Monday, July 7, 2008

Some Research University Budgets

Following up on my article proposing a meme about College Finances, I thought I would post a comparison table of the main budget contributions for four state-supported major "research intensive" (R1) research universities.

Since I am using publicly available resources which do not all contain breakdowns of such details as the division of teaching resources between faculty, support, etc, I will only present the basic income picture here. In retrospect, this is probably good enough because the amount of research money that sneaks into the regular budget in the form of "overhead" (operational expenses beyond those required to meet the retirement, health, and other fringe benefits that go along with paying a salary) is fairly similar for the places that post the relevant information.

Background information:

These four institutions are listed based on the national ranking of their physics departments. Why? Because I have that information. Three are in the top quartile and all are in the top 1/3 of "R1" departments. This top 1/3 is responsible for producing about 2/3 of all physics PhD degrees (see one my jobs articles for the table and references), which makes them, as a group, fairly typical of where you might have earned your PhD degree. School A is in the top 10 for physics, producing over 30 PhDs per year during the period circa 1990 covered by the National Academy study - about as many as the other three combined.

Some of these schools have a major medical school with a teaching hospital, while others do not. This would mess up comparisons of normalized budgets, so the tables below do not include any of the "auxillary" income and expense associated with running dormitories, a hospital, athletics, or (in the case of the two original Land Grant schools included in the list) their "extension" programs. In one case, the hospital budget alone is bigger than the entire budget for the rest of the university (teaching and research combined)!

Side remark: The smallest athletic department budget at one of these schools is 50 million dollars. That sure puts the budget of a small university or large community college into perspective.


By the way, only two of these schools are anywhere close to 'only' a billion dollar budget even if you look only at their teaching and research budgets. However, after normalizing them all to 1000 million dollars, there are a lot of similarities. For example, research money tends to dwarf the other components of the budget. Research pays for a lot of what you see at these universities, which is why research plays such a huge role in getting tenure.


By the way, the one with the smallest fraction for research is mainly a result of a really high number of tuition-paying students at its main and branch campuses. It actually has more research dollars than C or even A. Further, don't assume those research amounts are exclusively federal dollars. Private (industrial) research, and special state projects, are significant at these universities.

In general, you cannot assume that the sum of State appropriations and Tuition and fees equals the cost of instruction. A significant chunk of that money is devoted to the non-teaching part of the teaching - research - service triad. (Some of these universities actually try to break that out in their budget numbers, but even that is difficult to take seriously because much of graduate education is, in fact, research.) Further, part of the money that comes is as "research" from contracts and grants will go out as general fund money to support the "overhead" (offices, libraries, computing, networks) supplied by the university without a direct charge to each research grant.

One of the things you find on every one of these institutions budget web site is a discussion of the on-going shift of resources from the state to the student. Since, in my judgement, schools A, B, and D would be considered the "flaghship" universities in their respective states, it is interesting to take a rough look at how their states treat them. I'll simply look at the ratio of state support to the sum of state and tuition, keeping in mind that subsidies from the research side that get used for the teaching mission of the university - and the part of a professor's research time that is supported by tuition - muddles this analysis.


This result, however, is not far from what the respective universities report. (One of them includes the "indirect cost recovery" - overhead - number in the total, which has the effect of reducing the fraction supplied by the state - and the students - by a significant amount. That university, B, gets an amount equal to about half of its state budget from 'overhead' on all of its research operations! Guess how important research is for tenure at that school? Right.)

There is also a curious anomaly: The fraction of state support for C is higher than B even though B is a flagship university. The reason appears to be that B has many more out-of-state and graduate students, thus getting a LOT more money from tuition but less in the form of appropriations tied to in-state enrollment numbers.

References Added:

A study reported by IHE back in May compares direct instructional costs to "other" institutional costs for student services and non-instructional costs (mostly research funds) across a range of institutions. I can't tell if they included "auxiliary" operations such as dorms, athletics, and hospitals in their study, but it doesn't seem that they did. That means they give some insight into where the combination of state funds and tuition gets spent, which is mostly not in the classroom. You can also see that in the budget details for my CC just by looking at the salaries: 3.9 million to teachers and 3.8 million to administrators and other staff.

Note added:
See also my article "Inflated Inflation" documenting the change over the last 4 decades of state funding for education at an R1 and the spending by the R1, showing that tuition increases are not replacing lost state dollars in at least one instance that I know of.


Anonymous said...

"By the way, the one with the smallest fraction for research is mainly a result of a really high number of tuition-paying students at its main and branch campuses."

I wonder if this is really a useful lumping. If this were, say, the University of Texas, then doing this would provide a badly distorted representation of its budget. Brownsville, Pan Am, Tyler, etc -- those aren't branch campuses, they're separate universities under a common governance superstructure. The legislature has heavily skewed the portion of the state's educational dollars allotted to the UT System towards staying in Austin, but UT can't touch UTEP's budget, and UTEP has no access to UT-Tyler's money, and so on. A horrible but illustrative analogy would be the relation of the UN to its members, or perhaps the relation of the states to the federal government if the relationship was shifted a bit more towards the states in terms of power balance.

I'm not sure if the same holds in other states, but it seems like it must in California at least.

Doctor Pion said...

In this case, it is really hard to find the details needed to separate the budgets because they actually are branch campuses of a single institution with a single budget. For example, it is entirely possible that profits from the branch campuses support research at the main one.

One of the others also has an embedded branch campus in its data, but that is much smaller. A third has branch campuses that, like the UT system, are budgeted as separate entities and were not included in the analysis.

If I can find the detailed budgets for that institution, I'll update that info. I agree, I was stunned at the data I saw for that university.

Doctor Pion said...

It is definitely a necessary lumping.

Having looked at the actual state appropriation bill, I can now tell you that there is only a single line item for the part of the university described here. There is no way to separate the state appropriation into parts that apply to specific branches of the university.

The Uni budget tells you how much each campus spends, but it all comes from the same pile of money. Worse, some functions are provided centrally because some of the campuses aren't even separate colleges. Further, research is done by faculty on some of the branch campuses (I know one of them) and that money is not broken out separately either.

Even tuition funds are comingled, although enrollment counts allow one to discern the following: Slightly more than half of the students are on the main campus, but they pay about 2/3 of the tuition due to (1) 20% higher in-state rates and (2) a significant fraction of out of state students.

PS - I know quite well how the UT and UC (and CSU) systems work. This is nothing at all like those.

Anonymous said...

That's unfortunate from the data mining perspective. I would suspect though that it's fabulous for hiding all sorts of things in a budget :-)

Doctor Pion said...

Also posted in the "Inflated Inflation" thread ...

An article in Rate Your Students titled How Much Does Society Pay for Susie Slacker made the assertion that students only pay 10% of their share of the college budget at the authors "small state university" in Florida.

This claim is as unbelievable as it sounds on first read.

I looked at three small state universities in Florida (North Florida, West Florida, and Gulf Coast) and none of them have a budget where tuition is less than about 25% to 30% of the instructional part of the budget, which is the way I did my analysis.

You can't include ancillary operations like dormitories, athletics, or a book store in the budget when talking about state funds or tuition, since they are all handled separately.

Nonetheless, these three small 4-year (plus masters, it looks like) institutions do get most of their funds from the state, spectacularly more than the R1 universities shown here. They even get more than my CC does. I need to take a look at those also or compare one of them to a directional state university in another state.