The Federal-State Higher Education Partnership How States Manage Their Roles

State funding of public higher education is central to college access and affordability and to postsecondary educational attainment. State support translates into resources colleges and universities can spend on instruction and other activities or to charge lower tuition prices, especially to in-state students. Each state develops its own higher education systems and determines funding for public institutions and for financial aid for its students. Differences in institutional structures and funding models combine with economic and demographic differences to create sharp variation in the educational opportunities available to students across the nation. This brief describes differences across states in per student funding levels, distribution of funding across postsecondary sectors, systems for determining these funding patterns, and state grant aid offered to students who enroll in these institutions. It examines how these policies interact with federal subsidies for college students and how they further or counteract the goals underlying federal policies.