Report: Tuition hikes could put college out of reach
State institutions urged to cut costs, operate more efficiently to lessen burden on New Mexico students
New Mexico offers some of the lowest tuition rates in the nation, but the state’s 24 public colleges and universities still run the risk of pricing students out of a higher education unless they cut costs and improve efficiency, according to a new state report.
The Legislative Finance Committee warns in the report, presented to lawmakers Tuesday, that tuition increases to deal with shrinking revenues from declining enrollment and dwindling financial support from the state government could make college unaffordable for a lot of people in a poor state such as New Mexico.
“With [one of] the highest poverty [rates] in the nation, even small tuition increases will threaten many New Mexicans’ ability to afford a college education,” the report states.
It comes as tuition increases take effect at several schools in New Mexico, and as in-state students who qualify for Legislative Lottery Scholarships saw the funding drop to 60 percent of tuition costs this year from 90 percent last year — and 100 percent for most of the past two decades — further increasing the burden on New Mexico families.
The report analyzed cost drivers for higher education, as well as efforts to improve efficiency and reduce duplication.
“The evaluation found that [higher education institutions] overprojected enrollment and planned for programs and space assuming significantly more students than actually enrolled,” the 72-page report states. “Though some [institutions] have subsequently taken steps to ‘right size’ their institutions, some have actually become less efficient and are spending excessive amounts on executive management and overhead with little resulting improvement in academic outcomes.”
At some schools, spending on executive management and institutional support far exceeded inflation.
“In particular, Western New Mexico University [in Silver City] and Northern New Mexico College [in Española] spent nearly twice the national benchmarks on administration, indicating they are overspending on their institution’s executives and administrative operations and not enough on providing instruction for their students,” the report states.
Northern New Mexico College President Rick Bailey said the report failed to include recent changes at the school.
“All higher education institutions received this report today, along with the public,” he said in a statement. “Northern New Mexico College will study the report, analyze its data and consider its recommendations. Northern has already made remarkable improvements in efficiency over the past few years, which the data in this report does not reflect.”
During the nearly three-hour hearing Tuesday, lawmakers raised a long list of questions and concerns about the findings of the report, including that New Mexico has the highest default rate on federal student loans in the nation.
“Pretty alarming stuff this morning — pretty alarming stuff,” said Rep. George Dodge, D-Santa Rosa.
Sen. John Arthur Smith, D-Deming, said he appreciated the report and the way it was presented.
“But I’m not certain we have anything in the report that I haven’t heard before,” he said.
The report also found that The University of New Mexico, New Mexico State University and Northern New Mexico College continue to subsidize their athletic programs with state-appropriated unrestricted funding,
which is meant for instruction and general purposes, and are still raising tuition.
“People who are putting their kids through college have lots of heartburn over that,” said the committee chairwoman, Rep. Patricia Lundstrom, D-Gallup.
Lundstrom was especially critical of UNM, saying the university’s Gallup branch was excluded from a general obligation bond request this year. No one representing UNM could explain why.
“I think on the surface, the proper answer is that it slipped through the cracks, but nobody was paying attention to it,” she said.
Lundstrom said she was disappointed “we don’t have administration here from UNM — for goodness’ sake, this is a major hearing for them.”
When she asked audience members if they represented colleges or universities in the state, a majority raised their hands, prompting Lundstrom to say, “They cared enough to be here, but UNM doesn’t, and they are the mother ship of the state … and take a big bulk of our budget.”
Cinnamon Blair, a spokeswoman for UNM, said the university’s government relations manager attended the meeting but that upper-level administrators were tied up Tuesday.
“Many UNM administrators were asked to meet with a visiting candidate for UNM president throughout the day,” she said in an email.
The report states that it is unclear how waning financial support from the lottery scholarship will impact enrollment. Lottery scholarships are covering only 60 percent of tuition this year because of declining lottery ticket sales, officials have said.
“In theory, it will lead to a decline in enrollment, but the magnitude of such a decline remains to be seen,” the report states.
The report concluded that “a lack of structure and incentives for statewide change” resulted in “discrepancies in higher education efficiency.”
“The New Mexico Higher Education Department has provided good leadership in tightening academic programming,” the report states. “But the department often has neither the funding nor the authority to guide the business decisions of the [institutions’] governing boards.”
The report makes a number of recommendations, including increasing funding and staffing for the department “to administer current statute on program approval and review in the state.”
Barbara Damron, the state’s higher education secretary, said she generally agreed with the report’s recommendations.
“There are none that I blatantly disagree with,” she said.
“There are some that you think that we could work on or just get them done this year?” Lundstrom asked, generating a few laughs from the audience.
“Madam chair, I’ve got, God willing, 14 months left,” replied Damron, who was appointed by Republican Gov. Susana Martinez, who is term-limited. “You’re going to get my all, and we’ll do everything we can.”