Features & Columns

Fee Increases at Public Universities Creating Generation Debt

Tuition, fees dog SJSU students while campus makeover masks priorities
SJSU Campus SCHOOL RAISE: Costs for students at public universities such as San Jose State have doubled in the last five years, while academic offerings have not increased anywhere close to the same pace.

Kelsey Lee, 21, expects to be tethered to roughly $30,000 in student loan debt when she graduates with her bachelor's degree in social work next year from San Jose State University. That number will likely increase, just as the cost of her tuition has over the years—and most jobs in her field require a master's degree.

"When you get out you can't start fresh," Lee says. "You're stuck. And you don't know if it was worth it. You might not find a job in your field or at all, but you still have to pay for it."

Lee's loans only cover her classes. In addition to maintaining an A average, she still works more than 25 hours a week at Starbucks. She saves on living expenses by commuting 45 minutes from Livermore, where she lives with family.

As students continue to make sacrifices in the face of budget cuts to education, some are starting to question whether the California State University system and its individual member schools, such as SJSU, are doing enough to make tuition affordable while keeping academics, a public university's central mission, a priority.

SJSU students paid fall semester bills that were more than double what they were at the brink of the recession six years ago. In the wake of massive state funding deficits, tuition at CSU schools has jumped from $2,772 per year in the fall of 2007 to $5,472 per year this fall. While the CSU governing body sets tuition, SJSU sets campus fees, which have also soared in that same time frame, from $860 annually to $1,656—the third highest of all 23 CSU institutions.

San Jose State's operating budget has fallen from $267.7 million to $248.5 million since the 2007 pre-recession allocation. (The school publishes a book every year breaking down the budget. The 2013/14 is not yet out, so all figures are from 2012/13.) To remedy the shortfall, SJSU President Mohammad H. Qayoumi cut $24.7 million from academic affairs, $5.6 million from administration and finance, and $2.6 million from student affairs for a total reduction of $33 million.

Three divisions were exempt from spending cuts: intercollegiate athletics, the president's office and university advancement.

San Jose faculty circulated a petition protesting the university's priorities earlier this year, gathering 50 signatures. "Your budget privileges non-teaching staff, administration, and programs over our students' educations," the letter stated. "We understand that cuts in Athletics might mean leaving Division I, but we must fund classes before we build that form of 'Spartan Pride.'

"We understand that cuts in University Advancement will affect fundraising, but money is urgently needed today, and in the classroom. We understand that cuts in your own office will not make a real dent in our problems, but we believe that university administration ought not simply manage, but to lead."

Students have echoed similar sentiments. "It's important we invest more money into classes if we're going to have higher tuition," says Cole Nibbett, student director of fee affairs. "There are students that can't graduate because there's not a enough classes."

It's a familiar conflict of interests. Students call for cheaper tuition, teachers want investments in education and universities want to build the school's prestige. It explicitly states in the priorities outlined in the budget that the president's office, which operates on $1.6 million, was protected to "support initiatives that will further SJSU's brand and reputation."

President Barack Obama's recent proposal to lower interest rates on student loans will have a slight effect, but it sidesteps the real problem: The bulk of student debt comes from tuition and campus fees. That balance has far-reaching and debilitating consequences. The federal government excludes all educational loans from bankruptcy. And unlike with standard debt, when borrowers default, the regulators can go to any lengths to ensure repayment, such as garnishing income, social security, tax returns and disability. That leaves it to universities to address the problem of rising expenditures.

SJSU has made news recently for exploring the potential of inexpensive online classes and raising more than $200 million in donations. Neither, though, is helping in a significant way to lower costs for students. Meanwhile, hundreds of millions of dollars are being spent on new buildings, athletics and other investments aimed at bolstering the school's brand.

The additional revenue from campus fees is going toward a $90 million earthquake retrofit and expansion of the student union, and a new health center that is expected to cost more than $33 million. A $54.7 million renovation of athletic facilities also began construction this year. This project is being paid for with state-issued capital bonds, though some associated costs will come out of the school budget, and, of course, bonds eventually have to be paid back.

President Qayoumi declined an interview request, but Barry Shiller, SJSU's vice president of marketing and communications, wrote in an email: "With regard to the Student Union specifically, numerous studies have shown that students engaged in campus life are more likely to be successful academically. We view that project, therefore, as intrinsic to improving the SJSU student experience."

Under the leadership of a new athletic director, the Spartans moved conferences in July. The department was exempted from budget cuts because the shift will cost $2 million over two years and one year of lost conference revenues, about $500,000. Intercollegiate athletics generated $2.2 million in revenue last year. Students such as Lee find themselves wanting a nice campus and successful sports program but are unsure about the pay-off: "You want to support athletics, but at the same time how many students are in athletics and how many of the rest of us are there?"

University advancement avoided cuts because it is in charge of fundraising, including the Acceleration campaign. President Qayoumi announced last month that the campus had raised nearly $209 million in private donations in its first major effort. According to an online breakdown, $54.8 million of that is designated for scholarships and fellowships. The rest is going toward facilities, faculty support, emerging programs, community service, global exchanges and research. One thing to note: Donors often specify where they want their money to go.

But looking at fiscal year 2010-11, just 10 percent of SJSU's expenditures were on grants and scholarships. San Francisco State spent 14.1 percent and Sacramento State reached 18.1 percent. With SJSU's budget of $248 million, the difference between 10 percent and 18 percent is $19.8 million.

Through a partnership with Udacity, an online education venture, San Jose is exploring the potential for online classes to improve accessibility. Last spring, in a program called SJSU Plus, the school began offering four online remedial classes at $150 a piece. Yet CSU students made up less than 11 percent of enrollment and the sessions were put on hold for the fall semester to improve the curriculum, as only about half of students passed the courses.

Last fall, SJSU became the first CSU institution to offer a Massive Open Online Course, known as a MOOC. In this blended learning model, lectures, quizzes and virtual labs are all held online. Then during class-time, students can work with the instructor in groups of three on problem sets. The online hybrid was only available for one upper-division engineering course, but after boasting a higher pass percentage than the standard section, administrators are looking into offering additional MOOCs as a way to save money and bolster learning.

President Obama proposed a plan several weeks ago that would rate colleges based on criteria such as affordability and graduation rates. Federal aid would be tethered to those ratings, meaning those at top-performing institutions will receive larger grants and cheaper loans.

The average amount of loan debt a CSU student carries is almost half the national average of public universities, putting SJSU, which also has rising graduation rates, in a good position. Still, that doesn't change Lee's future, which will surely be impacted by the cost of seeking education.

"Student loans weren't my main concern when I thought about going to college, but I'm starting to worry they should have been," says Lee, who will be the third person in her family to earn a college degree. "It changes everything. To be honest, I try not to think about it."