Financial Stress,More Colleges Cap Enrollments

November 27, 2008

admissions California State University has long prided itself on being open to all qualified students, but that’s about to change.

As record numbers of applications collide head-on with deep budget cuts, the nation’s largest university system announced plans Nov. 20 to decrease its student body by at least 10,000 students and to cap enrollment at all of its 23 campuses. Says Terry Hartle of the American Council on Education, a lobbying firm that represents 1,800 colleges and universities: “What you’re seeing in California is a double witching hour.” Cal State, which experienced a 20% increase in first-year applications this fall, is the first public university to cap enrollment since the market meltdown in September, a move other schools may follow as 21 states grapple with midyear budget cuts to public colleges and universities in the wake of financial Armageddon.

With 77% of CSU’s operating budget coming from the state, shrinking tax revenue had already left the school starting out this academic year in a $200 million ditch. Things got worse on Nov. 6 when California Governor Arnold Schwarzenegger announced an additional $66 million cut. Now university officials say they simply don’t have enough resources to serve all the students who want in. “It’s not fair to students to admit them to a university and not be able to offer classes, sections, and student services that they need, and academic advising and help that students deserve,” says CSU Chancellor Charles Reed. Cal State tried to cope with the economic downturn in the early 1990s by increasing overall class size, but many students could not enroll in the courses they needed and ultimately dropped out. The school is trying to avoid repeating those mistakes this time around.

Until now, only six of CSU’s campuses had competitive admissions standards over and above the system-wide requirements of a 3.0 high school GPA or high enough scores on the SAT or ACT to compensate for lower grades. Under the new rules, all campuses will still have to admit all eligible freshmen in their immediate vicinity, but many of the schools will up the academic bar for students from farther away. Turning away paying students might seem counterintuitive in a time of need, but tuition accounts for just 23% of Cal State’s funding (even after a 10% hike last year). That’s on par with Harvard, where tuition accounts for about 20% of the school’s revenue — but a multibillion dollar endowment makes up the difference. On average, tuition covers about half of total educational costs at public universities.

With CSU set to stop accepting applications at several campuses on Nov. 30, administrators expect that many students will turn to community colleges with the goal of transferring to Cal State two years down the line. According to a survey released by the American Association of Community Colleges in July, 66% of state-wide community college directors expect that enrollment caps at the state level will boost demand at their institutions. The problem, however, is that community college directors in 16 states already report they can’t meet the demand from high school grads as is. That means if they get an influx of applicants who would normally have gone to a four-year state school, some students may have to delay their college plans or get pushed out of the system altogether.

Administrators fear that students of color will take the hardest hit. Many of these students tend to live in underserved communities, to be unsure about how and when to apply for financial aid, and to make up their minds about college later in the school year. “Those are the students that America needs to reach out to, because they are going to be the work force of the 21st century,” says Reed. “And they will probably be the group that will be the most at risk” of getting squeezed out by an enrollment cap.

Still, for students already enrolled at Cal State — or for those lucky enough to gain admission under the tougher standards — the crackdown could ensure the quality of their education. The cap should prevent classes from getting so big that there’s not enough, say, lab equipment or academic advising. It will also increase the likelihood that students will be able to get a spot in each of the classes they need to take in order to graduate, thereby saving many students from a costly fifth (or sixth) year.

How long CSU’s enrollment cap lasts — and whether more universities adopt one — will depend on how quickly the economy recovers. In the meantime, public universities face tough choices. When state schools get hit with major budget shortfalls, “the only question is how the losses are distributed,” says Hartle. “Nobody wins.”

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