With the midterms fast approaching, I want to explain one reason why voting matters. No, I am not going to analyze judicial nominees and the horrors of the last two weeks (SNL with Matt Damon being the only bright spot). Instead, I want to discuss how spending decisions by federal and state governments directly impacts rising veterinary debt.
As discussed last week, in 2017, 83% of US veterinary graduates accumulated debt. While $76,130 was the average salary for a veterinarian, mean debt was $141,000. Of the student debt accumulated, 71.2% was attributed to cost of tuition and fees. The increasing number of non-subsidized spots is making it more expensive for more students to attend veterinary college. The average veterinary school tuition paid to attend one of the 30 accredited US veterinary colleges increased 56% from 2009, despite an only 17.5% increase in inflation.
Why did veterinary schools raise tuition so much? Why are in-state spots decreasing?
At least part of the reason is that state and federal budget changes have put increased pressure on higher education.
Impacts of the Recession on State Spending
Some of the problem started with the recession. Tax revenue decreased to state governments and led to cuts in funding for higher education. These funding cuts led colleges to raise tuition to try to avoid damaging cuts to academic programs.
State tax revenue has now improved back to pre-recession levels. However, in 2017, overall state spending for public colleges was still $9 billion (inflation adjusted) below 2008 levels, according to the Center on Budget and Policy Priorities. This means states spent 16% less per student in 2017 than in 2008.
The impact of the recession on revenue was different in each state. In addition, budget priorities are different and the size of higher education cuts has varied. While Arizona, has cut spending per student for higher education by more than 50%, North Dakota actually increased spending. North Carolina and Wyoming have constitutions that specifically mandate that public higher education should be as close to free as practical. North Carolina’s commitment to higher education is evident in that fact that veterinary school in-state tuition at NC State is the least expensive in the nation.
Is it all State Budget Cuts?
A study in 2017 estimated that each $1000 budget cut for higher education led to a $257 increase in tuition.
However, The AVMA Economics Team did some interesting research in 2016. They looked at which states had the highest support for higher education and whether that support correlated with veterinary school tuition. They found that, “the proportion of revenue from state appropriations had zero impact on resident tuition and fees charged at U.S. colleges of veterinary medicine.” A chart of their complete findings can be found here. In this study, they could not look specifically at the way each state appropriated money to individual colleges or how colleges allocate money among departments. They concluded that while state budget cuts undoubtedly have an impact on tuition increases, the colleges also bear responsibility for budget efficiency.
Changes in Federal Loan Programs
Although public universities are state supported, a large portion of financial aid comes from the federal government. One law that had a huge impact on veterinary debt was the Budget Control Act of 2011.
In 2011, the passage of the budget control act eliminated access to federally subsidized loans for all graduate and professional students. This impacted veterinarians because it meant that veterinary students must pay interest on their federal school loans while still in school. Prior to this law, veterinary students could receive a subsidy which covered the interest on their loans while in school and for up to 6 months afterwards. Adding 4 years of interest into loan principal is a big deal and one of the contributors to our worsening student debt crisis. This short article shows the accumulated impact of interest on total loan balance during 4 years of school.
What does this mean?
In their 2017 economic report , the AVMA summarized the impact of these state and federal changes as follows:
“Politically, there is an important message here. For at least the last three decades the public has been defunding public education at the same time the real costs of operating these schools has risen. In short, for the veterinary profession this has shifted the burden of providing animal health from the taxpayer to the animal owner”
I would argue that these state and federal budget changes have also shifted some of the burden of adequate public health not just to animal owners but also directly onto veterinary professionals.
What should we do to minimize rising veterinary debt?
I believe that the role of veterinarians is one that is important for society. Our role in protecting our food supply and in protecting against zoonotic diseases is crucial for our country. I further believe that our profession is best off when we have a diversity of members from all socioeconomic classes. Thus, I believe that we should advocate for improvements in state and federal support for higher education. Without meaningful action, the debt to income ratios will make veterinary medicine an unattractive profession for many.
Vote and understand who you are voting for
While we often look just at the president for elections, state and federal legislative bodies probably have more impact on our day to day lives. It is important as you vote in November to look at the opinions of your state and federal candidates on support for higher education.
One bill introduced into the US House of Representatives that the AVMA supports is HR 2526. This bill would reintroduce the interest subsidy for professional and graduate federal loans. Passage of this bill would be a meaningful step toward decreasing debt to income ratios for new veterinarians.
More information can be found here on this bill , its sponsors , and the AVMA’s position. To contact your representative and recommend that they support this legislation, click here.
Remember that the deadline for registering to vote is fast approaching in most states. Register and vote!
Next week I’ll look at scholarships and what some schools are doing to help students.