As Students Struggle to Pay Tuition, Schools Scramble to Trim Budgets

HOLLY SNIFF, who is the first person in her family to attend college, found out about making hard choices early on. "I really wanted to go out of state for school, but because of financial reasons I couldn't," says Ms. Sniff, who is now a sophomore at the University of Virginia in Charlottesville.

For as long as she can remember, Sniff has been putting away money for her education. "I saved every dollar I was given as birthday presents or special treats as a child," she says.

Those childhood savings along with summer earnings and additional financial help from relatives got Sniff through her first year of college. But tuition continues to rise, and Sniff, along with millions of other students, is struggling to keep up.

At the same time, both private and public colleges and universities are moving beyond trimming at the margins to control costs.

Many schools are freezing faculty salaries, suspending hiring, delaying building maintenance, limiting course offerings, and even cutting academic departments.

Administrators are finding that they can no longer fund every project, department, or program. In the 1991-92 academic year, 57 percent of all colleges and universities were forced to reduce their operating budgets, according to an annual survey by the American Council on Education in Washington, D.C.

At the University of Vermont, a budget committee's proposal to eliminate the School of Engineering led to an uproar and the eventual resignation of the university's president.

AS state funding shrinks, public universities are being forced to increase class sizes and cut back on student services. Students at California's public universities have staged massive student protests against overcrowded classes and eye-popping tuition increases.

Nationwide, public colleges raised their tuition and fees an average of 10 percent and private-college increases averaged 7 percent this year, according to the College Board's annual survey released last month.

"Given the state of the economy and its impact on state budgets, many people expected much larger [tuition] increases this year, particularly in the public sector," says Donald Stewart, president of the College Board.

The rate of increase for public-college tuition is actually down this year compared with last year's 13 percent rise. And private colleges held their increases to last year's rate.

Yet that doesn't mean tuitions are gravitating back to earthly levels, warns Arthur Hauptman, a college tuition consultant.

"What the public tuition number says is that the recession has eased a little bit," he says. "If things get better [in terms of the economy], you would expect to see some additional reduction in those numbers."

In the '90s, Mr. Hauptman points out, there is much more competition for state funds than there was in the 1980s. Health care, prisons, and elementary and secondary education are all clamoring for funding.

"Despite predictions at the beginning of the '80s that it would be a tough decade, it turned out to be a very good decade for higher education in terms of revenue growth," Hauptman says. "Every major revenue source for colleges grew in real terms during that time - federal, state, tuitions, endowments, sales, and services."

And how were those revenues spent? Some faculty critics argue that the funds were spent on administrative bloat. "The fact is that in the '80s administrative staff at both private and public colleges grew much faster than the faculty," Hauptman says. "It is also true, however, that in the 1980s faculty salaries increased in real terms."

Last year, Rep. Patricia Schroeder (D) of Colorado launched a congressional investigation into the skyrocketing cost of tuition at public colleges.

"When it comes to college education, American families are paying more and getting less," she said. "Since 1980, the cost of sending our kids to college, a key part of the American dream, has doubled or tripled the rate of inflation every single year."

The investigation found that the growing research orientation of public higher education has fed the spiraling tuition costs. The teaching load of professors dropped from the traditional 15 hours per semester to as low as six hours per semester at some institutions, according to the study.

Pinning down the cause of increased tuition at either public or private universities isn't easy. Education is a labor-intensive enterprise that does not lend itself to productivity gains, administrators argue.

"Because faculty salaries have lagged in the past and because of competition for faculty among universities and industry, faculty compensation [increases] now exceed inflation," points out Paul Locatelli, president of Santa Clara University in Santa Clara, Calif.

Yet it is possible to increase teaching loads, reexamine the length of the academic year, and de-emphasize research in an effort to gain productivity, argues Hauptman.

"Colleges want to increase their resources; it's a natural inclination," he says. "If you read the college presidents' letters to the parents, you would assume costs are pushing tuition increases. But I think it's more that the revenues provided by the tuition hikes allow the schools to increase costs."

Meanwhile, students like Holly Sniff are willing to work harder or borrow more in order to get a college degree. Sniff expects to have accumulated about $10,000 in loans before she graduates. "I think I'm better off taking out loans now and using my life savings so that hopefully in the future I can find a better-paying job," she says.

Increased indebtedness raises the stakes for many students. "I'm not really concerned with it now," Sniff says, "but as soon as I graduate I'm going to have to get a good-paying job to pay off all of these loans."