Fictional divide tearing at our universities

Elliott Parker

Sunday, Jan. 29, 2012 | 2 a.m.

State Sen. John Lee recently repeated the charge that the Nevada System of Higher Education is biased in favor of Northern Nevada, and particularly that UNR is treated better than UNLV. Everybody knows UNR spends more per student than UNLV, right? Mark Twain once said, “There is something worse than ignorance, and that’s knowing what ain’t so.”

For those unfamiliar with Nevada history, UNR has been in Reno for 125 years, while UNLV graduated its first students less than 50 years ago — and then took off like a rocket. With such history, UNR had older buildings, along with older faculty, that were relatively more expensive to maintain. But times have changed, and that is past. The increased population and political power of Las Vegas has made it easier for UNLV to catch up in budgets. UNLV not only has more students, it now has more faculty and staff per student than UNR.

The past budget gap simply no longer exists. According to Nevada System of Higher Education calculations, UNLV’s operating budget is currently $11,790 per full-time equivalent (FTE) student, compared with $10,963 for UNR.

One reason the budget gap is gone is that recent budget cuts to UNLV were softened thanks to intervention from state legislators. Over the past three fiscal years, UNLV saw its operating budget fall by 9 percent while its student FTE fell by 2 percent, so its budget per student fell by only 7 percent. While state support for UNLV from the general fund fell by 24 percent per student, increased student tuition and fees made up for the difference.

In comparison, UNR enrollments grew by 12 percent while it took cuts of 11 percent, resulting in a net budget decrease per student of 21 percent. General fund support fell by 35 percent per student, but as with UNLV, tuition and fees made up some of the difference. Meanwhile, Nevada State College in Henderson took even bigger budget cuts of 46 percent per student FTE.

UNLV argues that it is underfunded, and it has a valid argument. However, every other institution in the state is also underfunded, all even more so than UNLV.

Are these differences the fault of the much-maligned funding formula? UNLV is currently funded at 72 percent, while UNR is funded at 66 percent. Other institutions, such as NSC and the College of Southern Nevada, are funded anywhere between 60 and 69 percent of what the formula calls for. Perhaps before we try to fix the formula, we should try funding it.

Of course, some find creative ways to create the appearance of budget gaps, by comparing apples to oranges for dramatic effect. UNR and UNLV both have combined budgets that go beyond their main campuses. UNLV manages the Boyd Law School and the School of Dental Medicine, while UNR manages the School of Medicine. UNR also manages Cooperative Extension, which operates throughout the state, and the Nevada Agricultural Experiment Station. Throwing these in to the per-student calculation is a bit like comparing the average height of patrons in two restaurants when UNLV center Brice Massamba stops by for a burger.

UNLV brings in relatively more students from out-of-state, many of whom come to the Harrah College of Hotel Administration. Using figures from the Brookings Institution, UNLV argues that it should be able to keep what these students pay in tuition, and it is an idea worth considering.

Under the current system, which nobody really likes, the Legislature sets the operating budget for each institution, and then subtracts what students pay in tuition and fees to determine what the state kicks in. It makes some sense that institutions should be encouraged to find additional revenue that they get to keep, though there is also a worry that too much incentive could lead the universities to eventually discriminate against in-state students.

But framing this as a North-vs.-South issue is simply wrong. If every institution kept its out-of-state tuition while the pie remained fixed, then each would have to take cuts of 7 percent in the rest of its budget. UNLV would be a net beneficiary, increasing its budget by 6 percent net, though the law and dental schools would each lose 2 percent net. It would be a wash for UNR, since it gets out-of-state tuition too. NSC and CSN would be net losers, however, along with every other NSHE institution. It is even more extreme if you include all student registration fees.

Another suggestion people have mentioned is to split the universities off from the community colleges. It might be a good idea from the management perspective, but as long as the budget is a fixed pie, it is unlikely to solve the funding problem. Nevada is one of only a handful of states where local governments do not pay a substantial portion of community college budgets. But right now, cities and counties in Nevada are having their own budget crises.

Does the north-south divide apply to community colleges? Since they are much less engaged in research, these community colleges cost less per student. But there are also economies of scale at work, since a large institution like CSN can spend much less per student than a small institution like Great Basin College in Elko.

What legislators promoting a north-south divide seem to forget is that we are one state. UNR also serves Las Vegas. About a quarter of UNR’s students come from Las Vegas, and UNR graduates get jobs in Las Vegas. If the sons and daughters of Las Vegans want to go to college away from home, as so many do, they are more likely to return home if they stay in the state. Nevada needs both its universities and all of its community colleges, and it needs more of its students to be able to attend them.

Promoting the north-south divide does great harm to higher education. By pretending that the north-south issue explains the lack of funding, legislators avoid dealing with the fact that we are the least-educated state in the nation. Nevada’s public higher education budget is the smallest share of gross state product in the nation. We have the fewest number of faculty and staff in higher education, as a share of population. Too few Nevadans have a college degree, or even a high school degree. Back when casinos and construction were the main drivers of our economy, we could get away with that. But now that Nevada has to reinvent its economy, we need a better-educated workforce and this is not helping.

Elliott Parker is professor and chairman of the UNR Economics Department.