1971, the League urged the creation of a new kind of urban college, which resulted in the establishment of Metro State University. Since that time the League has produced seven additional reports dealing with various elements of higher education.

The state s general fund support for higher education has declined as a percentage of general fund expenditures over the past 15 years. Tuition increases have exceeded per capita income during this same period. All signs point to a continuation of strong cost pressure on Minnesota s post-secondary system over the coming decades.

Nearly 90 percent of the state funding has gone to the University and MnSCU, with only 10 percent in the form of direct student aid. The state's institutional subsidies that "write down" tuition across-the-board disproportionately favors students who are relatively well-off, while fewer and fewer low-income and minority students can afford college. With a slower growth in the labor force, this is the time to rethink support for individuals versus institutions. More funding for existing workers might be better accommodated through direct funding or tax-advantaged savings plans for working adults.

In addition, there is a mismatch in the location of institutions and the location of students. Fifty-three of the state's 66 public institutions, or 80 percent, are outside the metropolitan area while more than half of likely students are in the metro.

The most recent League report on the University concluded that, in the emerging knowledge economy, the premium on a well-educated, high-skilled workforce is greater than ever before. The state, and its residents, needs a well-coordinated higher education system that responds to today's conditions.

Research universities are vital in the economic health of regions and states. The University of Minnesota is an important asset for our region's competitiveness. While the University remains generally well regarded, its reputation in some advanced degree programs has declined. The University must establish clear priorities to improve graduate and professional education and research programs and commit the necessary resources to support those priorities.

Below is an outline of the principles that the Citizens League believes must guide state decisions about higher education and especially the University of Minnesota:

Systemic change for higher education

• Target subsidies directly to people who have financial need. That means reducing the share of support provided via appropriations to institutions, and increase the share provided directly to needy students. View students as competitors for public funding, and discontinue public tuition write-downs if performance is unsatisfactory.
• Make institutional appropriations for instruction, research, and other activities contingent on performance and consider long-term economic growth to be one of the objectives of state spending.
• Allow prices to reflect instructional costs and offset the possible increases through increased state grants and lifetime learning grants appropriated to students.
• Create incentives that encourage people to save for college and for continuing education.
• Allow "chartered" higher education programs that encourage instructors and researchers to form alternative programs. Permit other private and public producers of non-instructional services to compete for the systems' business.
• The people who run higher education should be accountable for performing their respective responsibilities. The state should not micro-manage operations but should set clear standards of accountability about the mission of each of the systems.

Improving quality at the University of Minnesota

• Eliminate low-quality and low-priority programs and reallocate resources to higher priorities and meeting student and state needs through cooperative ventures. The state needs to decide if the University can be all things to all people.
• Develop a measurement system to evaluate the quality in all advanced degree programs and then produce report cards for each program, which came be used to reward program achievement.
• Strengthen advanced degree programs by concentrating on areas that offer significant pay-offs for improved quality, such as, high admissions standards to advanced degree programs and expanding grant programs and fellowship commitments.
• Improve human resource training and management to unleash the university's human capital resources. Faculty will drive quality improvements at the University. Therefore, faculty members must be properly involved, managed, and rewarded for improved quality and productivity.

Creating a higher education system using these principles will not be easy. But the current budget discussion indicates that the state is on a path of declining quality or higher costs, or both. The choice for Minnesota is clear. There is no option not to change. The state should choose major reform now and leave a legacy of better value for future generations.

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