This report contains data on state funding for higher education for the 1997-1998 school year. State funding for higher education continued to grow in FY98 for the fifth straight year, increasing 6%, or $2.8 billion, over the prior fiscal year. The amount of support for higher education exceeded $49 billion, and the 1-year and 2-year percentage gains were the largest since 1990 and were nearly enough to make up for the recession of the early 1990s. Only four states (Alaska, Hawaii, New Mexico, and Tennessee) reduced their general funding appropriations for higher education from the previous year, and their cuts were rather small. Appropriations grew in every other states except Wyoming, where state funding remained flat. Although higher education fared well financially during this fiscal year, there continued to be a fundamental anxiety about higher education, resulting in a number of proposed or enacted restrictions and accountability measures for higher education. The report contains a discussion of higher education appropriates and national trends, followed by national tables and some comparative measures. A third section discusses state-by-state appropriations. (Contains 3 figures, 15 tables, and 17 references.) (SLD)