The State Higher Education Finance (SHEF) report is a tool to help policy makers and educators address broad public policy questions. SHEF seeks to inform policy deliberations with information and perspective on financial issues and national trends. The fiscal 2004 SHEF study documents a four-year period when state funding for higher education failed to keep pace with enrollment growth and normal inflation in the United States, leaving per student state and local funding near their lowest levels nationally in 25 years. Appendixes include supporting tables, respondent listing, and copy of the web-based data collection instrument. (Contains 12 figures and 14 tables.) [Additional contributors include Hans P. L'Orange, Susan B. Winter, and Dianne Peterson. For the FY 2003 report, see ED485514.]