1. Texas Higher Education Coordinating Board 2009 Texas Higher Education Leadership Conference Accelerating Closing the Gaps: Making Opportunity More Affordable for Texas and Texans Where Are the Cost Efficiencies in Higher Education? Dr. Jorge Klor de Alva Former President, University of Phoenix President, Nexus Research and Policy Center University of Phoenix

2. UOPX is a Proud Contributor to Texas Higher Education San Jose Sacramento Las Vegas Salt Lake City Denver Colorado Springs Albuquerque Tucson Phoenix San Diego So. Cal Detroit New Orleans Orlando Seattle Portland Grand Rapids Oklahoma City Tulsa Honolulu Guaynabo, PR Tampa Jacksonville Baltimore Maui Philadelphia St. Louis Cleveland Pittsburgh Boston Dallas Houston Milwaukee Boise Kansas City Chicago Santa Teresa Vancouver, BC Charlotte Reston Billings Wichita Indianapolis Nashville Memphis Worcester Jersey City Columbus Cincinnati Little Rock Columbia Reno Spokane Cheyenne Louisville Minneapolis Des Moines San Antonio Atlanta Raleigh Columbus Austin Omaha Calgary, AB Ft Lauderdale Wilmington Sioux Falls Alaska Birmingham Also includes locations in Mexico and The Netherlands Includes states in which the University is licensed to operate. At the current time we do not have locations in Alaska or Montana

3. University of Phoenix UOPX Is a Comprehensive University: Offering Associate, Bachelor, Master, and Doctorate Programs

4. Helping to Close the Gap Between Educational Attainment of Different Ethnic Groups in Texas and Nationwide Source: NCES 2005 Caucasian 61% Hispanic 10% African American 12% Asian/ Pacific Islander 6% Other/Unknown 10% Native American/Alaskan 1% National Enrollment As of 02/29/2008 Caucasian 51% Hispanic 11% African American 30% Asian/ Pacific Islander 3% Other/Unknown 4% Native American/Alaskan 1% University of Phoenix Enrollment 2009

5. University of Phoenix Cost Efficiencies Through Innovation: A New Learning Platform—Again

6. Online Modality For Students Onsite and Online: Full Integration of Technology University of Phoenix Online Campus ( Established in 1989, Before WWW available to general population) 1996 enrollment 2,000 2008 enrollment >200,000 R e source: Digitizing Education Products and Services All course materials delivered via electronic portal Allows for rapid revision of materials Includes rich media Permits 24/7 access from anywhere

7. 1720+ courses maintained by Colleges 1690+ courses completely electronically enabled with Electronic textbooks (over 1,800 works) Electronic articles (online library <20million articles; 65K publications; 114 databases) UPX-owned writings Discussion questions Web links 260+ courses use Simulations (<140K unique users/month) 400+ courses use Virtual Organizations (over 76K unique users per month) 100+ courses have Web tutorials 100+ courses use Electronic Portfolios (over 15K unique users per month) University of Phoenix Online Course Delivery: Comprehensive and Multidimensional

8. Online Delivery of Support: Student-centered, Ubiquitous University of Phoenix Center for Writing Excellence WritePoint sm (Immediate feedback; <600K papers/month) Tutor Review (Faculty reviewed, within 48 hrs; <6K papers/month) Spanish Writing Lab (El Centro de RedAcción) Dissertation Services Tutorials and Guides Turnitin Plagiarism Checker (promotes originality and improves writing and research skills; <400K papers/month; 15 minute turnaround) Center for Mathematics Excellence Running Start Online Tutoring (< 4K live tutoring sessions per month; approximately 10K students per month access site for assistance) Self-Assessments University Library

9. Onsite Support for Online and Onground Modalities University of Phoenix Local Resource Centers Nationwide First centers were established in Texas 25 new centers by end of last year Drop-in centers for computer usage, tutoring, etc. Open and staffed 7 days a week Available to all students and faculty – both online & onsite Creates community for students and faculty of both modalities

10. University of Phoenix Does All This Technology-Based Support Lead To Success?

11. University of Phoenix Key Predictors of Degree Completion for Open Enrollment Institutions High School Grades Transfer Credits Risk Factors All only partially predict success

12. University of Phoenix Number of Risk Factors vs. Bachelor Graduation Rate (%) Note: Almost all UOPX students in the 1998–2000 cohort studied had R6 (financially independent) and R7 (working full time) risk factors as determined by USDOE because UOPX required students at that time to be working and at least 23 years old.

13. University of Phoenix Transfer Credits vs. UPX Bachelor Graduation Rate (%) Data Source: UPX cohort 11/1998 to 3/2000.

14. University of Phoenix Taxpayer CostsPublicNot-for-ProfitFor-ProfitUPX Direct Government Support 2 $11,992.06$5,641.11$712.49$0.00 Student Loans –Interest Rate Subsidy 4 38.1693.78152.51123.66 Expected Future Loss Due to Loan Default 5 64.1480.15527.44599.67 Taxes Forgone on Investment Income of Endowments 6 550.257,079.640.00 Taxes Forgone on Additions to Endowments 7 39.7392.450.00 Taxes Forgone on Gifts, Grants, and Contracts 8 325.362,406.550.00 Taxes Forgone on Corporate Profits 9 2,387.785,534.640.00 Sales & Other Taxes Forgone 10 131.20304.100.00 Total Costs$15,528.66$21,232.41$1,392.44$723.34 Taxpayer Credits Tax on Corporate Profit 11 0.00 1,146.91818.06 Sales and Other Taxes 12 0.00 63.0246.09 Taxpayer Credits0.00 1,209.93864.15 Net Cost to Taxpayers$15,528.6621,232.41182.51-(140.82) Research Expense 13 2,279.274,563.000.00 NET COST TO TAXPAYERS WITH RESEARCH EXPENSE REMOVED $13,249.39$16,669.42$182.51-($140.82) Cost Efficiencies To the State: Net Cost to Taxpayers Per Students