Saturday, September 29, 2007

What's Happened to Our Public Law Schools

The University of California Board of Regents on Thursday, September 20 ratified a radical change in the purpose of public higher education in California. They approved such dramatic changes in tuition and fees for the professional schools that the state has essentially repudiated its 150 year old commitment to higher education for all residents. By raising tuition 52% at Boalt Hall to almost $41,000 for state residents, and a slightly lower 47% at UCLA to slightly under $40,000, the effect is to further accentuate the rise of the affluent student in today’s colleges and professional schools, and the decline of the economically disadvantaged and recent immigrants.

The nation has long supported public higher education, starting with the Northwest Ordinance of 1787, accelerated with the enactment in 1862 of the Morrill Act, creating the public land grant universities, of which the University of California is one. The GI Bill in 1944 paved the way for the children of the depression, of all races, ethnicities and income levels, to attend college. Even Harvard was initially founded in 1636 with a grant by the Massachusetts Bay Colony General Court.

The great public universities of the Midwest, followed by California, represented the rise of democracy, the prairie populism antipathy to the east, the opportunity for the waves on immigrants who settled America in the aftermath of the Civil, and opening the doors of higher education to all classes rather than a narrow, privileged class. Indeed, the University of California was founded in 1868, and in 1869 the Regents voted that the University would be open to coeds on an equal basis with males – a pioneering concept for the time. The public universities led the way in integration.

A social compact developed between the state and its citizens – a quality education would be offered to all qualified state residents at nominal tuition. Indeed, the University of California did not impose tuition until 1967, although campuses charged fees.

Public universities became the prime engine of upper mobility in America such that today 80% of all college and 60% of all graduate and professional students attend public universities and colleges.

Californians were proud in 1964 when Berkeley was rated the “best balanced distinguished university in America,” and thus the world. They are equally proud as the other UC’s, led by UCLA, have similarly risen to academic excellence.

And yet all these social gains are at risk because of a seismic shift in public finances from discretionary funding to mandates, led by Medi-Cal. California now spends more on Medi-Cal than it does on the UC’s, state colleges, and community colleges. Higher education is often the largest discretionary item in state budgets, and is most at risk when mandates expand. The national budget for Medicaid was only $1.9 billion in 1967. Medi-Cal, California’s version, is about $37.4 billion in the current year, compared to the state’s appropriation to the University of California of $3.27 billion.

Legislators have little flexibility, absent draconian budget cuts or astronomical tax increases. The cuts are passed on to university regents, presidents, chancellors, provosts, deans. At the same time, the fiscal pressures are compounded for the professional schools, especially business and law.

The Universities of Michigan and Virginia paved the way by privatizing these schools, demonstrating to the rest of the flagship public universities that these professional schools can successfully charge private tuition. In-state tuition at Michigan Law School this year is $38,760 with non-resident tuition an additional $3,000. Virginia’s resident tuition is $33,500 and non-residents pay $5,000 more Thus, universities in turn shift as much of the state budget cuts as they can onto the professional schools. For example, Virginia’s Law School receives zero funding from the state and Michigan only 2%. Both in turn pay the university large overheads fees, thereby further subsidizing the other academic programs.

The UC law schools started down this path half a decade ago. In-state tuition at Boalt was $5,000 in 1984. It rose to $20,669 by 2004, a 447% increase. It is now scheduled to double by 2010.

The two great public law schools of Michigan and Virginia are deceptive models for the UC’s because they possess two substantial assets lacked by all other public law schools: large endowments and generous alumni. Both have endowment of over $300 million. Michigan received $11 ½ million from its endowment last year. Virginia’s alumni give over $8 million to the annual fund and Michigan almost $4 million. These funds are in the dean’s discretion, and can be used to supplement faculty salaries, research and development expenses, scholarships, fellowships, grants, and student loans, and loan forgiveness for graduates entering public service.

The UC plan is to use the tuition revenues to achieve these aims, thereby relying in fact on a large pool of affluent students able to pay full tuition to subsidize a smaller number of less affluent. That is not the purpose, but it is the economic reality, as repeatedly shown by private universities. For example, Yale College has relied for decades upon roughly 60% of its students to pay full tuition to cover the discounted tuition of others.

Boalt’s endowment is estimated to be $80 million. UCLA has been very successful in fund raising, but all UC law schools have a long way to go to educate their alumni on the need to donate, both for endowments and in annual giving.

An additional caveat is that Michigan and Virginia have abandoned their historic favoritism for state residents. They are now truly national law schools. Michigan’s student body is 75% non-resident and only 25% resident. Virginia reserves only 40% of its entering class for Virginia residents.

In reducing access to state residents, Michigan and Virginia have the advantage that their states offer residents quality legal education at other public law schools in the state at substantial lower tuition. That will not be the case with the UC's.

The UC tuition increases will affect all law students in California. No longer will the private law schools be competitively restrained by the low tuition charged by their public rivals. Watch their tuitions rise substantially in lockstep with the 4, soon to be 5, UC’s.

The University of California faces the same dilemma of most public flagship universities: how to maintain its academic excellence when the legislature, driven by mandates, is no longer capable of maintaining its past support. It has chosen to privatize the professional schools. They will perforce become more elitist and national, as they essentially echo their private competitors, and lose the ethos of public universities.

Too many of our great public law schools have now become private law schools in all but name.

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