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Higher Education Support in New Hampshire Still Lags Since Recession

While New Hampshire may have made some progress in the last budget cycle in restoring support for public colleges and universities, a national report released this week highlights just how much farther the state has to go to recover ground lost since the recession. In particular, it finds that state spending on public higher education in New Hampshire fell 27 percent between 2008 and 2015, on a per-student, inflation-adjusted basis. That drop is the largest of its kind in New England and the 12th steepest among the fifty states.

Support for Public Higher Ed Has Dropped Substantially Since RecessionThe report, published by the Washington, DC-based Center on Budget and Policy Priorities, calculates that state spending dropped by more than $1,200 per student over the 2008-2015 period after adjusting for inflation.  This overall decline comes even after combined General Fund appropriations for the University and Community College Systems rose from $135 million in the FY 2012-2013 biennium to $236 million in the FY 2014-2015 budget.

Consequently, the University System of New Hampshire, along with public colleges and universities across the country, has had to resort to substantial tuition increases since the recession to meet its costs. According to the Center on Budget’s report, average tuition at public, four-year schools in the Granite State has risen by 33 percent on an inflation-adjusted basis over the past seven years.

Undoubtedly, this situation is not exclusive to New Hampshire, as many states experienced a sharp decline in tax revenues due to the recession and weak recovery in its aftermath. The Center on Budget estimates that since the 2007-2008 academic year, published tuition (or the “sticker price”) at public four-year institutions has risen in each of the 50 states and by more than 20 percent in 33 states. What is more troubling in New Hampshire is that tuition for public institutions was already comparatively high, even before economic downturn. According to the College Board, in-state tuition and fees at the University of New Hampshire was $11,070 for the 2007-2008 academic year, fourth highest among all flagship state universities. By 2014-2015, that figure had climbed to $16,552, 60 percent above the median and second highest in the nation, behind only Penn State.

Tuition for Public 4-Yr Colleges Has Risen SharplyThis surge in the cost of public higher education has forced students and their families to bear a considerably larger share of the costs of higher education than a generation ago. As the Center’s paper notes, tuition now comprises nearly 50 percent of total education revenue at public institutions nationwide, up from just over 20 percent in 1988. In fact, New Hampshire is just one of seven states where tuition revenue makes up twice the share of total education revenue that state support constitutes.

Worse still, the shifting of more of the financial burden to students has occurred even as many Granite Staters have seen their incomes lose ground to inflation. According to the American Community Survey, the median household income in New Hampshire was $71,322 in 2013; in 2008, it was $71,596 (in 2013 inflation-adjusted dollars).

In April, the New Hampshire House passed its version of the budget for the FY 2016-2017 biennium, which is currently in the hands of the Senate. Under that budget, the University System would receive General Fund support of $153 million, an amount equal to its total appropriation for the FY 2014-2015 biennium, but $28 million less than the Governor’s recommended level. With the University System’s board of trustees already stating that the Governor’s plan was insufficient to keep in-state tuition at its current level, the House’s proposal exacerbates the situation for those New Hampshire families wishing to send their children to the University System. It will now be up to the Senate to restore much needed monies to higher education, in the hope of lessening the increased financial burden on many New Hampshire households.

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Declining Business Tax and Other Revenues Suggest Caution for State Budget

15 Aug 2019

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As policymakers continue to consider State Budget options and choices during the ongoing continuing resolution, understanding State revenue trends remains critical to determining the State’s ability to pay for needed services and the policy choices that affect available resources. With State Fiscal Year 2019 completed and SFY 2020 underway, recent months of revenue collections have provided some additional insight into whether the State might expect more revenue in future years. Questions remain about the future of business tax receipts in particular, which have been very difficult to predict due to recent abnormal behavior following the federal tax overhaul; however, recent data suggest anticipated declines in receipts may limit revenue going forward.