Brad Elliott: Look at tuition, education costs

How would I deal with a 2 percent shortfall to balance the budget at my company?

First of all, I would pull up my bootstraps and get ready to work. Two percent is minimal. In fact, in our industry, we deal with tough margins and unexpected changes at all times.

We work through them with a combination of cooperation, collaboration, brain power and making tough decisions. Two percent is a decision we easily sort through before our first cup of coffee.

I think about things in relation to my personal household. Let’s say my household makes $50,000 a year. One unexpected expense comes up that costs us $1,400. If I have a entire year to plan for that, or even three months, it is not hard for me to figure out how we will pay for it.

In the state of Kansas, our projected $279 million shortfall is minimal, compared to an operating budget of around $14 billion. That’s about 2 percent.

Let’s take a look at some areas I would focus on to balance the budget.

First of all, we have to focus on education. It is the largest percentage of the budget and one of the largest expenses in the state’s budget.

It costs approximately $6,000 to go to college at Fort Hays, Emporia, or Pittsburg State per year, and double that for KU, K-State and Wichita State. That is a bargain, especially for education of that caliber. We can afford to raise tuition, perhaps $1,000 per student, per year.

But it’s out-of-state tuition where we can make the biggest difference. Today, a student from outside of Kansas can go to Fort Hays State, K-State or KU for roughly the same price as many states charge for in-state tuition.

For an example we can look at Iowa. If we raised in-state and out-of-state tuition to Iowa’s numbers — comparable to the University of Iowa, Iowa State and Northern Iowa — that would give us around a $3,000 per student increase and raise in-state tuition by $1,500. This could be worth about $196 million per year and prioritizes Kansas students further.

The state of Kansas pays about $2 billion in support of universities. Did you know that equals $20,800 per student? The state pays double the expense of what an in-state student pays for an education at a state university.

Even more amazing, private universities in the state of Kansas are educating students for far less money than are state universities. All this points to the fact that we must do something to increase revenue and decrease funding from the state to our universities.

The state spends $13,000 annually to educate each student from K through 12. Private schools spend between $7,500 and $10,000 per student. We have to get better at educating our children. With that much revenue, we must find a way to do it better and for a lower cost.

As an example, the state did an audit on schools and school districts in 2010. The Eagle reported we would save from $50 million to $150 million each year simply by consolidating school districts in 2010; it is probably much greater today.

Why don’t we do this? As reference, we can consult the “Total Expenditures per Pupil, by FTE” by the Kansas State Department of Education, a white paper published in 2010.

With a shortfall in KPERS, I would require all state employees to contribute 5 percent of salary to a KPERS plan. This would infuse the plan with cash that is so dearly needed, perhaps as much as $625 million.

I would require this until the plan is fully funded. We would also look at raising the retirement age by three years and have a huge affect as Social Security has done.

My summary:

▪ Raise tuition at state universities.

▪ Consolidate school districts in the state; eliminate 32 to 38 of them.

▪ Have state workers contribute to their retirement packages at 5 percent of their wages.

Now, let’s get back to growing jobs, and have breakfast.

This story was originally published November 27, 2014 at 2:46 PM with the headline "Brad Elliott: Look at tuition, education costs."