Higher education has always been one of the things that North Carolina does exceptionally well.

With the nation’s oldest public university as its flagship, the UNC System has established itself as one of the country’s best — all while keeping tuition relatively low compared to peer institutions.

But over the years, the state’s investment in higher education has waned. Losses suffered during the Great Recession were never fully regained once Republicans took control. At the same time, the UNC System has seen record enrollment on an almost yearly basis, stretching that funding even thinner.

So if the state isn’t paying for higher education, then who is?

Like most other states, North Carolina cut funding to higher education during the 2008 financial crisis. But while most states slowly began to restore that funding once the economy recovered, North Carolina did not. Instead, the state has continued to fund higher education as if money is tight. Per-student appropriations for higher education in North Carolina decreased by 13% between 2008 and 2020, when adjusted for inflation. The U.S. average in that same time period was just a 2% decrease.

In 2010, Republicans gained control over both chambers of the state legislature for the first time in more than a century. They ran on a platform of fiscal conservatism, suggesting a significant departure from the decades of public investment while Democrats were in charge.

The next year, Republicans started cutting. Facing a hefty budget deficit, they dealt a $414 million cut to the UNC System in 2011 — about 15% of the system’s operating budget. That cut alone forced the elimination of thousands of jobs and a dramatic reduction in course offerings.

Further, albeit smaller, cuts to UNC System funding were made in following years, along with some modest increases. But since 2010, funding to the UNC System has decreased overall, when adjusted for inflation, while funding for the state’s community colleges has increased, according to data compiled by researchers at the American Association of University Professors.

In 2013, after the state elected a Republican governor, the GOP began to radically overhaul the state’s tax code, which they promised would boost the state’s economy. Not only did that growth never really materialize for low- and middle-income North Carolinians, it also cost the state billions in lost revenue that could have gone to needs like higher education.

“The philosophy of the Republican Party is to cut taxes. That’s one of their top priorities. And when you cut taxes, you have to cut services. And so I think they’ve gone through and cut most every department in state government. So everybody’s struggling,” Rep. Verla Insko, a Democrat who has represented Orange County for 26 years, said. “It is a strange philosophy, not to provide the best education.”

The most recent state budget contains $2.3 billion for facility repairs and renovations that are long overdue, and it expands the NC Promise program, which drastically lowers tuition costs for in-state students, to a total of four universities. But it also contains more tax cuts, including phasing out the corporate income tax entirely by 2030 — which could result in billions of dollars more in lost revenue.

The state constitution says that the legislature “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.”

But after more than a decade of Republican leadership, the burden of financing higher education has slowly shifted away from the state and onto students and their families. While state appropriations per student have fallen, net tuition revenue per student grew 41% in the same 12-year period — meaning that students are paying a bigger share.

Despite tuition freezes and the implementation of NC Promise, the out-of-pocket cost of attending college has increased dramatically, most of all for low-income families. Between 2008 and 2020, the average net price of tuition at UNC System universities increased by nearly 120% for families at the bottom of the income distribution, data show, compared to just 17% for those at the top. The average net price of tuition represents what a family actually pays for college: tuition, fees, housing, books and supplies, minus any financial aid or scholarships. Tuition freezes didn’t stop the UNC System from imposing fee increases over the years, and the rising cost of living has significantly outpaced any increases in household income.

“Because of the 2016 decision to freeze tuition and create NC Promise, there’s a very strong narrative among the Republican majority that they fixed the tuition issue,” Alexandra Sirota, executive director of the NC Budget and Tax Center, said. “There may be more people receiving financial aid, and a reduced tuition. But it isn’t overcoming the fact that incomes aren’t growing, and the cost is a significant one for most households in North Carolina.”

Faculty are also feeling the effects. Though the demands of their job have increased as enrollment explodes, UNC System faculty say their salary growth hasn’t kept up with inflation, even with the 5% raises included in the new budget. They also haven’t remained competitive with pay at peer institutions, according to data compiled by the Chronicle of Higher Education.

The decline in state funding has also spurred a growing need for private contributions, which can come with their own set of challenges. Wealthy donors, such as UNC-Chapel Hill’s Walter Hussman, hand over money with strings attached. But those strings — which can have real implications for the quality of education and the student experience — are not always disclosed to the public.

The UNC System was built on public dollars and a clear vision of what it could and should be. But as those public dollars begin to dissipate, what will happen? If this pattern continues, North Carolina’s greatest asset may become one of its greatest failures.