Higher Education Debt Levels are Concerning
It’s well-established that college tuition in Texas is growing by leaps-and-bounds. In fact, Dr. Thomas Lindsay recently noted that tuition has grown more than 440% in the last 25 years. But while skyrocketing tuition is a well-known phenomenon, many aren’t aware of just how fast higher education debt has been growing—something the Texas Comptroller is seeking to change with a stunning new report on higher education debt in Texas.
According to the Comptroller’s new report, Your Money and Education Debt:
- Four-year universities and colleges held $12.5 billion of outstanding debt as of fiscal year 2011.
- On a per student basis, debt outstanding totaled $20,519.
- Between 2001 and 2011, college and university debt had grown by 246.5 percent—nine times faster than inflation, almost eight times faster than enrollment, and nearly double the rate of growth in average tuition and fees.
- While most of the debts (61 percent) are issued under self-supporting institutional revenue bonds, the state does pitch in, close to $300 million dollars, to reimburse debt service for Tuition Revenue Bond, representing about one fifth of outstanding debt.
On the community college front:
- Outstanding debt for community colleges has increased 297 percent between fiscal 2001 and 2011.
- Debt service alone for community colleges is estimated at $394 million.
As this report clearly shows, institutions of higher education in Texas have an immense appetite for debt—one that we, as taxpayers, simply cannot afford to keep up with. If we, as taxpayers, don’t wish to see equally massive tax hikes in the future to pay for this spending binge, then it is critical that the Legislature take steps soon to rein in the growth in higher education debt.