From staff and wire reports
Mississippi State University President Mark Keenum says there is reason for optimism amid decreased federal and state funding for Mississippi universities and an investigation into the Mississippi Prepaid Affordable College Tuition program’s financial solvency.
State Treasurer Lynn Fitch suspended MPACT on Tuesday for an audit she said will determine whether the program needs to be overhauled or eliminated. The program will continue for nearly 22,293 people already enrolled, she said, but new enrollment has stopped.
“We’re just taking a pause to determine the strength of the program ... where do we strengthen the program and where do we go from here,” Fitch said.
MPACT is only 76.8 percent funded and faces a $94 million shortfall, Fitch said. The program’s investment earnings last year were only 0.6 percent, she said, and actuaries said MPACT must earn 7.8 percent per year to remain solvent, assuming college tuition increases about 7 percent per year.
More than 20 states once had plans similar to MPACT, Fitch said, but many have either shut down or changed those programs, leaving Mississippi and Florida as the only states that fully finance their prepaid tuition programs. Keenum said MSU would not be unscathed if MPACT were removed, but MPACT is only part of the reason 76 percent of MSU’s 16,390 undergraduates are Mississippi residents.
“There are 1,015 MPACT students currently enrolled at MSU,” Keenum said. “Statistics show that 93 percent of Mississippi students stay in-state, compared with the national average of 81 percent, but their choice about which school to attend is much more complex than just consideration of the MPACT program. With no program such as MPACT, it is possible that some students might shift to less costly educational alternatives, such as community colleges.”
Keenum said a sluggish economy and low trust fund earnings are the key reasons for MPACT’s suspension. Undergraduates also face rising tuition costs, he said, because state funding has fallen nearly 15 percent in the past four years. He said he still believes MSU can reach its goal of enrolling 22,000 students by 2015.
“(We) have already embarked on an aggressive recruitment effort to reach the best and brightest students from across our state and our region,” Keenum said.
This year’s 3.7 percent decline in graduate enrollment at MSU is unrelated to the MPACT and undergraduate tuition issues, Keenum said, because while MPACT is a state program and tuition is a function of state funding, graduate enrollment is a function of federal funding for research and support of graduate students. Reduced federal grant money has reduced graduate admissions, he said, but MSU is using all its assets to keep its post-graduate research strong.
“Our Office of Research and Economic Development has worked hard to capitalize on the infrastructure we have in place to improve our competitiveness, and we have extensive contacts throughout the federal government,” Keenum said. “We are vigorously pursuing wide-ranging grant opportunities on the federal level, which includes increased grant submissions. Our faculty recruitment is paying off in improved NSF CAREER awards, as an example. These awards go to early-career faculty members who hold great promise as researchers.”