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President Susan Martin's testimony before the Senate Education Committee regarding HB 4496

January 25, 2012

Good afternoon. I welcome this opportunity to offer testimony before the Senate Education Committee regarding HB 4496.

Context matters, so please allow me to begin by telling you two things about myself that are directly relevant to my testimony: I am an accountant, and I am a product – both educationally and professionally – of Michigan's public universities. 

I earned my bachelor's degree in public speaking from Central Michigan.  I earned an MBA and a PhD in accounting from Michigan State.  I worked for the Michigan Department of Treasury as an assistant auditor general, a deputy state treasurer, and the commissioner of revenue.  I taught accounting and served in leadership roles at both Grand Valley State University and U-M Dearborn, and now I am president of Eastern Michigan University.

I provide this background so you can know two things about me: First, I am passionate about public education.  Second, as an accountant, data matter to me.  When proposals for a new academic program or a building renovation come before me at Eastern Michigan University, I insist that my staff present me with a business case that is based on sound data.

If that business case doesn't exist, or the data do not support the plan, I reject the proposal and send them back to the drawing board.

That's what you need to do with HB 4496: Send it back to the drawing board.  This legislation lacks a business case, and the data confirm that this legislation will cost taxpayers and students more money, not less, and will take Michigan in the wrong direction -- toward duplication instead of collaboration. A better model exists for helping expand access to higher education, and I look forward to talking with you about it today.

The cost of HB 4496

Let's begin with the cost of this legislation.  There is no business case outlining how allowing community colleges that offer four-year degrees will produce more degrees in a cost effective manner for the taxpayers of Michigan.  

To be successful, four-year programs must recruit and retain a well-trained faculty, they must have state-of-the-art equipment, and they must be accredited.  These important investments cost money, and the community colleges have not provided you with any data about how much it would cost them to make these investments, how they would pay for it, and whether these investments would yield a desirable outcome.

You've heard the supporters of this legislation claim – without any supporting data – that community colleges can produce more degrees at a lower cost.

Here are the facts: The cost-per-degree at community colleges is already higher than at regional public universities. 

Let me say that again: It costs more money to produce a degree at a Michigan community college than it costs to produce a degree at a regional public university in Michigan, such as Eastern. 

Why is that true?  Community colleges have much lower rates of degree completion than public universities.

A report issued by the Delta Cost Project showed that, in 2008, the cost-per-degree at Michigan's two-year community colleges was $68,867, while the cost-per-degree at Michigan's regional public four-year universities, such as Eastern, was $57,019.  A one-page summary of these findings is included in my testimony packet.

This legislation will exacerbate – not mitigate – that gap.  Your own analysts at the Senate Fiscal Agency concluded that HB 4496 would “result in increased operational costs for community colleges that choose to offer baccalaureate degrees under the provisions of the bill.”  The House Fiscal Agency reached the same conclusion in 2010.

An article included in my packet that was published in the Jackson Citizen Patriot last summer entitled “Federal Government wants to know why costs are rising so much at Jackson Community College,” highlighted the misperception that community colleges are automatically better at controlling costs.  That problem will get worse if HB 4496 is passed.

Interestingly, the community colleges have their own studies confirming that if they offer four-year degrees, their costs will go up.  Have they shared those data with you?  For example, a report issued for the community colleges showed that, in the case of nursing, community colleges will need to spend at least $7,000 more for each new graduate to pay for the faculty, equipment, accreditation, and other expenses associated with establishing a four-year program. 

Another report issued for the community colleges confirmed that nursing program costs exceed their revenue, thus requiring a subsidy.

These are just some of the findings from the community colleges' own reports showing that HB 4496 will increase – not decrease – costs.  Excerpts from these reports – in the community colleges' own words, so to speak – are included in my testimony packet.

Moreover, community colleges have lower graduation and retention rates than Michigan's four-year public universities.  Even in Kalamazoo, home of the Kalamazoo Promise, new data show that 85 percent of Promise students who started at a four-year university have either earned degrees or are still in school. 

But two-thirds of the Promise students who graduated high school between 2006 and 2008 and started at a community college dropped out before earning degrees or certificates, and only 8 percent have earned degrees or certificates.  Copies of articles from the Detroit News and Kalamazoo Gazette are in my packet.  Compare the success rates: 85 percent at four-year universities, 8 percent at community colleges!

This problem is not unique to Michigan.  A recent article in the Los Angeles Times entitled, “Billions spent in U.S. on community college students who drop out,” describes a “nationwide trend of increasing community college enrollment and spending but declining completion rates.”

Community colleges already spend more per-degree, they have lower graduation rates, and the Senate Fiscal Agency, House Fiscal Agency, and the community colleges themselves have all said they'll need to spend even more money if they begin offering four-year degrees. 

Someone must pay these higher costs without any evidence of a return on investment.  Who will it be?  The students, who will pay even higher tuition?  Property owners, who will be asked by community colleges around the State to pay higher property taxes?  Or will the community colleges come to you asking for these funds?

Collaborate, not duplicate

In addition to the cost, this legislation should be rejected because it will result in a duplication of services at a time when the Governor has called on all levels of government – including education – to collaborate, not duplicate.  This legislation takes us in the opposite direction. 

We all share the goal of increasing the number of college graduates in Michigan.  Michigan's universities are accomplishing that goal by collaborating with community colleges to produce more degrees in a timely and cost effective manner.

Articulation agreements

One model for such collaboration is the many articulation agreements that exist between Michigan's public universities and community colleges.

Articulation agreements build strong partnerships between a state's community colleges and its four-year institutions. These agreements outline specific courses at the community college that will transfer to the university, thereby ensuring that students understand exactly which courses will transfer so they don't spend time or money taking courses at the community college that will not satisfy their bachelor's degree requirements.

EMU has over 100 such articulation agreements with community colleges that often accept 84 to 92 credits toward a four-year degree, and we continually seek to help students reach their goals by expanding these relationships.

The student newspaper at Washtenaw Community College published an article this month with the headline, “Institutions work together to make transferring easier.”  The article quotes students who praise the systems already in place to allow community college students to transfer their credits to universities, where they can complete their four-year degree.  These partnerships already exist, and they work.

I understand that there was testimony before this committee in December that articulation agreements do not exist between universities and community colleges for any of the five programs covered by HB 4496.  That is not true.  At Eastern Michigan University, for example, we have nursing articulation agreements with nine community colleges in Michigan: Henry Ford, Jackson, Macomb, Monroe, Mott, Oakland, Schoolcraft, Washtenaw, and Wayne.

Eastern also has articulation agreements with four community colleges for culinary arts students to earn a bachelor's degree in hotel/restaurant management: Henry Ford, Monroe, Schoolcraft, and Washtenaw.  Eastern has a longstanding articulation agreement with Schoolcraft College for a student with an Associate's degree in culinary arts to earn a Bachelor in Science in hotel and restaurant management at Eastern, where we accept 91 credits from Schoolcraft.  This agreement was started in 2003 and is currently being extended through 2014 (attached).

On-site programs at community colleges

Another highly productive model for collaboration is the practice of universities offering programs on-site at community colleges. For example, Eastern Michigan University offers an RN-to-BSN program at Jackson Community College.

Included in my packet is a map showing the various articulation agreements and on-site programs that Michigan's universities and community colleges currently operate around the State.

This collaborative relationship between the universities and community colleges works because it recognizes the strengths of each institution and avoids the costly duplication of programs that has hampered this State.

As I said before, I am an accountant, so I like data.  At Eastern Michigan, the data tell the story: Between 2006 and 2011, the number of students transferring to Eastern from community colleges has increased by 30% as students recognize the benefits of beginning their education at a community college and finishing their degree at an accredited public four-year university.  These transfer students perform well at Eastern, with a grade point average of 3.31.

Building on what works

This system works, and that's why we want to expand it.  The Presidents Council has tried to negotiate with the state's community colleges to increase such constructive collaboration and avoid the duplication that would result from this legislation.  We made a specific written proposal to address the concerns that appear to be driving this legislation.

In brief, our offer is this: All 15 public universities identified the specific universities that will offer each of the four new programs requested by community colleges on their campuses, in collaboration with the community colleges.  The fifth program covered by HB 4496, nursing, is of course already offered by many of our state's public universities.  A copy of our written proposal to the community colleges is included in my packet.

The community colleges flatly rejected our offer.  Why?  This isn't about meeting specific program needs.  It's about creating more four year universities with no analysis of costs or need.

Conclusion

For generations, the citizens of Michigan – my parents and grandparents – paid taxes to invest in a great public university system where they believed their children and grandchildren could get a great affordable education.

We have that.  We have a rich network of community colleges, private universities, and public universities.  They each serve a unique population and pursue a unique mission.  This is a tremendous asset to train our future work force and to attract business from around the world to invest and locate in Michigan.

Now let me ask you a question: Have you been given a business case to support this legislation?  Have the supporters provided you with data showing the number of degrees that will be produced, the costs of this legislation, how they will pay those costs, and whether those new expenses will produce the desired outcome?  What will be the cost per degree?  Eastern will withdraw our off-site RN to BSN programs like the one at Jackson Community College if this legislation passes.  What will be the net increase in nursing degrees in Michigan if other universities do the same?  Do you feel confident that you have all the information you need? 

The data I described today directly refute the claims made by the supporters of this bill.   

I urge you to send this bill back to the drawing board.  Give us one year to continue to work together, and to work with you, to tackle this issue and find a solution that is supported by the data and the needs of Michigan citizens, and which strengthens – not weakens – our higher education system.

Thank you for your time.

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