VUU: Canary in the Higher Ed Coal Mine?

Virginia Union is known for its fine collection of African and African-American art.

by James A. Bacon

Virginia Union University (VUU), a historically black university tracing its founding to the end of the Civil War, has been publicly sanctioned by its accrediting agency for non-compliance with financial and financial-aid standards. The Southern Association of Colleges and Schools’ Commission on Colleges (SACS), cited deficiencies in control over financial resources and funded/sponsored research and programs, reports the Times-Dispatch.

The news follows an SACS decision to terminate accreditation for Saint Paul’s College, a historically black college based in Lawrenceville.

Here’s the big question: Are these troubles merely anecdotal or do they indicate broader woes faced by traditional colleges and universities in the face of runaway tuition and increasing competition from non-traditional enterprises?

One could argue that these citations reflect mainly the woes of historically black colleges and universities (HBCUs), which were founded to educate African-Americans during decades of rigid segregation in Virginia and throughout the South. As long as they enjoyed a captive market, so to speak, these institutions survived. But when segregation ended, they had to compete with larger, better-funded and more prestigious public and private universities for a finite pool of black college-bound students. Thus, according to this line of logic, the problems of HBCUs are unique to HBCUs, not to higher education generally.

I would argue that, as the most vulnerable institutions, HBCUs are simply the first to experience the mounting consumer backlash against rising prices. They cater to a demographic that is lower-income on average and more dependent upon financial aid than the population as a whole. Accordingly, they have less pricing power — ability to raise tuition and fees — than other institutions at at time that students and their families are rebelling against the unaffordable cost of a college degree.

The State Council for Higher Education in Virginia (SCHEV) compares tuition, fees, room and board for public colleges. Virginia Union is a private college, so it is not included in the comparison. However, Virginia’s two public HBCUs — Virginia State University (VSU) and Norfolk State University (NSU) — are included. And it turns out that they charge the lowest tuitions in the state, save at Radford University and two-year Richard Bland College.

Virginia’s flagship institution, the University of Virginia, charged $20,600 in 2011-12, according to SCHEV’s “2011-12 Full-Time Resident Undergraduate Student Charges.” Moving down the scale, Virginia Commonwealth University charged $18,200. By contrast, VSU charged $16,000 and NSU only $14,600. Of course, those institutions also benefited from state support amounting to $8,400 per student in 2008-2009.

Richmond-based Virginia Union charged $22,200 for the 2011-2102 year. As a sign of the institution’s lack of pricing power, VUU is keeping charges flat in 2012-2013.  Read the strategic plan and see how much the administration is focused on cost control, from curtailing health-care and energy expenditures to engaging in bulk purchasing and establishing tighter audit controls.

Here’s what I would predict for the next few years: While the most prestigious colleges and universities may have the pricing power to continue raising tuition and fees, though at a more restrained rate than in the past, less prestigious institutions will not — especially those that cater to a lower-income market. The financial vice will continue to tighten. As these institutions struggle, accrediting agencies will sanction them more and more.

The age of austerity — it’s an ugly, painful thing. But it often takes pain to drive transformative change.

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  1. Peter Galuszka Avatar
    Peter Galuszka

    Depends on the HBCU. Top ones like Spelman, Howard and Morehouse have the usual college struggles but do well and hire good faculty and managers. Howard has a not bad endowment.
    The problem is that as African Americans gain entrance to mainstream schools that were off limits years ago, the smaller HBCUs are starved for money and students. Stronger schools that have good programs or grad schools do well by anyone’s estimate do well.
    The issue of HBCUs’ future isn’t a new dilemma, especially within that particular community.

    1. Peter, I suspect you’re right, the top HBCUs — including Hampton University here in Virginia — will remain competitive in the higher ed marketplace of the 21st century. As society becomes increasingly color blind, I would not be surprised if they shed their “black” identity and became more integrated as well. I fear for the future of the less prestigious HBCUs… just as I fear for the future of less prestigious institutions of all colorations.

  2. […] with financial and financial-aid standards. The [Historically black colleges and universities] they have less pricing power — ability to raise tuition and fees — than other institutions at at time that students and […]

  3. goweatherford Avatar

    Interesting points, as always. But to simply claim that tuition is has grown too high without examining the root cause for that increase is to miss much of the point.

    Over the past decade, the state has, year by year, decreased the financial support that underwrites the education of its citizens. I’ll use VCU as an example, since I have lots of ties to it. In 2001, the state covered more than half the tuition cost of every VCU student. By 2010, the state had cut its support to VCU by $12 million, even as more many more students enrolled there to pursue their careers. As a result of these two factors, the percentage of state underwriting for every undergrad’s tuition dropped to 14 percent. I’m sure it’s lower now.

    Obviously, those costs have been shifted to the students and their families, who usually take on loans and other debt. If you haven’t noticed, this is a bad time to be adding debt, but what choice do these families have? A bachelor’s degree is now a basic requirement for any but unskilled jobs.

    One more thought — to adequately compare costs across state universities, you should tally total tuition plus a variety of mandatory fees. If you do, you see VMI at the top ($26,368 per year), followed by, in order: William & Mary ($26,264), UVa ($23,152), Longwood ($21,060), Tech ($21,018), Christopher Newport ($20,168), and then VCU right at the median ($19,134). At the low end is Norfolk State, with $13,380.

    When you take into consideration all that’s involved, perhaps the issue is that VUU is charging UVa rates without providing its students the benefit of going to UVa.

    1. Goweatherford, declining state financial support explains some of the increase in public university tuitions but it can’t account for the increase at private institutions. … I’d be interested to know where you got your numbers for tuition plus mandatory fees. Was that the SCHEV website? I thought that I was providing total costs in my blog post, but perhaps I was looking at a different data set.

  4. goweatherford Avatar

    Here’s a useful table: . I was part of a group that put the figures online, and I can confirm that they all came from and were vouched for by SCHEV.

    It’s pretty clear why state and private institutions both have increased their rates: Because now in both cases the students are bearing the brunt of increased costs. Used to be that students at state universities had help covering them; now they don’t.

    As for why college costs so much at all, there are a zillion reasons, every one of them a topic for debate. Should universities have staffs as large as they do? Should they all offer such a range of classes and majors? How about technology expenses? And entertainment and fitness options? Etc.

    On that last point, this just ran on Marketplace. Thought you might be interested.

  5. larryg Avatar

    re: ” Used to be that students at state universities had help covering them; now they don’t.

    As for why college costs so much at all, there are a zillion reasons, every one of them a topic for debate. ”

    yeah…but the debate should be BEFORE we pay not after.

    The colleges and Universities have abused the state taxpayers AND students and the solution seems to be shut and pay more.

    There is no excuse for the well-above-inflation increases of most colleges and Universities and my suspect are that if the Feds make loans harder to get, the colleges would be looking at lower enrollments and a downward spiral if they tried to increase prices t make us enrollment decreases.

    The Feds are doing the same thing with college loans that they did with mortgages and the result is going to be the same.

    and remember.. I’m the guy that DJ calls a “libtard”.

    back in the day… folks would have full time jobs and go to “night school”. Many well-known lawyers and other professionals got their education that way. Others worked their way through school … taking only the courses they could afford from their jobs.

    At some point, we went off the rails and started to believe that borrowing money for college was better than actually paying for it as we went.

    Some folks have the money to go 4 years full-boat, all expenses paid – good for them. But for us who don’t have that kind of money, it’s beyond me how we rationalize our way to 30K or more worth of debt because we even begin a career. It’s nutty. It’s okay for a doctor to do that. He/she is going to have a guaranteed income but how much sense does it make to go 30K into debt for a degree for which there is no demand in the marketplace?

    It’s like they were giving out stupid pills and there was a stampede to make sure you got enough.

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