Why is my tuition so high?

Mass communication major and Rock Hill resident Oriana Gilmore started attending college two years ago, and this is her first academic year where she had to take out federal loans. Winthrop relies on in-state students more than other South Carolina colleges and universities for tuition funds. Photo by Zuri Anderson / The RMR.Mass communication major and Rock Hill resident Oriana Gilmore started attending college two years ago, and this is her first academic year where she had to take out federal loans. Winthrop relies on in-state students more than other South Carolina colleges and universities for tuition funds. Photo by Zuri Anderson / The RMR.

Winthrop’s high tuition rates illustrate the embattled and struggling political condition of South Carolina postsecondary and higher education

Oriana Gilmore, a mass communication major and Rock Hill resident, has been in college for two years and never had students loans until this academic year.

“This semester was my first time having loans. I didn’t really understand them,” Gilmore said.

Her family is moving out of Rock Hill, and she will be moving into Campus Walk apartments, an off-campus residence, next semester. Gilmore said that it was more affordable since she will not have to worry about paying for a meal plan.

“Even with the refund I’ll get with the loans, I still won’t have enough money to pay three months worth of rent,” she said.

Gilmore also said her mother could not sign for a Parent Plus Loan, which is a federal loan parents of college students could use to help fund their child’s college education.

“She already co-signed for my apartment and my car. She also has her own car, and her own place,” Gilmore said. “If you have too many ‘debts’ they call it, they won’t allow you to get it.”

For the next two years as a college student, Gilmore said she is concerned about funding in the future.

“The scholarships, grant money and loans that you get… goes to tuition. And then you have to pay for books, lab fees, especially for mass communication classes, and other things,” she said.

Gilmore said her main concern is trying to pay for housing, but she also has to worry about food, textbooks, and other supplies. Because of her course schedule next semester, Gilmore cannot continue her on-campus job and must also search for another job that fits her schedule.

Students of various backgrounds experience some form of hardship that will affect their ability to pay for their tuition. Many students on campus sometimes ask this question in regards to the price of attending Winthrop University: why are the tuition rates so high? The question is not so easy to answer, however.

Rising costs, but no fall in sight

A freshman Winthrop student at Winthrop struggles with paying their tuition. Their father lost his job during their senior year in high school, and the Free Application for Federal Student Aid (FAFSA) process has always been difficult for them. The student asked to remain anonymous due to how intimate her story is.

“It is hard for him to fund me through my education considering that he lost his job so close to me actually attending school,” the student said. “My dad also got married a few years back which messed up my FAFSA, as well, because now I come from a two-income home instead of a single which also bumps up the price,” the student said.

The student said the FAFSA “never treated them well,” because of long time periods for response and processing. As a result, the availability of financial aid was always uncertain for the student.

Winthrop students have to pay more than the national average and South Carolina average tuition rate for public four-year institutions, not including financial aid. Photo by Zuri Anderson.

Winthrop students have to pay more than the national average and South Carolina average tuition rate for public four-year institutions, not including financial aid. Photo by Zuri Anderson / The RMR.

“I never understood it, and it took me almost 6 months to finish it. It was so difficult, and they kept telling me it was submitted. But, like a month later, my dad would get an email saying that it was unfinished even though they told me it was submitted. Submitting it so late also made it difficult to receive any aid from the government,” the student said. “I wasn’t able to bring my car to campus because I wouldn’t be able to afford gas, and it cost a lot for parking.

Despite these troubles, the student said this will not affect her attendance in class. “Knowing my dad is struggling just to pay makes me want to work harder for my end goal,” they said. “I try not to miss school, and I work hard to make my dad proud.”

The second biggest state policy issue for higher education was affordability, particularly rising tuition costs and student debt, according to the Top 10 Higher Education State Policy Issues for 2017 report by the American Association of State Colleges and Universities.

To understand Winthrop’s situation, one needs to refer to the overall problems with higher education in South Carolina. According to the South Carolina Commission on Higher Education (SCCHE) in a presentation regarding four-year public institutions, one of the current issues in higher education in South Carolina is the excessive tuition rates. The average in-state tuition rates at four-year colleges and universities have increased by 266 percent over inflation since 1987. This did not include tuition and board. Comprehensive teaching colleges, including Winthrop, College of Charleston and Coastal Carolina University, had faster growth: 278 percent.

South Carolina also had the second highest average tuition rates among four-year public colleges and universities among southeastern states, at $12,615. Virginia was first with an average tuition of $12,820 — a difference of $205. The average net price of attendance at four-year public institutions for first-time, full-time undergraduate students was $13,400, according to the Condition of Education 2018 report, “a congressionally mandated annual report summarizing important developments and trends in education using the latest available data.” That statistic is based on data from the 2015-2016 academic year. South Carolina’s average tuition rate for four-year public institutions is $785 under the national average.

The SCCHE also noted an underlying cause for increasing tuition prices: excessive expenditure growth. “Expenditures have grown 173 percent since 1993, a rate that is 1.5 times greater than student body plus inflation growth.” This means while student enrollment increases, four-year public colleges, and universities have been spending more to accommodate. State funding has only increased by 43 percent between 1994 and 2015, not keeping up with student growth or inflation. These state funds include the South Carolina Education Lottery scholarships and appropriations.

As a result, there is an increase in net tuition by 402 percent between 1993 and 2015, the revenue that includes net federal and state scholarships and abatements. Students had to pay out-of-pocket to account for these increases, even with financial aid. The SCCHE claimed that “if tuition had … grown at population plus HEPI inflation, students would collectively pay 590 percent million less. In-state tuition would be $7,157 in 2017.”
The increase of tuition growth overall is rapid, compared to health care, housing and median income increases according to the SCCHE, the U.S. Bureau of Labor Statistics, the Federal Reserve of St. Louis and the Integrated Postsecondary Education Data System (IPEDS). Between 2000 and 2015, higher education costs have increased by 7.8 percent, while median income, by comparison, has increased by 1.4 percent. Since 1987, South Carolina higher education costs have increased by 761 percent, compared to the United States’ increase of 549 percent.

The SCCHE published in their 2017 Statistical Report a ten-year comparison of state education recurring appropriations from the fiscal year 2007 to the fiscal year 2016. They also published a tuition and fees schedule for South Carolina colleges and universities between the fiscal year 2013 and fiscal year 2017; the report accounts for full-time students.
The Citadel and Coastal Carolina University received fewer appropriations from the SCCHE but they have less tuition than Winthrop University for fiscal years 2016 and 2017. However, Winthrop’s tuition increase has been relatively stable for both in-state and out-of-state students compared to other comprehensive teaching colleges and universities.

John A. Carlos II, a freelance photojournalist who contributed to The Post and Courier, argued that South Carolina colleges and universities are “at risk of financial collapse.” The schools rely on tuition dollars and student enrollment, which is not a sustainable model. Household income lags behind increasing tuition rates, placing more of a financial burden on college students and their families.

Winthrop is facing this situation. While not on the brink of financial collapse, student enrollment and retention rates for the institution are down for the 2018-2019 academic year. This means that Winthrop lost roughly $4.4 million.

However, most of the blame for insufficient funding does not come from Winthrop and other South Carolina colleges and universities.

The role of public policy and state government

“Colleges, much like businesses, set tuition prices based on revenue minus expenses. When the Legislature cuts higher education funding, expenses go up while revenue stays the same. And the way a student gets tuition money, whether from student loans, personal savings or a lottery scholarship — does nothing to change a college’s revenue or expenses,” Joe Galbraith, a spokesman for Clemson University, said to The State.

Colleges and universities in South Carolina have tense relations with the state legislature when it comes to funding. The SCCHE’s 2017 presentation on the issues of higher education said “These issues are symptoms of a larger, underlying cause… Unsustainable expenditures.” They are pointing to the spending of colleges and universities. According to a variety of South Carolina news media, the issues with funding higher education also come from the legislature and state departments.

South Carolina Governor Henry McMaster was re-elected this past November for the gubernatorial elections. McMasters proposed a Student Bill of Rights to address issues in South Carolina higher education, but the plan drew criticism from college leaders for not having a discussion with actual colleges and universities. Photo courtesy of The Charleston City Paper.

South Carolina Governor Henry McMaster was re-elected this past November for the gubernatorial elections. McMasters proposed a Student Bill of Rights to address issues in South Carolina higher education, but the plan drew criticism from college leaders for not having a discussion with actual colleges and universities. Photo courtesy of The Charleston City Paper.

South Carolina Governor Henry McMaster was re-elected this past November for the gubernatorial elections. McMasters proposed a Student Bill of Rights to address issues in South Carolina higher education, but the plan drew criticism from college leaders for not having a discussion with actual colleges and universities. Photo courtesy of The Charleston City Paper.

Governor Henry McMasters’ proposal for the Student Bill of Rights in South Carolina addresses current concerns about financial aid, student loan debt, and high tuition costs. The Student Bill of Rights and its viability is another attempt by the state of South Carolina to aid students but could spell more difficulty for South Carolina colleges and universities in terms of funding.

However, it has drawn a lot of criticism from College of Charleston and Clemson University leadership due to not addressing adequate models for state funding. Even though the Student Bill of Rights was developed “based on feedback from state lawmakers and comments from attendees at town hall events,” the SCCHE failed to reach out to actual colleges and universities about their grievances and lack of funding from the state, according to Greenville News.

That is not the end of the state’s woes when it comes to handling the regulation of colleges and universities.

The South Carolina Education Lottery has enjoyed great financial success. The purpose of the lottery was to provide scholarships for the state’s high-achieving students, such as the South Carolina LIFE Scholarship. It has raised over $5 billion since its inception in 2002, but South Carolina students still suffer from steep student loan debt and some of the highest tuition rates in the Southeast. The state also ranks No. 1 in the nation for student debt as of June 2018, according to the Greenville News.

The State chronicled the failed endeavors of the South Carolina Education Lottery, which serves as a supplement to funding education in general, including Pre-K through high school. Scholarships, in general, are not equivalent to the direct funding of public institutions, according to University of South Carolina spokesman Jeff Stensland to The State.

“Instead of using that money to boost education spending overall, as state law requires, lawmakers have cut higher education funding by $4 billion and replaced it with lottery funding — the lion’s share of which goes to scholarships for high-achieving students,” The State reported from the Legislative Audit Council.

“20 cents of the education funding goes to higher education, libraries, scholarships, and other programs. Roughly four pennies of that dollar makes its way down to the local classroom,” according to Live5News.

Any remedial actions or solutions for tuition rates and budgeting would have to come down to the states, according to Laura Ullrich, the associate dean for Undergraduate Programs and an economics professor at Winthrop. Her research background is in public finance, the intersection of government and economics, particularly education economics.

North Carolina and Tennessee launched programs for affordable postsecondary education called “Promise.” These schools have very low tuition rates to the point that federal Pell Grants would cover the student’s tuition. The only thing students would have to pay out-of-pocket would be room and board, meal plans or any extraneous fees.

The North Carolina Promise … are three schools in the state where in-state students can go for $500 per semester. That’s UNC Pembroke, Elizabeth City [University], which is an HBCU I believe, and Western Carolina [University]. You can go out-of-state for $2,500 a semester. It’s cheap to go to those schools now. But, the state has to fill in that gap,” Ullrich said. The Tennessee Promise program is where anybody can go to community college for free in Tennessee.

“So, some states have done something. South Carolina has not done anything,” Ullrich said. “It’s very hard for the individual institutions to do anything, because … we are very limited in the revenue sources that we have. Without cutting programs or slashing large portions of the budget, it’s hard not to manage in today’s climate without having relatively high tuition.”

What does this mean for Winthrop?

The university creates a balanced budget every year, but over the last few years, the budget was exceeded. This meant that Winthrop was not able to put “money back into the bank for future use,” according to Justin Oates, the chief financial officer and vice president for Finance and Business at Winthrop.

“It is important to note that Winthrop falls well below industry standards in regards to our unrestricted net position (money in the bank) which is why it has been important to put money in the bank the last few years,” Oates said. “Going forward, it will be important to balance the unrestricted net position balance and the needs (especially facility) on campus.”

Winthrop brings in very few out-of-state students, which affects how much revenue the institution makes, according to Laura Ullrich, who has a Ph.D. in economics. As a result, Winthrop is relying more on in-state students to bring in tuition, which makes up almost 85 percent of their $120 million budget for the 2018 fiscal year. Almost 15 percent of the funding came from recurring state appropriations.

“We are 90 percent in-state. If you look at other state institutions, like College of Charleston, Coastal [Carolina University], even USC – they are very heavy out-of-state, but those students pay a lot more for their education,” Ullrich said. “I personally think that having more out-of-state students are a good thing because they are paying more for the same education and service.”

Laura Ullrich has served as an economics professor and the associate dean for Undergraduate programs during her 12 years at Winthrop. She has witnessed the College of Business Administration’s federal funding deplete despite needing to update courses, faculty, and equipment to stay competitive and modern. Photo courtesy of Winthrop University’s faculty and staff Pinterest board.

Laura Ullrich has served as an economics professor and the associate dean for Undergraduate programs during her 12 years at Winthrop. She has witnessed the College of Business Administration’s federal funding deplete despite needing to update courses, faculty, and equipment to stay competitive and modern. Photo courtesy of Winthrop University’s faculty and staff Pinterest board.

Ullrich has been at Winthrop for 12 years. She said she witnessed the funding for the College of Business Administration shift significantly following the 2007-2008 recession.

Shortly after the recession hit, many states slashed higher education spending. We used to get a significant amount of money every year from the state, now we don’t anymore. I would say ten years later, some of the money has come back, but very little,” she said.

Colleges and universities have to operate very differently before when upwards of 50 percent of the money came from the state, according to Ullrich.

“That’s why the tuition has gone up so much because when we don’t get as much money from the state to operate from somewhere, and that has to come from tuition dollars,” she said. “You can get grants, and there are other ways to get additional money, but tuition dollars are the primary source.”

One of Winthrop’s biggest appeals is the small class sizes. The student-faculty ratio is 14 to one, and 49.1 percent of Winthrop’s classes have fewer than 20 students.

“You have to be careful about how you spend money and how you allocate resources,” Ullrich said. “We have intentionally stayed with smaller classes, having full-time tenured faculty members teaching classes as opposed to relying on adjuncts or graduate students. It’s nice but very expensive, so we don’t have a lot of money left over. We’re able to operate relatively clean, but it’s tough though.”

“The state also requires us to invest in the statewide pension which has increased substantially in the last few years,” Oates said. “Other key issues include our need to invest in facilities and deferred maintenance on campus that has built up over the years and means we must invest in our facilities to ensure our campus meets the needs of students.”

Winthrop relies on a variety of external funding to keep up its operations from student services and educational expenses to maintenance and various programs. In the fiscal year 2016, Winthrop received over $1.6 million in earmarked funds for renovations, repairs, construction, infrastructure maintenance and other miscellaneous expenses related to land and buildings, according to a spending transparency report from the South Carolina Comptroller General’s webpage on sc.gov. Winthrop received no federal funds for these projects.

Winthrop received almost $2 million in funding just for the renovation and maintenance of existing buildings on campus. Photo by Zuri Anderson / The RMR.

Winthrop received almost $2 million in funding just for the renovation and maintenance of existing buildings on campus. Photo by Zuri Anderson / The RMR.

Despite its funding disadvantages, Winthrop still ranks in the top 30 for southern public colleges and universities in the U.S. World News Report. “74 percent of full-time undergraduates receive some kind of need-based financial aid, and the average need-based scholarship or grant award is $8,744,” according to USNews.

With the Winthrop Plan President Daniel Mahony proposed in 2015, Winthrop is currently making strides to improve itself while keeping itself funded sufficiently.

“To help attract students to Winthrop, the committee on institutional advancement and development is working to increase the number of events on campus, as well as dedicating 64 percent of the marketing budget toward digital marketing,” according to The Johnsonian, Winthrop’s weekly newspaper. To improve retention rates at Winthrop, President Mahony proposed adding new academic and non-academic programs, as well as “destination programs” unique to Winthrop.

Oates said the institution is focused “on program development and ensuring we offer programs that students want while also ensuring we continually look at technology and facility needs on campus.”

While Winthrop’s “sticker price,” which is the cost advertised in their official materials, is highest in South Carolina, the actual cost paid by students is “about the middle of the pack once you add in scholarships supported by Winthrop,” according to Oates.

“In addition, a lot of schools charge program fees which are not part of the published rate and increase the actual amount paid once students get into their major,” he said. “[This] means Winthrop is not the highest costing university in the State when these other factors are considered. For example, Clemson charges $1,000 program fees for business majors that is not part of their published university tuition.”

What would aid the growing cost of in-state tuition is political advocacy. Laura Ullrich noted that there is a lack of a constituency for college students and higher education.

“The state is funding all sorts of different things, but some of the main things is K-12 education, higher ed, jails, roads, health care,” Ullrich said. “Most of those are very difficult to cut because if all of a sudden, they’re going to announce that they’re going to let a bunch of people out of jail, people go nuts. If they say, they’re going to close down an elementary school, people go nuts. Higher ed is an easier place to cut.”

People, especially parents with younger children, are unaware of the expensive costs of college. Most elderly people do not pay attention as well because their children are already adults and possibly done with college. There is also a lack of constituency in counties where there are not a lot of higher education institutions, so citizens are not as concerned. College students usually do not vote as well, according to Ullrich.

“Politically, there aren’t as many people who get irritated about it. I don’t think it’s the only reason, but I think it’s a significant reason. Clearly, if you’re in a college town like Rock Hill, there are going to be more constituents that care about higher ed. When state lawmakers are looking at what to cut, they have to respond to their constituents,” Ullrich said.

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