2014 Legislative Outcomes

The 108th General Assembly of Tennessee wrapped up its 2014 business last week despite significant controversy and tension over taxes, budgets, and education.  As in years past, the legislature produced just under 3,000 bills for consideration and an additional 2,499 resolutions.  Due to the sheer scope of the University of Tennessee System, over 600 bills were tracked with either direct or indirect impacts.

So, where does that leave us for 2014?  A summary of legislative outcomes, created for UT Advocates, is below.

final-legislative-outcomes2014

Tuition Freeze Bill Taken Off Notice in House Education Subcommittee

A bill seeking to freeze tuition at public two and four-year institutions of higher education was taken off notice in the House Education Subcommittee yesterday afternoon (HB2179 by Rep. Barrett Rich).  Taking a bill off notice means that it will no longer be heard in committee unless the sponsor of the bill re-calendars it.

The companion bill in the Senate, SB1683 by Sen. Dolores Gresham (R-Somerville), has not yet been calendared.

For more about the bill, an excerpt from one of our recent posts:

HB2179/SB1683 [would have] required colleges and universities to create a cohort-style tuition freeze program for in-state students that maintain a cumulative collegiate GPA of 3.0 or higher. The bill’s definition of tuition includes all fees that must be paid to attend an institution. As such, the bill encompasses not just tuition, but course fees, program service fees, student activity fees, registration fees, and matriculation fees. As drafted, there was no “end-date” to the proposed freeze program, meaning if passed as drafted, it would last for perpetuity or until repealed.

In general, cohort-style tuition freezes lead to exponential tuition increase growth from cohort-to-cohort. A simple (and hypothetical) example helps explain:

Say the cohort tuition freeze program goes into effect for entering freshman. During their tenure, if they meet the requirements of the bill, their tuition rate would be frozen.

The following year, rates for rising-sophomores would be frozen, so the institution—to be able to account for lost revenues, increased fixed costs, and operational needs—must significantly raise the tuition rate for the new class of incoming freshman. Instead of the increases being spread across two cohorts, they are spread across one. The effect continues from year-to-year, leading to large increases from cohort-to-cohort.

For a number of years, legislators have been concerned about the perceived “rising cost of higher education.”

It isn’t so much that the cost of higher education has risen, but rather that the party “footing the bill” has changed. As state funding for higher education has declined over the past ten years, students have picked up more and more of the cost burden. In reality, the cost of higher education has remained relatively stable.

The Truth About Tuition Discounts & Waivers

Three bills granting tuition discounts and waivers for various groups passed in the House Education Committee this morning.  Most of these bills will now go for hearings in the House Finance, Ways, and Means Committee.

While well intentioned, tuition discounts and waivers have the effect of unfunded mandates on public colleges and universities.  Since no state funding is typically provided to accommodate the proposed discounts and/or waivers, costs must be recouped through the institution’s tuition rate.  This ultimately places a larger tuition burden on the institution’s student population.

The bills that passed in the House Education Committee today include:

SB543/HB283: Allows the children of retired teachers’ who are under 24 years of age to receive a 25% discount at any state-operated institution of higher learning; provided, that the parent retired with 30 years of full-time creditable service in Tennessee public schools or received disability retirement after a minimum of 25 years of full-time creditable service in Tennessee public schools.

SB402/HB305: Allows children of the director of schools of any LEA in Tennessee to receive a 25 percent discount on tuition to any institution of higher learning.

SB1164/HB887: Permits retired state employees to take one class without charge per semester at public institutions of higher education. Allows a spouse of a state employee to receive a 25% discount on tuition at public institutions of higher education.

Updates will continue to be provided as these bills move through the legislative process.