Policy Documents

Higher Education in South Carolina: Cut Administrative Costs and Focus on Student Performance

Simon Wong –
September 28, 2010

While South Carolinians can take pride in our state’s higher educational system, costs and tuition have skyrocketed in recent years, even as graduation rates remain below 40 percent. At the same time, South Carolina’s leading universities have been drawn away from their core mission and increasingly become conduits for the Legislature’s economic development plans. The solution is to refocus on student performance, cut administrative costs and look to innovative technology that will improve both access and affordability.

Higher Ed Spending Has Increased 77 Percent Over 10 Years

Overall spending for the state’s 10 public institutions has increased 77 percent over the past 10 years (FY01-2002 to FY10-2011). During the same period, General Fund appropriations have declined from $546 million to $327 million. But combined Federal Fund and Other Funds (derived from fines and fees) appropriations have jumped from $1.35 billion to $3.02 billion – a 124 percent increase. (State Budget Documents)

Tuition rates have also increased rapidly over the past 10 years, with a 133 percent increase for in-state students and a 110 percent increase for out-of-state students. The College of Charleston had the highest in-state increase: 173 percent. S.C. State had the “lowest” in-state increase at 110 percent. In-state tuition increases outpaced out-of-state tuition increases at 8 of 13 campuses. (Source: Commission on Higher Education)

Administrative costs have risen substantially, with a 60 percent increase from FY02-2003 to FY07-2008 (latest data available). During the same period, the proportion of administrative to instructional spending also increased: from 15.5 cents spent on administration for every dollar spent on instruction to 18.0 cents spent on administration for every dollar spent on instruction. (Source: ACTA and IPEDS)

Debt and capital spending has also skyrocketed. As of FY08-2009, the state’s 10 public universities and 16 technical colleges had accumulated $1.162 billion in debt: $354 million in general obligation bonds and $808 million in revenue bonds and notes. Current and future interest payments for this debt come to about $500 million. Thus, total higher-ed debt, plus interest, exceeds $1.5 billion. (Source: State CAFRs)

4-Year Graduation Rate Less Than 40 Percent

The 4-year graduation rate at the state’s public higher educational institutions is 38.8 percent. The six-year rate is 60.5 percent. Seven schools had a 4-year graduation rate of less than 50 percent. [1] Five schools had a 6-year graduation rate of less than 50 percent. (Source: Commission on Higher Education)