The Critical Issue:
The Wide Gap between Expectations and Reality
The critical issue lurking just below the surface in Virginia’s state and legislative elections this year is the wide gap between the education Virginians know they need for success and the educational level most Virginians actually are attaining.

A recent opinion survey by leading Republican and Democratic pollsters showed that more than 75 percent of Virginia voters believe a four-year or community-college degree is essential for success in the new economy. Yet only 35 percent of college-age Virginians currently enroll in college, and only 42 percent of working-age Virginians have college degrees. Our 2020 Vision provides a blueprint for increasing the percentage of Virginians with college degrees to 50 percent by 2020—an achievable goal that will place Virginia on course to be a national and international leader in educational attainment and personal income.

Decade of Disinvestment:
The Cost Burden Shift to Students and Parents
Virginians are proud of their higher education system. Many of our colleges and universities consistently rank among the nation’s best. But a dramatic decrease in state funding for higher education during this decade has charted an entirely new course—toward mediocrity.

Although the state’s general fund budget has grown significantly since 2000, funding for Virginia’s colleges, universities, and community colleges has declined sharply on a per-student basis. In constant dollars, per-student funding for Virginians at our four-year colleges and universities has dropped roughly 40 percent since 2000—from $10,675 to $6,586 (excluding the temporary federal stimulus funding). Our community colleges have incurred an almost 30-percent reduction in constant-dollar, per-student funding—from $4,930 to $3,477—during the same period. Much of this cost has been shifted to tuition-paying students, squeezing low and middle income family budgets during tough times, and increasing the student-loan debt burden on young people just as they are entering the competitive world of work.

Breaking the Cycle:
Sustaining Support in Good Times and Bad
Virginia must break the familiar boom-bust cycle of higher education funding by which state support for our colleges, universities, and community colleges is cut first and deepest whenever economic challenges appear. This cycle makes it impossible for students and parents to prepare for tuition costs and for higher education institutions to plan and manage resources effectively.

The failure to provide sustained levels of investment in higher education ultimately hurts all citizens, especially taxpayers. In the long run, they foot the bill for shortsighted cutbacks to a higher education enterprise that produces a positive economic return, growing tax revenues, and lower social service costs. They suffer, too, as the Commonwealth loses ground on business expansion and high-wage job creation to vigorously competing states and countries.

A Sound Investment:
The Economic Benefits of Higher Education
Grow By Degrees

advocates a sustained, long-term program of higher education investment, reform and innovation – embodied in state law – to ensure affordable access for Virginia students and to generate strong economic activity and growth revenues for the Commonwealth.

The economic benefits from higher education have been well-documented across the nation. College graduates (holding four-year degrees) on average earn about twice the incomes of persons without college degrees and pay thousands more in federal, state and local taxes. Lower levels of crime, reliance on public assistance and other social service demands are closely correlated with educational attainment, meaning that college graduates on average require substantially fewer services funded by tax dollars.  Colleges and universities are engines of economic growth creating thousands of well-paying jobs, attracting millions in research grants, contributions and tuition payments from outside the Commonwealth, boosting local and regional economies and preparing the highly educated and skilled workforce that serves as a magnet for new business investment and job creation.

The Virginia Business Higher Education Council (VBHEC) recently commissioned the respected Weldon Cooper Center for Public Service at the University of Virginia to conduct a comprehensive economic impact analysis that assessed the economic benefits of the public higher education system in Virginia and resulting educational attainment and income creation. Among the study’s key findings* are these:

 

• For every tax dollar the state invests in public higher education, the result is more than $13 in increased economic output.
• For every tax dollar the state invests in public higher education, the result is $1.39 in new state tax revenues.
• Virginia’s public higher eduction system:

–         Generates $24 billion in economic activity …

–         Accounts for 144,000 jobs …

–         Returns $2.5 billion in state tax revenues.

*All figures based on 2007 data and expressed in 2007 dollars.