IU looks to rely on private funding

As state funding becomes a smaller proportion of IU's budget and admissions standards go up, IU is beginning to look more like a private institution. Tuition has been consistently going up and admissions standards might be raised.\nUniversity officials said IU is relying less on state funding than ever before. With state funding accounting for only 21.2 percent of budget revenues for the 2005-2006 school year, compared with about 47 percent in 1975, a higher proportion of revenue is coming from tuition, private funding and research grants, said to Interim IU-Bloomington Chancellor Ken Gros Louis.\n"Public institutions have little choice but to find ways of capturing lost income that are not coming from state or public funding," said George Kuh, the Chancellor's Professor of Higher Education and director of the Center for Postsecondary Research at IU.\nKuh added the proportion of university budgets from non-public funds has been rapidly increasingly for "10 or more years."\nPublic institutions have historically relied on state funding, and have been able to keep tuition down. Private institutions, however, have not relied on the state.\n"Private institutions have always depended on (other) sources because they've never had any state funding," said Cheryl Fields, director of public relations at the National Association of State Universities and Land-Grant Colleges in Washington, D.C.\nTrustee Tom Reilly Jr. said decreases in state appropriations mean that IU is "heading towards a privatized institution" because a large portion of funding comes from private donors and research grants, much like many private institutions.\nGros Louis said IU needs to keep tuition affordable for students, and state funds were significantly less than 25 years ago.\n"When I became chancellor in 1980, for every dollar students gave to IU in tuition, the state gave $1.70. This year, for every student, the state is giving 45 cents," he said.\nReilly said since so much funding comes from grants and donors, IU is becoming a more research-based, more graduate student-based, institution.\nReilly said undergraduate students are going to be more geared toward pursuing graduate studies, meaning academic standards for IU-Bloomington will rise.\nIU-Bloomington "will increasingly be working on the development of a higher academic standard for its undergraduates," he said. He also added that students who may not qualify for IU-Bloomington can receive an education at community colleges or IU's satellite campuses.\n"Those students that cruise into Bloomington with a so-so set of credentials, it doesn't mean they won't be able to get a degree," Reilly added. "It just means they'll get a degree from one of the satellite campuses."\nOthers disagree.\nKuh said "it does not serve the greater purpose for which IU was founded" to pursue a more selective student body, and that IU is and should remain a university for Indiana.\nGros Louis said there is a "tripod" of necessities for any university: quality, diversity and access. Access, Gros Louis said, relies on the ability of a large selection of students to come to IU, and relies on IU's affordability.\n"You can get (any) two of the three," he said, "but when you get two, the third suffers."\nState contributions to all public universities from state and local taxes nationwide declined from 74 percent in 1991 to 64 percent in 2004, according to The New York Times.\nPublic institutions across the nation are responding to dwindling state appropriations in different ways. Miami University (Ohio) set a single tuition rate, with no differential between in-state and out-of-state students, which enables the university to take in higher tuition totals. The University of Virginia asked the Commonwealth of Virginia for a charter specifying what the state is responsible for paying after appropriations fell to 8 percent of the total budget in 2004.\nNationwide, public universities are feeling less pressure to abide by state recommendations because a lower portion of funding comes from the government. At the same time, universities feel more pressure to attract wealthy donors, which means large donations are often restricted to specific purposes.\nAccording to the Indiana Commission for Higher Education, the only formal power granted to the state is approving or disapproving academic programs. The state can make recommendations on other issues, but all other powers are granted to the trustees of the universities.\n"It's just really a money game," Reilly said.