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Wellman calls for more transparency, new financial models

Across the nation, research universities are facing the same challenges as the University of California: disinvestment from the public sector, a push to find more efficient ways to operate, and worries that quality and access are beginning to suffer.

That’s the assessment of Jane Wellman, a nationally renowned expert on higher education policy and funding trends, who spoke to OP staff Oct. 5 as part of the President’s Speaker Series, which launched last month.

Wellman, the executive director of the Delta Project on Postsecondary Education Costs, Productivity and Accountability, said that there is a real mismatch between public perceptions and fiscal realities.

“Universities have been cutting costs, even as (tuition) prices have gone up. The public assumes that prices are going up because universities are spending more money,” Wellman said.

In fact, universities have held educational costs down; tuition increases rarely make up more than about half of what has been lost in reduced subsidies, she said.

Given the nation’s deep economic problems, there are no easy answers to the financial predicament that universities and colleges find themselves in, she said. Federal spending is unlikely to replace what’s been lost at the state level. And despite declining state subsidies, policymakers and the public often think that universities and colleges have plenty of money.

All of which points to the need for universities to do better at explaining how they are funded, in being transparent about how they use their financial resources, and in looking for new financial models, she said.

“We need to maintain, and in some cases, rebuild the public trust so that people believe universities are prudent users of public resources,” Wellman said.

She noted that even a few years ago, few universities talked publicly about administrative efficiencies and being effective with their resources.

“They worried about looking anti-academic. That’s really changed. Everywhere in the country, the conversation is alive about how to be more efficient.”

Central offices like UC’s Office of the President have an important role to play in providing the kinds of services that are most cost-effective at a systemwide level. That includes things like purchasing, finance, and legal services.

Systemwide offices should also play a role in shaping state policy. She noted that as state governments grow weaker, universities can and should step into the void — especially on relevant issues like economic development, jobs creation and ensuring that K-12 education is succeeding in preparing students for college.

“You have a role to play that can’t be done by 10 individual campuses,” Wellman said.

Re-engaging a public discussion about the value of higher education is a key piece of that, she said.

“There is no reason that our country needs to disinvest in higher education at this time,” Wellman said. “There is no reason that this generation of students is any less deserving than those who came before.”

The Delta Project on Postsecondary Education Costs, Productivity and Accountability is an independent non-profit research and policy organization.
Read its most recent report: Trends in College Spending 1999-2009: Where Does the Money Come From? Where Does It Go? What Does It Buy?

Wellman is also Executive Director of the National Association of System Heads.

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