Between 2002 and 2012, primarily during Governor Jim Doyle’s tenure, UW-Madison’s tuition and fees increased more than 100% for resident undergraduates. During that same 10 year period, Wisconsin’s tuition increase was larger than all other public Midwestern Big Ten universities, according to a report written by the non-partisan Legislative Fiscal Bureau.
Additionally, the report exposed a $1.35 billion cash and cash equivalent slush fund found in the University of Wisconsin System’s annual report. Dropping some line items, the Fiscal Bureau lowered the amount to $1.05 billion. Lastly, because UW System officials have marginal control on how the money is spent from federal aid, grants, and gifts, they were subtracted from the total, bringing UW System cash reserves to $648 million.
In Governor Doyle’s 2003-2005 budget, he cut $250 million from the UW System’s funding. However, he allowed tuition to significantly increase, back filling his cut. Simultaneously, students’ higher tuition built the system’s slush fund.
Rising college costs resulted in students taking out larger loans. Student loans are unsecured loans. As any creditor will confirm, an unsecured loan does not have collateral such as a home or car insuring its repayment. Therefore, unsecured loans generally have a higher interest rate.
To address student debt, this session the Wisconsin State Assembly passed a series of bills. Altogether, the bills would eliminate any cap on the tax deduction for student loan interest, increase grants for Wisconsin technical colleges, create grants for students in emergency financial need, and provides internship coordination with employers for students.
Additionally, an institution of higher education must now annually provide its students with a letter to inform them of the cost of their education. Also included on the letter will be the total amount of debt accrued under their loan to date, its interest, and standard repayment terms for their type of loan. It will also include the estimated monthly payment due under the loan when the repayment period commences as well as the total projected amount of both principal and interest to be paid over the term of the loan.
Not one Democrat voted for any of the bills. Instead, they introduced their own package called the Wisconsin Student Loan Refinancing Authority. The Wisconsin Student Loan Refinancing Authority included very little detail, but it is similar to Minnesota’s SELF Refi program.
In Minnesota, to participate in the program a person must be a state resident holding a certificate or degree, and owe at least $10,000 in federal or private student loans. Furthermore, participation requires a 720 credit score. Their total debt to income ratio cannot exceed 45%. Minnesota’s plan makes a good Democrat talking point, but requiring a 720 credit score presents an enormous roadblock.
Credit Karma accrued average credit score statistics. According to their research, an 18 to 24 year old’s average credit score is 630. The average score decreases to 628 for people between 25 and 34 years old. From 35 to 44, the average only increases to 629. People 45 to 54 average a jump to 646. In fact, the 720 threshold isn’t attained even at the 55+ mark. That age group averages 696.
As with any purchase, the best way to control costs is to limit them from rising. Therefore, I voted to freeze tuition in the last 2 biennial budgets for resident undergraduates at all University of Wisconsin System institutions. Meanwhile, Democrats who propose using your tax dollars to refinance student debt voted against the freeze.
Instead of freezing tuition, the Democrat‘s newest talking point would be to give away free college education using your hard earned money, further removing cost control and accountability. Proposals are easy though when the money they spend isn’t theirs – it’s yours.