What makes private or independent institutions is how they are governed. One of the virtues of private institutions is that their governance is independent or private. Private institutions serve a vital role in higher education in this country because they are a check and a balance to a sometimes overwhelming governmental presence in the governance of public higher education. What then is the appropriate public policy? It is not a question of whether we should support private higher education, but how. Problems involved are: (1) how to narrow the tuition gap; (2) providing access for middle-income students; and, (3) tuition-offset grants tie institutional aid to students. A solution is to provide a state subsidy that is large enough to keep the Private institution in business and attractive to students. The best way to demonstrate that politically is a tuition-offset formula. It is possible to put pressure on the federal government to correct the geographic inequities that are evident and to demonstrate that it is a good bargain for the taxpayers in the state. (Author/KE)