The current budget crisis facing the state of Maine could turn out to be a blessing in disguise. “Some disguise!” many will say. But tight finances should force state leaders, including higher education leaders, to rethink how they do business in providing college and university education to the people of Maine.

The challenges facing Maine and its colleges and universities can be summarized simply. More Maine people need to achieve college degrees if they are to enjoy a higher standard of living. Yet, despite an increasing investment in higher education and increasing enrollment, Maine still lags behind the more competitive states in using higher education to achieve economic benefits for its people.

Maine spends a fair proportion of its discretionary state income on higher education and student financial aid. In the current fiscal year, nearly 10 percent of the state’s discretionary spending went to support public colleges and universities, and to enable students to attend public and private institutions.

Maine hosts a large number of public universities, colleges, learning centers, learning sites and research facilities to serve a small population living across a large state. Maine supports seven universities with 10 campuses and many off-campus learning centers, seven technical colleges with multiple additional learning centers, as well as the state’s maritime academy. As a result of this investment, more than 90 percent of Maine people can reasonably commute two- or four-year learning opportunities.

In the several years preceding the current recession, Maine’s investment in higher education increased annually, as did the numbers of students enrolling and the volume of research activity. Yet, despite these improvements, Maine still lags behind the best performing states in making higher education affordable, in keeping large numbers of college age students in state and in educating its current workforce. As a consequence, the state’s economic future is not as bright as it could be.

If Maine is to put its educational dollars to better use, it will need to examine the way it operates now and consider some alternative ideas that have worked in other states. Here are some examples.

. Student financial aid – Maine’s investment in student financial aid has increased substantially in the past few years. Yet, according to a national report, the percentage of aid targeted to low-income families lags far behind that of the best performing states. Does Maine’s approach to awarding financial aid need to change if we want to help more low-income Mainers go to college? Can state scholarship monies be targeted to encourage more students to enroll in Maine? What can we learn from examples like Georgia’s Hope Scholarship or the Texas Grant program?

. Education for Economic Opportunity – Maine’s colleges and universities prepare students for a variety of occupations and careers, but how well are we preparing them for opportunities that exist or are likely to exist in the state? What have states with rising per capita income done to line up their educational programs with the economic future of the state? Which of these ideas, modified to fit Maine economic environment, have a good chance of working here?

. Organization and structure – University of Maine System Chancellor Joseph Westphal recently caught the public’s attention when he suggested that integrating Maine’s public higher education systems deserved thought. Some states prefer governing boards for each college or university, others have chosen to manage higher education with a centralized board for all or many of their institutions. Maine has three public governing boards – one each for the University of Maine System, the Technical College System and Maine Maritime Academy, but there is no overarching governing or coordinating authority. Is this a good thing? What are the pros and cons of the other models, especially for relatively low income, but geographically sizeable states?

. Community colleges – Maine is one of a handful of states without a community college system. Some believe that this explains why relatively few Mainers go on to higher education. If instituting a community college makes sense for Maine, what role remains for the smaller universities and the many centers and sites, all of which serve a partial community college function? What happens to education for technical fields if the technical colleges evolve into community colleges? How do we avoid expensive duplication of existing programs while meeting student needs?

. Report cards – According to the National Center for Public Policy and Higher Education, compared to top performing states, Maine is average at best on key indicators such as participation in higher education and deriving benefits from it. Maine gets a failing grade on affordability. What do these scores mean? Are the criteria relevant in terms of what Maine wants from its educational system? How do we go about improving our grades, and the quality of service we give to our students and taxpayers?

. Quality – While Maine’s public colleges and universities offer some excellent programs, with the exception of the University of Maine at Farmington, they rank well down on most comparative lists including the influential “U.S. News and World Report.” This may explain why so many of our students leave the state for more prestigious schools and while relatively few out of state students attend in Maine. Should these low rankings concern us? How are they determined and do we believe that the criteria are important? Should some of Maine’s universities adopt a goal of rising from, say, third to second tier? What would be the consequence of such a strategy on enrollment?

. From grants to loans – Congress will reauthorize the federal Higher Education Act in the near future. Based on early signals from the Bush administration, it appears that there will be a continuing shift from grants to loans, continued emphasis on aid for middle-income students over need-based aid to help low income students and greater federal regulation of higher education quality, especially in teacher education.

If these policies become law, what will be the impact on Maine students and their families? What kind of federal financial aid is most useful in light of Maine’s demographics? Will our universities meet federal standards for teacher preparation? What are the consequences if they don’t? Is it fair to threaten to cut off a school’s authority to award student financial aid if it doesn’t meet federal guidelines? Will all of these changes increase the cost of our higher education enterprise?

. Overall higher education strategy – Studies of why some states succeed in harnessing their higher education systems to improve the condition of the people and others fail point to various critical success factors. My own research identifies five such factors: the quality of the political leadership; the power of an inspiring vision; practical and thoughtful planning; a structure that combines authority, responsibility and accountability; and some new financial resources. By applying this template to Maine, we can begin to answer many of the questions posed here and develop a clearer sense of where we do well and what needs to change.

Now is the time for higher education leaders and policy makers to step back and consider how Maine can better serve its citizens through higher education.

Maine needs to continue investing in higher education if the state is not to fall further behind. But Maine’s leaders also need to make the best of this difficult fiscal situation by rethinking our policies and structures so that Maine will be poised to make even better use of its colleges and universities in the future.

Terry MacTaggert, former chancellor of the University of Maine System, is a research professor for UMS.