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Placing Public Universities Under State Bureaucracy Is No Way to Go

September 10, 2010

Higher education governance has been in the news lately, driven by concerns about high tuition, affordability, and duplication of services.

Business Leaders for Michigan (BLM), a business trade group, has suggested that efficiencies can be gained by greater management cooperation between the state’s 15 public university campuses. The eight Booth Newspapers collectively published a story suggesting that university independence is in part to blame for today’s affordability crisis — that the universities have too many duplicate programs, and too little coordination.

The Grand Rapids Press went further, arguing for creation of a state government-run university coordinating system, headquartered in Lansing. And at the Capitol, our elected policy makers regularly voice concern about the price of attendance.

No one is more concerned about higher education than those of us who lead Michigan’s public universities. But in seeking solutions, we must take care not to do damage to our campuses, which are the envy of the nation.

For nearly 175 years, Michigan has used a competitive management model for its public universities. The flexibility that this model offers has served Michigan well.

It would be a mistake to change it. University autonomy, which limits the involvement of politicians and state government bureaucrats into the curriculum and business operations of our public universities, is part of our state constitution. This long-standing practice has allowed our 15 public universities to quickly respond to national, state, and regional needs and to serve students and communities, particularly businesses, in a nimble fashion. Michigan has benefited greatly from this approach. No state boasts such a diverse group of high-quality public universities, and enrollment in them is at an all-time high.

Setting up a “command and control” board in Lansing would replace competition and free-market forces with a slow and ponderous bureaucracy. Adding another layer of bureaucracy in Lansing will serve no one’s interests and will make higher education more, not less, expensive.

This is an odd position to take at a time when many call on government agencies to cut bureaucracy and adopt competitive business models. I have worked in “system” states and find that state coordinating boards stifle innovation, increase costs, and raise new barriers.

A recent editorial headline in The Grand Rapids Press (“We Must Lower Costs of Higher Education”) makes an important point, and I couldn’t agree more. But I must ask this question: whose costs? If we mean the cost to taxpayers, that goal has been accomplished. Taxpayers used to provide 75 percent of revenue needed to operate the universities; today, taxpayers provide 25 percent or less.

University appropriations have been cut by hundreds of millions of dollars. Tuition has become a user fee that replaces the money that used to come from taxpayers. This inconvenient truth remains: higher education in Michigan has changed from a low-tuition, low-financial-aid model to a high-tuition, high-financial-aid model. Our citizens had become accustomed to the former; now, they must get used to the latter.

Accordingly, nearly every campus has increased student financial aid in amounts that equal or exceed the increase in tuition. University presidents are committed to doing everything we can to keep college affordable, but the real cost driver on tuition remains the state’s decision to dramatically reduce taxpayer participation.

That fact does not relieve universities of our obligation to control operating costs, as BLM rightly notes. In fact, we are collaborating as never before.

We’ve joined together to purchase energy, develop a high-speed computer network, cooperate on program offerings, and implement a myriad of other cost-saving programs. We are leaders in developing less expensive insurance alternatives — a massive expense for every employer. The universities, decades ago, created our own self-insurance corporations for handling property, casualty, and employee health insurance.

On average, university health insurance costs 25 percent less per employee than the state spends to insure its workers. We have suggested that the State of Michigan consider our model for its own insurance reform, which would save taxpayers millions of dollars.

Universities do not carry on as though the economic hardship that has affected so many of our students and their families does not matter to us. My campus has frozen salaries, increased insurance co-pays, and cut our annual budgets in tandem with reductions in state appropriations. Every university campus in Michigan is saving money in these and other ways, thereby reducing the pressure to raise tuition. We can, and will, continue to look for savings wherever we can find them.

Flexibly managed universities offering high-quality, accessible, and affordable degrees will lead Michigan’s economic recovery and create the jobs of the 21st century that our citizens deserve, and permit the next generation of Michigan’s children to find work in this state that we love. Disrupting university governance at this critical time will, I fear, produce the opposite result.

Thomas J. Haas is president of Grand Valley State University. He was chairman of the Presidents Council, State Universities of Michigan, from 2008-2010.

September 9, 2010 · Filed under Extra Points Tags: , , ,

46 responses so far ↓

  • 1 Kim Patrick // Sep 10, 2010 at 9:35 am

    President Haas nailed it! Great article!

  • 2 Steve // Sep 10, 2010 at 9:41 am


  • 3 Mary // Sep 10, 2010 at 9:51 am


  • 4 R. Brown // Sep 10, 2010 at 9:54 am

    I find it remarkable that a group of alleged “business leaders”, represented by BLM, would wish to create yet another state bureaucratic monstrosity. So much for the believing in smaller government and letting the market place dictate. Mr. Hass is spot on with his analysis of this State’s institutions of higher learning. Their autonomy permits them to operate at greater levels of efficiency and requires them to be responsive to the needs of their customers……the students and their families. These are concepts foreign to state bureaucracies.
    BLM should be more concerned about existing state bureaucracies such at the Dept. of Community Health. An agency that after a recent State audit cannot account for 4.4 billion…yes that’s right..billion….dollars of expenditures and still has failed to follow recommendations made in previous audits as old as 7-years.
    If BLM is worried about waste and efficiency they best focus their attention to state bureaucracies such as DCH rather than our efficiently run state universities.
    Such ideas as put forth by BLM will be of little benefit to the taxpayers of this State!

  • 5 Sue Votsch // Sep 10, 2010 at 9:57 am

    It would seem to me that the voters should consider having those that run our state unversities replace those that are running our state government. I feel certain that Michigan would become Mighty Michigan again in a shockingly short period of time.

  • 6 S.Ishak // Sep 10, 2010 at 10:19 am

    The idea of fostering more cooperation among the 15 universities is great. Indeed there is much waste in copmeting programs and wasteful administrative structures. Universities cannot govern themselves immune from some supervision by taxpayers through the elcted officials. Self regulation has failed and government intervention has been a practice. So called governing boards are a joke. They are either political appointments by the governor or elected by a minority of voters. The stakes are high and resources are in short supply. Some close monitoring and coordination are needed. President Haas response is faulted.

  • 7 J. M'ski // Sep 10, 2010 at 11:36 am

    Captain…good direction from the bridge. Course is set, full speed ahead. The crew is behind you, standing by, ever ready…ski

  • 8 B. Newman // Sep 10, 2010 at 12:21 pm

    I greatly appreciate this very well written article!

  • 9 M. Holstege // Sep 10, 2010 at 12:55 pm

    What a wonderfully written article! GVSU is very lucky to have such an advocate as our President!

  • 10 Sheryl Baron // Sep 10, 2010 at 2:26 pm

    Grand Valley is so lucky to have President Haas ! I have nothing but good things to say about him! He really cares about the students at GVSU! He shows his appreciation for RAs by having them at his home for dinner! He has also expanded a program to juniors that was only for freshman. Once a junior reaches 90 credits they earn $1000 towards tuition their senior year! Way to go! This was a well written article! Go Lakers!

  • 11 Concerned Citizen // Sep 13, 2010 at 1:22 pm

    GVSU is fortunate to have President Haas at the helm. His article is informative and insightful. Perhaps it is time GVSU’s privatizes and avoids state intervention and bureaucracy altogether?
    Go “Grand Valley University”!

  • 12 S. Donlon // Oct 22, 2010 at 7:40 am

    As a senior at GVSU, I am proud to have T. Haas as our university president. This article is proof of his goal to keep school affordable for us students without sacrificing quality. Go Lakers!

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