A very few years from now, a new surge of enrollments will reach California's colleges and universities, a surge that will not plateau until the second decade of the next century. These potential college students-some 488,000 more by 2005-are not a problem; they are an opportunity. What is a problem is that California may not be able to take advantage of the opportunity because the high costs of education will collide with increasing pressures on the revenues available to pay for them. This problem is compounded by policy drift-the failure to recognize that an essentially fiscal challenge has critical educational dimensions involving both access and quality. Addressing it is vital to the state's future. Failure to resolve this policy issue will lead to either of two equally unsatisfactory consequences: If access is maintained, coming generations of students will be shoehorned into crowded classroom and laboratories to contain costs; as a result, the quality of their education will suffer. Alternatively, if quality-as defined by high cost-is maintained, eligible applicants will be denied admission, and as a result, access will suffer. Resolving the public policy issue requires recognizing that California's commitment to college opportunity emphasizes both access and quality.
The state cannot afford to ignore the public policy issues raised by the coming enrollment demand. California's colleges and universities are not ivory towers isolated from the state's economic and civic life. It is not just that the University of California is a magnet for the nation's most talented individuals. The California State University prepares thousands of managers and high-level specialists who play a vital role in the state's economy, to say nothing of training over 12,000 public school teachers annually. California's Community Colleges are the broad foundation for the entire higher education system, and they are integral to the economy and culture of the regions they serve. California's independent colleges and universities offer a broad range of undergraduate opportunities and award more than half of California's advanced degrees. The problems of the next decade will not just happen within the cozy confines of campus boundaries. Unless addressed now, they will inflict irreparable damage to all Californians and to the state itself.
Tidal Wave II: 488,000 More Potential Students in 2005
Predicting student enrollments is a hazardous task. Predictions require assumptions about the future, some of which are necessarily subjective and often unstated. Nevertheless, as Figure One shows, demographers in California are in substantial agreement about enrollment increases over the next decade. Figure Two represents the projection that most nearly meets the Center's explicit assumption of continuing commitment to broad access in California.2
Three critical assumptions undergird these enrollment projections:
These projections are not abstractions; the Californians who will seek college admission are now actually in school, and Figure Three shows the sharp increases in high school graduates expected during the next decade. As the enrollment projections show, about 488,000 new students must be accommodated on campus under historical policies-or a new policy of denying them opportunity must be created and justified. No one has come forward with such a new policy, although policy drift and inattention could achieve similar and unhappy results.
The next few years-the calm at the eye of the storm-are critical. Although enrollment pressures will have their major impact in the first decade of the next century, these pressures will intensify in the late 1990s. From 1999 to 2000, for example, head-count enrollment in the community colleges is expected to increase by some 72,000 students. In short, the state does not have time to waste. The next five years must be used to plan and phase in essential changes in educational practices and priorities. The need for action is urgent.
The Additional Cost of Tidal Wave II
The expenditures required over the next ten years to accommodate the 488,000 new students would be about $5.2 billion in new programs and buildings under the "business-as-usual approach." This estimated cost is only for the additional state costs of educating the additional undergraduates. Although it does provide for repair, maintenance, and renovation of buildings, it does not include the operational costs of continuing current enrollment levels, which is currently at $6.5 billion for 1995-96.3 The additional dollars, based on estimated current state costs of educating undergraduate students, will be required if existing educational practices continue and the proportion of these new students enrolled in all three public higher education segments roughly parallels existing student distributions.
Constrained and Finite State Resources
Belief that $5.2 billion for programs and buildings will be available over the next ten years if current fiscal and educational practices continue requires optimistic-indeed, unrealistic-assumptions about state revenue growth or higher education's share of these revenues or both.4 At the national level, Robert H. Atwell, President of the American Council on Education warns that higher education should not expect to increase its current share of state or federal funding until sometime beyond the year 2010.5 California is not an exception to this view. RAND recently concluded that if current trends continue until 2005, over 300,000 potential students will be denied higher education because state support will decline.6
California is unique, however, in having more to lose than other states. Its commitment to broad college opportunity has benefited generations of Californians, and it has drawn thousands of talented individuals from other states and nations. California's higher education system has been the foundation of the state's economy-a national, as well as a state, asset. But the reality is that California is at risk because it will not be able to continue supporting its colleges and universities at historical levels.
California is recovering from the recession of the early 1990s, and support for higher education has increased over two good budget years. These years, however, are poor predictors of prospects for continuing support at business-as-usual levels. Rather, they are the deceptive calm at the eye of the hurricane. The students who will comprise Tidal Wave II are even now working their way through the public schools. At the same time, the legitimate, budgetary needs of other social services-the public schools, corrections, and health and welfare-will continue to grow. According to one doomsday prediction, they will grow to the extent that, "There will be no money left for higher education-or any other governmental function."7 One need not accept this prediction, however, to realize that it is highly improbable that the state will be able to nearly double its expenditures for higher education-the cost of continuing to operate on traditional, business-as-usual premises over the next ten years.
The Policy Vacuum in California Higher Education
The predictions of enrollment demand over ten years-of its costs and of the capacity of the state to pay these costs-are ventures into an uncertain future. But no matter how subject to their practitioners' varying assumptions and values, demography and economics are sciences. Public policy analysis, however, is not a science. Whether particular policies-or their lack-serve the public interest is always a matter of opinion.
The very success of higher education in California contributes to the crisis, for it has created expectations for a future as rosy as the past, a future that includes: easy governmental acceptance of academic and professional interests as surrogates of the public interest; courses scheduled for the convenience of faculty and students, rather than for cost-effective use of facilities and of faculty and student time; and generous state support with little in the way of substantive accountability for educational results asked in return from institutions, faculty, or students. None of these was "bad" in the context of California's past economic growth. But as expectations of a business-as-usual future, they create habits that are hard to alter and that inhibit necessary change.
In 1995, the Governor proposed, and the Legislature confirmed, a four-year plan to stabilize higher education budgets, and they are to be commended for it. But the plan is a short-term solution to repair the immediate damage caused by the recession. It does not address the long-term implications of business-as-usual costs, of dramatically increased enrollment demand, and of increasing constraints on state funds. The earlier response of state and higher education leaders to the recession was fragmented, and, insofar as the impending long-term crisis is concerned, this fragmentation continues. Long-range plans and policies are still lacking. There are no indications that decisions will be other than ad hoc and unrelated to statewide policy in the future.
A Summing up: Recommendations for Preserving College Opportunity
State policy leadership is needed to guide all three public segments of higher education in their preparations and planning for a future of more students and more constrained resources. Without such direction, the university, the state university, and the community colleges will pursue-probably should pursue-their separate interests. Such fragmented pursuit, however, has little likelihood of meeting public needs that do not match the interests of individual institutions.
What public policies should guide higher education? There are only three options:
The third option-which involves renewal of long-term, comprehensive policies that are supportive of historic public values-is the choice that the Center unhesitatingly recommends.
Recommendation I. The Governor and Legislature should assure to eligible and
motivated students access to colleges and universities of high quality at a price
they can afford.
However necessary the effort and laudable the goal, mere statement of public policy will be empty unless accompanied by concrete actions to implement it. Selecting appropriate actions will be not be easy. The actions must be economically feasible, they must be consistent with-and preferably enhance-educational quality, and they must be supported by the public. As an appropriate action that meets these conditions, the Center recommends a new social compact based on the concept of reciprocity, a compact for shared responsibility.
Recommendation II. The people of California, through their state officials,
should form a new social compact with colleges, universities, and students, under
which the benefits and burdens of maintaining college opportunity would be fairly
shared among all parties.
Because everyone in California shares the benefits of maintaining educational quality and access to it, everyone should share the responsibility for them-and be accountable for fulfilling that share. Shared responsibility is essential. The state must continue to invest in higher education, but it alone cannot foot the bill to meet this responsibility. Short of dramatic tax increases or a savage reduction in expenditures for other social services (each most unlikely in the Center's view), higher education will have to make do with a lower rate of increased support for each additional student than in the past. Nor is it reasonable to expect students and families alone to bear the burden. Beyond a threshold that may already have been reached, steeply raising tuition is not only politically problematic but counterproductive in its impact on access. Nor can colleges and universities alone resolve the problem. Institutions can only go so far in cutting costs before institutional quality begins to feel the razor's edge. An explicit commitment to shared responsibility, however, can maintain quality and preserve the benefits of higher education for all Californians.