Tuition deregulation appears dead for now

Lawmakers to let universities raise fees while issue is studied

By Michele Kay
AMERICAN-STATESMAN STAFF
Wednesday, May 21, 2003

Although a House sponsor is holding out slim hope that it can be resuscitated, the ambitious plan to deregulate undergraduate tuition and let Texas universities set their own rates appeared dead Tuesday.

"It's gone," said Sen. Florence Shapiro, R-Plano, chairwoman of the Senate Education Committee. "There's no semblance of deregulation left."

The Senate panel passed House Bill 3015, allowing limited tuition deregulation for graduate programs but none for undergraduates. Even though the House had already diluted the measure, supporting deregulation for only one year, the Senate panel watered it down more, rejecting any tuition-setting freedom.

Instead of deregulating tuition, lawmakers have decided to study the issue. They also are poised to allow universities to increase tuition by as little as $8 and as much as $23 a credit-hour. The exact increase was left pending until the Legislature completes the state budget.

Rep. Geanie Morrison, R-Victoria, chairwoman of the House Higher Education Committee, said House Speaker Tom Craddick, R-Midland, plans to announce next week a select committee that will study higher education's facilities and finances.

"Universities will be able to show us how we are tying their hands and what they could do with flexibility," Morrison said.

Lawmakers said they would reconsider the issue in two years.

Larry Faulkner, president of the University of Texas, said he was not surprised by deregulation's demise.

"In the end, it would be better for the state to head in that (deregulation) direction," he said.

Faulkner said universities now account for differences between systems and campuses with a system of fees that are "very complex and confusing for parents and not ideal from a management standpoint."

But he said UT can live with the bill.

"We'll be able to manage for the biennium with this bill," Faulkner said.

The legislation is now headed for the full Senate with differences between the two chambers to be resolved in a conference committee.

Morrison, who wrote the deregulation proposal and fought to protect much of it on the House floor, said she hopes some vestiges of her ideas survive.

"I would like to see (deregulation) revived," Morrison said. "The one year of deregulation gave universities a goal to work toward."

Deregulating university tuition was first proposed last year by UT System Chancellor Mark Yudof.

Early in the legislative session, unshackling universities and letting them set their tuition looked like a viable option to offset cuts of as much as $1 billion in the two-year budget.

Craddick was among the state's leaders who supported the move. But lawmakers quickly developed cold feet about turning over their power to set tuition to boards of regents.

Sen. Royce West, D-Dallas, chairman of the Senate Higher Education subcommittee, said he wanted universities to prove they were meeting state goals of increasing enrollment by 500,000 by 2015 and were educating a growing number of minorities before giving them a freer rein.

"We're not getting the return we should be getting," West said. "We need to hold our universities accountable."

Shapiro said she backed away because there were too many unanswered questions that needed more investigation.

Students, largely from UT, testified at several legislative hearings, begging lawmakers to keep their tuition-setting prerogative.

They said regents were appointed and thus were not accountable to voters.

In addition to tuition increases, the bill calls for 20 percent of the revenue from undergraduate tuition increases and 15 percent of graduate tuition increases to be set aside. The House wants that money to be used for scholarships and grants; the Senate is proposing giving qualified students interest-free loans.

mkay@statesman.com; 445-3635