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If you are unhappy with your tuition at one of the sixteen North Carolina public universities, perhaps you should sue!

While lawmakers debate how to handle the cost crisis within American higher education,2 students are taking matters into their own hands.3 Students in Arizona, California, and Maryland have recently brought suit, some of them as class actions, against their states for tuition increases. While some of these cases are based on contract theories,4 a more novel approach is to base the claim in state law or in a constitutional provision.

In one such case recently decided, the University of Missouri System could face damages up to $450 million for charging tuition to in-state undergraduates in violation of state law.5 Missouri was among several mid-western states that adopted tuition-free laws in the 1800s to increase access to higher education for rural youths. Missouri did not repeal the law until 2001.6 Despite the tuition free law, Missouri charged student “fees” which the district court held to violate the state law. The case has been remanded by the Missouri Supreme Court to the district court to determine damages.

These suits are fueled by the phenomenal growth in the cost of college. Tuition and fees for a full-year of college at an American public 4-year university has increased from $376 in 1972 to $4,081 in 2003. These increases have far outpaced family income. While North Carolina universities cost less than the national average, the rate of increase in these costs is significant. North Carolina has experienced a 94% increase in tuition and fees at its public universities over the past nine years ($1,467 in 1995 to $2,847 in 2003).8

Cost increases have been largely attributed to a failure by state governments to increase appropriations for higher education. However, “Americans believe wasteful spending by college and university management is the number-one reason for skyrocketing college costs.”9 While fingers are pointing at state legislators and college administrators, students may also share some of the blame. Student fee charges make up forty percent of costs. These funds are used to cover services often demanded by students including: athletics, health services, recreational centers, student activities, and other non-academic expenditures.10

The cause of the significant increases in tuition and fees may receive new attention in light of law suits based on state constitutions or laws which require cost accountability. The North Carolina Constitution requires such accountability. “The General Assembly shall provide that the benefits of The University of North Carolina and other public institutions of higher education, as far as practicable, be extended to the people of the State free of expense.11 The plain language suggests public higher education in our state should be free or, at minimum, cost contained. This provision of our Constitution has never been litigated. A similar provision will soon be litigated in Arizona.

Students in Arizona are bringing a class action lawsuit based upon a constitutional provision very similar to North Carolina’s. “The University and all other State educational institutions … shall be as nearly free as possible.”12 The suit claims that “the higher tuition has placed a financial burden on students, forcing some of them to borrow substantial amounts of money.”13 Interestingly, the student newspaper ran an editorial opposing the lawsuit out of concerns over a potential loss of quality to the university.14

Quality seems to go to the heart of the issue. Assuming “free of expense” to the extent practicable means as close to free as possible, changes would be necessary to comply with the constitutional mandate. A state could: 1) increase tax revenue to maintain public universities as they are, 2) apply a new business paradigm to delete ‘unprofitable’ areas, 3) discontinue activities not directly related to teaching, or 4) some combination of these. While academic endeavors may be more likely to remain free from reach, student recreational centers and football games could be dropped or wholly funded on a user basis. Regardless of the approach, it seems the traditional autonomy academia has enjoyed would be lost.

The federal government is also threatening that autonomy. “Rep. Howard (‘Buck’) McKeon announcd [sic] March 7 in a speech before the Education Finance Council that he will introduce a bill designed to increase college affordability and access for college-qualified students.”15 While colleges strongly oppose the price control measures suggested by McKeon, students are in support. “No longer will students and parents accept the fact that universities are paying some professors more than $200,000 per year, when the professor does not teach class.”16

It is not surprising colleges object to price controls, especially when you understand that in many states public universities set their own tuition and fees. Our legislature has vested authority for setting tuition and fees in the Board of Governors of the University of North Carolina System.17 Thus, the very ones responsible for the expenditures have the ability to control the increases in price. A successful constitutional challenge would likely require a reexamination of this approach. What is surprising is that our legislature has specifically outlawed free tuition in direct contravention of the spirit of our Constitution.18

If a similar challenge was launched in North Carolina, the nature and scope of the state constitutional right or interest would need to be determined. These issues have never been litigated in North Carolina. The phrase “as far as practicable” appears in North Carolina case law but has not been defined. This language clearly qualifies the requirement to some extent as compared with other provisions in the constitution like that which says the legislature shall provide free public schools.19 This will be a major issue for the court to decide.

In light of the success of Leandro v. State and its successor Hoke Co. v. State in recognizing a fundamental right to a basic education at the primary school level based on the state constitution, a challenge to the current tuition and fees system is not unthinkable. Do not be surprised if savvy North Carolina students tired of huge increases take their fight to court.

Originally published in the March 2004 issue of the Campbell Law Observer. (Reprinted with permission.)

Authored by Mark Spencer Williams, Esq. and Managing Member, Rice Law, PLLC


FOOTNOTES:

Note: URLs, which were listed in the original publication, have been updated per the last access date shown.

1 The University of North Carolina System includes the following 16 constituent campuses: Appalachian State University (ASU); East Carolina University (ECU); Elizabeth City State University (ECSU); Fayetteville State University (FSU); North Carolina Agricultural & Technical College (NCA&T); North Carolina Central University (NCCU); North Carolina School of the Arts (NCSA); North Carolina State University (NCSU); The University of North Carolina at Asheville (UNCA); The University of North Carolina at Chapel Hill (UNC-CH); The University of North Carolina at Charlotte (UNCC); The University of North Carolina at Greensboro (UNCG); The University of North Carolina at Pembroke (UNCP); The University of North Carolina at Wilmington (UNCW); Western Carolina University (WCU); and Winston-Salem State University (WSSU). Available at http://www.northcarolina.edu/content/our-17-campuses (last accessed Nov. 18, 2009)

2 Press Release, House Committee on Education and Workforce, House GOP Education Committee Leaders Release Report on College Cost Crisis, Sept. 4, 2003.

3 Jennifer Jacobson, Students Sue States Over Tuition Increases but Face an Uphill Battle, The Chron. Of Higher Education, Sept. 19, 2003.

4 Gamble v. Univ. Sys., 136 N.H. 9, 610 A.2d 357 (N.H. 1992) (holding that students who were not notified of mid-year tuition increase are not liable for increased costs under contract theory).

5 Michael Arnone, State Supreme Court Rejects Appeal by U. of Missouri in Huge Tuition Lawsuit, The Chron. Of Higher Education, Aug. 27, 2003.

6 Jim Suhr, State Supreme Court bounces Missouri tuition lawsuit back to trial court, Associated Press, Aug. 26, 2003.

7 The College Board, Trends in College Pricing (2002), available at www.collegeboard.com/press/cost02/html/CBTrendsPricing02.pdf (last accessed Nov. 18, 2009).

8 The University of North Carolina, Statistical Abstract of Higher Education in North Carolina, 2001-02 tbls.49-50 (2002); The University of North Carolina, Statistical Abstract of Higher Education in North Carolina, 1994-95 tbls.57-58 (1995).

9 Press Release.

10 The University of North Carolina, Statistical Abstract of Higher Education in North Carolina, 2001-02 tbls.49-50 (2002); The University of North Carolina, Statistical Abstract of Higher Education in North Carolina, 1994-95 tbls.57-58 (1995).

11 N.C. Const. art. IX, § 9 (2003) (emphasis added).

12 A.R.S. Const. Art. 11, § 6 (2003).

13 Elvia Díaz, Students file suit on state tuition hike, The Arizona Republic, Aug. 27, 2003.

14 Editorial: Tuition lawsuit dangerous, Arizona Daily Wildcat, Aug. 28, 2003.

15 Rep. McKeon to Introduce Bill Penalizing Colleges for Tuition Hikes “Beyond Reasonable Rates”, NASFAA, Mar. 6, 2003, available at http://www.nasfaa.org/home (last accessed Nov. 18, 2009).

16 Testimony of Ms. Jessica Hanson, House Committee on Education and Workforce, Sept. 23, 2003.

17 N.C. Gen. Stat. § 116-143 (2003).

18 N.C. Gen. Stat. § 116-143.

19 N.C. Const. art. IX, § 2 (2003) (emphasis added).

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