Maine-native Sierra Connell is attending her second semester at UVM. She’s at her “number one school.” She’s volunteering, playing flute in concert band, spending her nights going to music events and hanging out with friends.
Now, she’s leaving.
Before she could graduate high school, her father passed away and her mother became too injured to work. Without financial support, she had to take out $18,000 in student loans for her first year of school. Now she doesn’t want to graduate with $100,000 in debt, she said.
“I shouldn’t not be able to go because things happened to my family and I don’t have money,” Connell said. “It’s not like my family [is full of] drug addicts. There’s no reason why I shouldn’t be able to go to the school I want to go to.”
Former student Aiden Holwerda was a biochemistry major in his first year, who spent his weekends skiing with friends at Jay Peak and Stowe. Now he works at a brickyard and attends community college near his hometown, Wyckoff, New Jersey.
He said he was aware of the cost of going to UVM as an out-of-state student, but that he didn’t understand the magnitude of the situation until it was too late. In order to attend a second year, he would’ve had to take out a $30,000 loan.
“I ended up not feeling comfortable with it, so I ended up coming home, with hopes to find a cheaper way to get through school,” he said. “If [the money situation] worked out I would have been able to stay, however I’m home now and I’ve just got to make the most of my scenario.”
Out-of-state tuition at UVM is the fourth highest in the country. Contributing to the high tuition cost is a barely-known state law called the “40 percent rule.”
The law limits in-state tuition to 40 percent of out-of-state tuition. In other words, out-of-state tuition must be two and a half times more than in-state. The 40 percent rule is specific to UVM. Vermont was supposed to provide money to UVM to make up for the discount.
Over the 56 years that this rule has been in place, this has not happened. Now out-of-state students are paying for it.
In 2012, Gov. Peter Shumlin ordered the creation of an advisory report on the state’s relationship with UVM. The report gave 12 recommendations; one of these was to change the 40 percent rule.
A Vermont resident who is enrolled in the University as a full-time undergraduate student shall not pay tuition in an amount that exceeds 40 percent of the tuition charged to a nonresident student. The actual law: Vermont Act 16, Chapter 17, Subchapter 1, § 2282
“It is imperative that the 40 percent rule be modified or the future viability of the university is in jeopardy,” stated the report.
The advisory board could not identify another public college or university in the U.S. which had any similar rules.
Holwerda believes that the fact UVM has to charge out-of-state students two and a half times more to do this is “absurd.”
“I was aware of [the cost] but I didn’t know the magnitude of the situation until I was at school, and realized that it was an enormous sum of money,” he said.
The 40 percent rule caused out-of-state funding to make up the difference. This situation is “unsustainable,” according to Shumlin’s 2012 report.
A little under $21 million of the state’s money goes to the university to pay for this rule, according to UVM’s 2014 appropriation request. Looking at the number of in-state undergraduates attending UVM now, the state should be supplying over three times more, about $63 million.
Though recognizing “how small Vermont is,” the university wishes it could receive more funding, said Richard Cate, university vice president of finance and treasurer.
“I mean, the bottom line is tuition is higher because the amount of money we get from the state is less,” Cate said.
A law forgotten
When the state made the law, they put a “placeholder for a percentage,” without “debate or reflection on its meaning or its consequence,” President Tom Sullivan said.
“The history is that the 40 percent rule was literally not debated in the legislature when it went into effect in ,” Sullivan said.
Sullivan then went on to detail a legislative vanishing act — the part of the law noting the necessary state funding was cut out.
There was a second sentence after the law requiring the state to financially support the rule, he said.
“For some reason, the second sentence got taken out a year or two after, with virtually no one paying attention,” Sullivan said.
He likens the situation to driving a broken wheelbarrow: “We’re going down the road with both wheels on, and all of the sudden one is taken off…you need both pieces.”
Rep. Peter Fagan, vice chair of the House Appropriations Committee, has an idea of why Vermont lawmakers don’t know much about the rule.
“We’re not looking back at how did this evolve over time,” Fagan said. “We’re just looking to see what is the law as it’s currently depicted. Going back in time like that is something that I doubt very few people will do.”
Holwerda thinks reflection on its laws is something the government should do more.
“I think that the law should be constantly reviewed and geared towards the students rather than the state,” he said.
Rule or restriction?
The state sees the 40 percent rule as fantastic in its intention to make Vermont higher education affordable, said Alyson Richards, director of Special Projects and Intergovernmental Affairs for Gov. Shumlin’s office.
“We of course applaud and appreciate the fact that Vermont students should get discounts in their home institutions and UVM doesn’t necessarily, in our discussions with them, feel differently,” Richards said.
For President Sullivan, this is “not a complicated story”: as the years have passed and state appropriations have gone down, the rule has become more of a restriction for the university.
“You have the 40 percent rule, no dollars coming to us for new buildings and the lowest appropriation in the country. Those three [things] are huge restraints on us,” Sullivan said.
The lack of state funding has become a problem which has fallen on the shoulders of out-of-state student tuition. As UVM and Vermont State Colleges have gone on to erect new buildings, the cost of construction has been and will continue to be filled by tuition dollars, according to Shumlin’s 2012 report.
“The more support you get from the state, the less pressure you have to put on the tuition,” Sullivan said.
The 40 percent rule acts as a restriction by linking both in-state and out-of-state tuition together, said senior Aya AL-Namee, SGA president.
“You can only raise one to a certain point because you know how much that will affect the other one. That limits how competitive our schools are,” AL-Namee said.
To Clarence Davis, university state relations director, the state has not been as “heavily invested” in public higher education as other areas, but has a limited amount of funds it can give.
“I’d like to see more investment in higher education. The state has decided to spend the limited resources it has,” Davis said.
The state’s decline in funding for the University was not a decrease in actual dollars, but a failure to increase proportionate to the amount needed. From 1960 to 1980, the make-up of state funding in the school’s budget dropped from almost sixty percent to roughly half of that, and currently its 13.8 percent, according to data supplied by Cate.
“The amount hasn’t decreased,” he said. “It just hasn’t grown.”
Last year, Gov. Shumlin passed a bill mandating the Vermont PreK-16 Council to develop a plan to raise funding in UVM and Vermont State Colleges’ budgets. So far, the only proposal given was to increase appropriations by $1.3 million through taxing the possible sale of recreational marijuana and lottery funds. This plan was abandoned by the committee in early January, shortly after it was brought to the table.
The idea that UVM could accept funds from the sale of drugs in particular is “hypocrisy on its own,” AL-Namee said.
“Taxes off marijuana towards education is the biggest joke I’ve ever seen in my life,” she said.
Currently, Vermont is facing a $92 million budget gap. This is ultimately the main issue and priority at hand, said Rep. Mitzi Johnson, chair of the House Appropriations Committee.
“I mean – I went to UVM. I paid out-of-state tuition when I went [there]. I certainly understand the dilemma, and I know that UVM offers incredible opportunities for students, [but] my current job however is to pass a balanced budget,” Rep. Johnson said. “We’re taking all kinds of steps to figure out how to really measure results of our investments, what kind of returns are Vermonters getting on [them and] how well do various programs work.”
To repeal or not to repeal?
Connell, who is moving to New Hampshire with the goal of qualifying for in-state tuition for schools there next year, understands the rule and its purpose but feels “bad for the university.”
“I know that no one wants to charge people that much, and it’s unfortunate that these laws are in place and it doesn’t really make sense,” she said.
However, the opponents say that changing the rule would possibly do more harm than good. As Fagan said, one must be wary of the “unintended consequences” behind removing a rule that has been around for so long.
“Understand what you do before you do it. It might sound good, but once you begin getting into the [outcomes] it might not turn out to be quite such a good idea,” Fagan said.
For UVM, ditching the 40 percent rule’s restrictions is an asset and that it would help to be more competitive on price and affordability, Davis said.
“If the 40% rule is abolished, its one more tool in the toolbox for the administration,” he said.
Story by Jacob Holzman, Krista Cantrell and Sarah Olsen. Banner photo illustration by Luci Lobe.