Donna Carney

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Reflective Essay
The Revenue in Public Higher Education by Charlotte Tate discussed the economic
pressures being faced by institutions of higher education. The author asked the
question about how do we as institutions with large numbers of programs and
majors survive the economic downturn. Revenues and resources must be
maximized. Tuition increases and the use of hybrid courses were discussed as ways
of maximizing revenue as well as not setting tuition prices. Elimination of programs
was also discussed. It may be costlier to cut unneeded programs to only have to
add them back at a later date. If the program was added back later, the institution
could face start-up costs once again. I agreed with the points discussed by the
author. This article is very relative to what is happening now at my institution. My
college may be faced with eliminating low-enrollment programs in the coming year
and the article was very helpful in making me realize how costly it may be to
eliminate a program. I believe there will be situations when programs will need to
be eliminated, but as the author stated we must look very closely at the programs
and weigh all the opportunity costs, advantages, and disadvantages before
eliminations are made.
The Revenue-to-Cost Spiral in Higher Education by Robert Martin addressed the
issues of how higher revenues add to increased costs of higher education
institutions. Comparisons were made with non-profit and for-profit organization and
institutions of higher education. Revenue of an organization must be sufficient to
cover the organizations costs. Reform in higher education is difficult because a
college usually spends all its available annual revenue without overspending. Costs
for colleges will tend to increase annually because of increases in revenue. Once an
institution receives a certain amount of revenue in one year, it will also be expected
in following years. Higher costs are used as explanations for increased revenue. A
solution suggested by the article is for better information reporting to the National
Center for Education Statistics (NCES). Capturing productivity measures will
enhance the control of costs. Pay for performance might be a solution for
controlling escalating costs in higher education. I felt the author made some very
relevant points that should be considered. I believe there could be other ways to
control costs such as reform in federal and state regulations. Perhaps colleges
should look more closely at their budgets by allowing outside auditors to review the
revenue and cost allocations. I think an independent review would be helpful,
because colleges boards of directors and deans may be only seeing what works
best for them. I believe we should allow revenue to be carried over from year to
year if it is not expended. However, I know the state government does not work
that way because if the funds are not spent they must be repaid to the state.
In the Summary and Analysis of President Obamas Education Budget Request
article, President Obamas funding request for education for fiscal year 2013 was
discussed. The amounts requested for all areas of education were included in this
article. The article states that President Obamas plan would collapse 38 existing

Donna Carney

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Reflective Essay
programs into 11 new programs which would be administered as competitive or
formula-based grants. Obama is also proposing to consolidate programs under the
Vocational Rehabilitation program. No cost savings will be evident in either of
these consolidations; instead, the consolidations will cost in excess of $ 459 million
dollars. I believe the article told the information fairly as stated in the Presidents
budget request. I dont agree with all the changes being requested in the budget. I
was expecting more money to be allocated to higher education institutions.
I think it will be very difficult for colleges to continue on as they have in the past
with decreases in funding. I believe all of the articles shows that institutions of
higher education need to devise plans to prepare for decreased federal funding.
Our institutions may have to eliminate programs and unfilled faculty and staff
positions. Salaries and benefits are a huge part of colleges budgets. The bad thing
is as one article stated, with increased class sizes and decreased funding, the
students will begin to suffer the impact of the financial crisis in higher education.
Until the economy has rebounded, I believe we will continue to see reallocations of
financial resources from our institutions of higher education to other social
programs.