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A recent report in the Chronicle of Higher Education lays bare a reality that is too often invisible to students, parents, and legislators: That colleges and universities spend radically different amounts on instruction.

According to the figures reported, Arizona State spends $7,830 on instruction for each of its 103,530 students. Southern New Hampshire, in contrast, spends $1,224 and Western Governors, $1,980. Put another way, Southern New Hampshire’s per student instructional spending is just 16 percent of ASU’s, and WGU’s just 25 percent.

Remember, this is spending on instruction, not athletics, information technology, research, development, or construction and maintenance. The figures “include wages and benefits to faculty and staff members who teach students at the institution, but they do not include costs that fall under the separate category of ‘academic support,’ like course development and academic administration.”

To be sure, the online providers may — or may not — spend large sums developing instructional materials. In the early days of MOOCs, UT Austin and Harvard spent as much as $100,000 per course to cover design and production costs, platform development, and creation of interactive, simulations, and other instructional tools. Online providers may also incur large expenses on the technical and support staff to manage and support their programs.

In practice, however, many of the lowest spenders trim instructional expenditures steeply by substituting adjuncts, coaches, and graders for full-time expert faculty, standardizing courses and assessments, narrowing the curriculum to a relatively small number of fields, and teaching fully or primarily online to a large numbers of students. These institutions also devote astonishing sums to advertising and recruitment.

But note: Not all the instructional savings pass on to students. At SNHU, a credit hour is $320. Tuition and fees for 15 credits at the University of Texas Rio Grande Valley cost $4,066.16, or $271 a credit hour. ASU’s cost per credit hour is higher – it charges in-state students $10,792 for the Fall and Spring semesters – but this turns out to be about $360 per credit hour for a full load of 30 credits.
What, then, are my takeaways?
  1. Despite significant differences in facilities, range of majors, student services, and, above all, access to professors, the gap in tuition and fees between the mega online providers and public urban and regional comprehensive universities is much less than one would expect. These mega providers are pricing what the market will bear — just as privates and some public universities do.
  2. At most traditional institutions, a full course load is a significantly better financial value than a part-time load, and at many institutions is comparable or even cheaper than the online providers’. In short, students should think long and hard about whether flexibility is worthwhile, especially as they will forgo many of the benefits of a residential educational experience.
  3. Those students who place a premium on convenience and flexibility and a job-focused curriculum do not, in general, receive the financial benefits one might expect from the mega online providers. Indeed, in many cases they pay a premium for a stripped down academic experience. 
I understand that there are many undergraduates — including many adult learners, family caregivers, and degree completers — who do not want a traditional college experience.
I also recognize that many graduate and professional students can learn effectively in online courses or in a self-paced, self-directed program of study, especially if they can save mind boggling amounts of money. For example, Boston University just launched a $24,000 online MBA, versus $120,000 residential.
One of the promises of the early online disruptors was that by avoiding “brick and mortar” costs, substantial savings would be passed on to students. That is happening, but only to a limited degree.
And the cost savings at the undergraduate level come at a huge cost. Students, for the most part, do not have regular and substantive interaction with a subject matter expert, or, in many instances, with classmates. They do not have access to face-to-face support, nor to a broad range of courses and programs and the co-curricular experiences that are often the most meaningful part of an undergraduate education.
The key point is this: Public urban and regional comprehensives offer extraordinary value for students’ dollars. Undergraduates should think local, look at traditional institutions near them, and do the math, as they might be surprised to find that a residential experience could not just be reasonable, but less expensive than a mega online university. Further, that experience might be better — and more aligned with what they actually need to succeed. 
No single statistic can measure the quality of a college education, but instructional spending is among the most useful figures we have. It offers crucial insights into an institution’s priorities. As the think tank Third Way puts this, institutions can spend their money to recruit students, to teach them, to provide support services that will help them succeed, to offer grants to incoming students to defray the cost of college, to compensate administrators and school leaders, or even to provide returns to shareholders (in the case of for-profit institutions).
A decade ago, Douglas A. Webber and Ronald G. Ehrenberg argued convincingly that the biggest budgetary factors influencing persistence and graduation rates, especially among students with lower test scores and family incomes, are spending on instruction and support services.
Recent reports from The Century Foundation and Third Way echo this message. The quality of higher education is inextricably linked to the actual dollars spent on instruction. After all, it’s this spending that supports the factors most closely crucial to students’ academic and post-graduation success: mentoring, faculty-student interaction, and high-quality feedback.
Reports like the Chronicle’s underscore the need for radical transparency. Students need to understand where their tuition dollars go and how an institution spends their money. Based upon that, college applicants might make better informed decisions, rather than be swayed by rankings, media, marketing, or even the so-called promise of anytime, anywhere learning. The gap is not simply monetary, but experiential.
If a student can find a way to go full time, be on campus and in a community of learners, and do so at a reasonable costs, we should do all that we can to make sure they seize this opportunity.
Steven Mintz, a Professor of history at the University of Texas at Austin, is also special advisor to the President of Hunter College for student success and strategic initiatives.

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