Wisconsin is 44th in the country for public funding of four-year universities — a drop from 43rd place in 2023, according to the State Higher Education Finance’s 2024 report.
In a press release, Universities of Wisconsin President Jay Rothman said the report is evidence of a desperate need for more state funding for universities. Gov. Tony Evers’ 2025-2027 biennial budget proposal — which includes $856 million for the UW system — would be enough to bring Wisconsin to the middle nationally in funding, Rothman said in the press release.
UW-Madison professor of economics and director of the Center for Research on the Wisconsin Economy Ananth Seshadri said he agrees with Rothman, though it seems unlikely the proposal will pass the State Legislature.
“I think President Rothman is exactly right that that’s the funding that will be needed to bring UW system to the median,” Seshadri said. “If you ask me politically, based on what I’ve at least seen in the press, it looks extremely unlikely that’s going to happen.”
Wisconsin’s drop from 43rd to 44th place is likely due to minor differences. But, it still represents that Wisconsin is underfunding its four-year universities relative to other states, Seshadri said.
Over the past decade, the State Legislature has passed smaller tuition increases than requested by the UW System Board of Regents, and, in some years, has frozen in-state tuition despite ongoing inflation, UW-Madison professor emeritus of public affairs and applied economics Andrew Reschovsky said in an email.
While these freezes increase the ratio of state funding relative to total higher education revenue, they also limit the overall amount of funding available to support higher education, Reschovsky said in the email.
With recent cuts in federal research grants to universities and the higher education budget cuts included in the current version of the U.S. House of Representatives budget bill, the UW System, and UW-Madison in particular, will face large spending cuts — making the role of state support for higher education even more important, Reschovsky said in the email.
Still, Seshadri said it is important to look at the report holistically and notice that Wisconsin’s rating does not account for differences in states’ wealth nor does it necessarily reflect the quality of education in each state.
Additionally, Wisconsin is ranked closer to the median if funding for two-year technical colleges and four-year universities are both taken into account — rather than only looking at four-year universities, Seshadri said.
Though it is unclear why Wisconsin funds two-year technical colleges more than four-year universities, Seshadri said this funding pattern has persisted for many years.
“This is historic,” Seshadri said. “It’s not a recent phenomenon. The ranking of two year colleges has always been superior to the ranking of four year colleges in Wisconsin for the last 20, 25 years.”
While for the UW system, a significant portion of funding is based on longstanding practices, for technical colleges, their funding is more performance based, Seshadri said.
For Wisconsin technical colleges, 30% of state funding is allocated to colleges based on the schools’ outcomes — including job placement, workforce training and transitions out of adult education — and the remaining 70% is distributed based on an enrollment and cost-based statutory aid formula.
The UW system does have an Outcomes-Based Funding model that was introduced by the 2017-2019 State Budget, and in the 2019-2021 budget cycle, $45 million was allocated based on OBF measures — but this is a small portion of total UW allocations, Seshadri said.
Another possible reason for the funding discrepancy between two-year technical and four-year institutions is that state lawmakers have a closer attachment to the local community, and technical colleges are more directly tied to the local labor market, Seshadri said.
For example, if there is a high demand for a particular labor, lawmakers can more easily raise local property taxes — which can be used to fund technical colleges — by framing the raise as a way to benefit the local community, he said. In addition, technical college funding is also decided by the colleges’ boards and local referenda, Seshadri said.
Seshadri said it is important to take both the two-year and four-year institutions into consideration and carefully evaluate whether resources are being allocated efficiently.
“I think we should have a serious conversation about tech college funding versus UW funding,” Seshadri said.
Editor’s note: This article was updated to include that technical college funding is decided by not only lawmakers but college boards and local referenda.
