Washington, D.C. -- Dr. George Waldner, President of York College, went to Washington, D.C. this week to testify before the U.S. Senate Health, Education, Labor, and Pensions Committee. His address focused on cost control as it pertains to college campuses. His speech follows:

Mr. Chairman, and Members of the Committee:

I am pleased to be here today to discuss with you an important issue in the field of higher education; namely, the relationship among quality, efficiency, and access. I feel qualified to speak on this subject because my institution has managed for many years to combine attention to quality with careful cost control and by doing so to become an outstanding value in higher education. We are an independent college. Tuition for this academic year is $8,000. The comprehensive package: tuition, fees, room, and board comes to $14,500 for the year. We are priced at about 60 percent of the charges levied by comparable independent colleges and at about the same price as state-related colleges and universities in Pennsylvania, which are subsidized over $4,500 per student. But value has two parts: price and quality. York College is in the top third of the U. S. News ranking of northern universities – a ranking based purely on program quality. We are in the directories titled The Best Middle Atlantic Colleges: 98 Great Schools to Consider as well as Barron’s Best Buys.  Jay Mathews of The Washington Post included York College in his list of “20 Undiscovered Gems” in his April, 2003, article in The Washington Post Magazine. York College, at $14,500, was number ten on the list of twenty. The number nine college charges $33,710; number eleven, $29,750.  York College, I believe, represents access to high quality at a price within the reach of most American families, when combined with Federal, state, and institutional aid programs.

Efficiency is not a dirty word at York College, but efficiency is viewed as a suspect concept in most of American higher education. Why is that the case? In the normal course of institutional life in academia, there is a constant and passionate focus on qualitative improvement. That is clearly desirable and highly consistent with the overall mission of higher education. What is much less prevalent, however, is a concomitant, vigorously advocated concern to attain educational quality in a highly cost-efficient way.There is an apparent tendency among members of the academy to believe that any effort to control or to reduce costs will necessarily take a more than proportionate toll in terms of program quality. In short, there is a denial of the concept of efficiency – the ability to produce a desired outcome with a minimum of expense and waste.  This attitude makes the championing of cost control on college campuses a lonely and unpopular crusade, the dreary business of deans and chief financial officers. It is important, however, for college communities as a whole to adopt a positive, pro-active approach to cost control, in order to preserve access to higher education opportunities for all qualified students. Federal and state financial aid and subsidies as well as institutional aid, though essential for student access, must receive more of a helping hand from those who are directly engaged in operating higher education institutions.

I was pleased to be a member in 1997-98 of the National Commission on the Cost of Higher Education. The Commission put forward as its first recommendation:

That academic institutions intensify their efforts to control costs and increase institutional productivity.

The Commission then went on to make a series of recommendations on how to implement its call for enhanced cost control.

The first implementing recommendation was:

Individual institutions, acting with technical support from appropriate higher education associations, should conduct efficiency self-reviews to identify cost-saving steps that are relevant to institutional mission and quality improvement.

Since 1998, good foundational steps have been accomplished to enable institutions of higher education to carry out in a meaningful way the Commission’s challenge.  In particular, the National Association of College and University Business Officers, acting as part of a consortium of national higher education organizations, has developed an approach to the analysis of college costs which is adaptable to the wide variety of higher education institutions.  The approach or model has been field-tested and is ready for wide-spread use.

My basic idea is that a “quality-efficiency task force” should be formed at each institution.  Its members should include faculty, administrators, students, trustees, parents, alumni, and business community leaders. The group should develop data on institutional costs in comparison with costs at peer institutions. The notion of “peer institutions” is crucial here, because it is simply not helpful to compare costs at dissimilar types of institutions.  Every college and university has a self-selected group of peer institutions that it uses for comparisons and benchmarking for salaries, admission standards, etc. The idea is to use the same peer group for its analysis of operating costs. Such an analysis should identify areas where a given institution underperforms its peers, that is, operates more expensively to produce a similar result. These areas should then be targeted for in-depth analysis for cost reduction opportunities.

It is necessary to add at this point that college communities usually focus on areas other than instruction when searching for cost savings. Again, the tendency is to assume, without investigation, that any attempt to enhance instructional productivity will have devastating effects on program quality. Yet, at most institutions, instruction is where most of the expenditures are.  It is thus where most of the cost savings are likely to be discovered.  Over the years, I have developed a “quality instruction efficiency index” (see attachment) for instruction that seeks to find the golden mean between excessive and insufficient expenditures in the delivery of instruction. The areas of focus are: 1) The Faculty-Student Ratio (FTE:FTE); 2) Semester Hours of Required Teaching per Academic Year; 3) Utilization of Part-Time Faculty; 4) Maximum Section Size; and 5) Minimum Section Size.  Only by careful analysis and control of these instructional features can most colleges and universities find substantial cost savings. The major savings are not to be found in pooled purchasing out-sourcing or inter-library loan, although these areas should be reviewed for savings, too.

Given the follow-up on the National Cost Commission’s recommendations accomplished since the last reauthorization, an appropriate role for the Federal government in the context of the current reauthorization would be to require colleges and universities to confirm that they are conducting such efficiency self-reviews and are developing action steps for attaining greater cost efficiency. The tools for this sort of exercise are in being; the public interest in cost control to preserve access is clear.

Colleges and universities must now move forward decisively with greater cost control efforts, or else face highly interventionist and probably counter-productive governmental measures in the not too distant future.