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Reaching 'a tipping point' for affordability of college As costs of higher education soar, an insatiable appetite to get better draws a comparison to the Cookie Monster

Everyone from President Obama to the graduates at May commencements can tell you how the cost of a college education is rising.

Why is not always as clear.

But as students graduate from college with record levels of debt -- many without jobs to pay back their loans -- the focus is more and more on higher ed to explain:

Why so expensive?

"I think the public agitation has grown enormously in the past couple years, and the reason is because people feel they're at a breaking point," said Richard K. Vedder, director of the Center for College Affordability and Productivity in Washington, D.C.

Institutions blame rising tuition on any number of factors, from escalating employee costs to declines in state aid to greater expectations from students.

Critics such as Vedder paint a picture of a broken, inefficient system with too many administrators, expensive new facilities and unnecessary services and programs -- all pushing up the price of college for families.

"For years, the solution was, 'Let's borrow more,' " said Vedder, an economics professor at Ohio University, "but we're at a tipping point on that."

At the root are aspirations of colleges and universities to be the best, said Ronald G. Ehrenberg, director of the Cornell Higher Education Research Institute in Ithaca.

"We want to have the best faculty. We want to have the best fa-cilities. We want to give the most financial aid. We want to have the best students," he said. "All these things cost money."

He compares colleges to Cookie Monster, the Sesame Street character whose only goal in life is to find and eat cookies.

For colleges and universities, he said, that goal is to seek out all the resources to fund whatever will make them better.

That mentality is only fueled by published rankings, such as the kind put together annually by U.S. News & World Report, leading to an ever-upward spiral in spending, Ehrenberg said.

"There is sort of an academic arms race," Vedder said, "and it's not clear how much of that is improving instruction -- but it sure as heck is raising costs every year."

Average tuition increases have been outpacing the rate of inflation by 3.5 percent a year for the last three decades, Ehrenberg said.

As a result, tuition, fees and room and board at public colleges and universities have nearly tripled in the last 20 years to an average of $17,131, according to the College Board, a nonprofit that tracks college pricing.

Public institutions are relying more and more on tuition revenue, because of steep cuts in state funding, said Sandy Baum, an economist and senior policy analyst for the College Board.

"They get a significant portion of revenue from their state, and those funds have been declining as enrollment has been increasing," Baum said.

> 'Replacing the loss'

New York State, for example, cut hundreds of millions of dollars in funding to the State University of New York in recent years, which nudged Albany to incrementally raise SUNY tuition by 30 percent over five years.

"It's not that they're spending much more," Baum said. "They are replacing the loss of state revenues with tuition."

At private institutions, tuition, fees and room and board have doubled over the last two decades to an average of $38,589.

The Chronicle of Higher Education points out that the price tag is now more than $50,000 a year at 123 colleges and universities across the United States -- up from 58 schools two years ago.

Those elite institutions -- the ones with no shortage of applicants willing to pay -- are setting the pace for tuition hikes and providing "cover" for the rest of higher ed to do the same, said Ehrenberg, a former vice president for planning and budgeting at Cornell University.

Private schools are also raising tuition, partly so they can provide more financial aid for families who can't afford it, he said.

That's why the "net" price -- the cost after financial aid -- has gone up much slower than the "sticker" price, Baum said.

"I think there's going to be every effort made to slow price increases, but it doesn't mean prices are actually going to fall," Baum said. "If you slow the sticker price increase and do it by cutting financial aid, you might not help anyone."

> Student loan debt rises

Meanwhile, student debt is mounting.

Students are leaving college with an average of $25,000 in debt, according to the latest study by the Institute for College Access & Success. As a result, student loan debt ballooned to $1 trillion last year, surpassing for the first time the amount owed on credit cards in the United States.

It has made college tuition an election year issue for Obama, who wants colleges to control tuition or face losing federal dollars.

"You can't assume that you'll just jack up tuition every single year," Obama told colleges in January. "If you can't stop tuition from going up, then the funding you get from taxpayers each year will go down."

Vedder's organization, the Center for College Affordability and Productivity, came up with 25 ways to reduce college costs.

For example:

* Cut administrative staff. The amount of staffing on campus has soared over the years, he said, as have the salaries for top administrators.

* Outsource more services. Everything from campus dining and lodging to building maintenance and information technology might be done cheaper by specialists.

* Cut and streamline programs. Move more classes online. Eliminate excessive research. Increase teaching loads. Use campus facilities more efficiently.

"University buildings are notoriously underutilized," Vedder said. "Classrooms are empty four to five months a year. They're not heavily occupied on Fridays, Saturdays or Sundays. Instead of building more buildings, utilize the ones you have more efficiently."

> 'It's not so simple'

Colleges could reduce costs by as much as a quarter, Vedder said, with the savings used to lower tuition.

"But no one wants to do that except the parents, students and taxpayers," Vedder said. "The universities don't want to give up that income if they don't have to. If the government is willing to make those loans to kids, they say, 'Let's capture the money.' "

Colleges say they hear the discontent over tuition and have been trying to tighten their belts.

"Those schools that are really tuition-dependent have to run a very efficient operation, because they need all their resources going into the students," said Laura L. Anglin, president of the Commission on Independent Colleges and Universities in Albany.

"If you really look at the last five years, I think colleges have been working hard to keep the rate of growth down and find creative ways to keep tuition down," Anglin said.

Baum sees things changing, too, but not dramatically.

"There are surely things that could happen that would make it cheaper to produce a college education, but it's not so simple," Baum argued. "A lot of cost-cutting reduces quality."

Ehrenberg foresees more institutions sharing faculty or programs to hold down costs.

But he also sees a growing disparity between the haves and have-nots.

"A small number of private, wealthy institutions will continue doing things the same way as in the past," Ehrenberg said, "but for most institutions, the financial model just won't work anymore."

email: jrey@buffnews.com