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Are ‘Charter Universities’ the Future of State-funded Higher Education?

On the face of it, the budget proposal that Ohio Governor John Kasich released this week looks like terrible news for state universities. Not only would Kasich’s plan slash higher education spending by 10.5 percent, it also would cap tuition increases at 3.5 percent a year.

So it might come as a surprise that some university presidents received the plan warmly. Within hours, Ohio State University President E. Gordon Gee released a statement praising the governor for “understanding that higher education and our state’s long-term strength are inextricably linked.”

Gee’s optimism rests on another aspect of the governor’s budget. In exchange for the budget cuts, Kasich would give state universities more autonomy in running their day-to-day affairs. Long-term, that could save schools money. “We at Ohio State continue to move aggressively in both advocating for regulatory freedom and reconfiguring and re-inventing our institution,” Gee said.

With states mired in their fourth straight year of budget shortfalls, many university presidents around the county seem willing to make deals like the one in Ohio. In states such as Oregon, Louisiana and Wisconsin, flagship universities are inching away from their traditional patrons in the Statehouse, accepting lower levels of state funding in exchange for freedom from state regulations. 

The result may be a new relationship between states and their public universities. For state leaders, that relationship may wind up being less of a budget drain, but politicians will have less leverage to tell universities what to do and how to do it. For universities, less state funding and oversight is likely to come with higher tuition and more reliance on private-sector funding. At the same time, it will raise questions about the core mission of state universities, whose original purpose was to offer an affordable education.

The holy grail for a lot of flagship institutions is full tuition autonomy,” says Rich Nova of the Association of Governing Boards, which represents university boards. “When you strip everything away from it, that is basically what these institutions want. And full admission autonomy, which means that they can admit more out of state students and get out-of-state tuition.”

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