The latest State Higher Education Executive Officer (SHEEO) State Higher Education Finance Report (SHEF) confirms that the Great Recession accelerated public four-year institutions’ reliance on tuition revenue as state funding declined. Released annually, this report is helpful because it summarizes state appropriations and net tuition revenue for the prior fiscal year well before the Integrated Postsecondary Education Data Set (IPEDS) is available.
The SHEF report provides net tuition revenue, state appropriations and calculates these revenue streams on a per student FTE basis, combining student FTE from all sectors into one state-wide denominator. According to the report, Washington has experienced some of the most significant higher education state funding reductions in the country, particularly over the last five years, at the same time as student enrollment is growing. Table 5 measures educational appropriations by state and shows that Washington’s educational appropriations per FTE decreased 21.2 percent in FY11. Across all states, Washington was one of twelve states that cut higher education funding per FTE over 20 percent, including Utah (20%), South Carolina (32%), and Michigan (24%).
When FY11 state appropriations are combined with net tuition revenue to calculate a total net loss of revenue per FTE, Washington again falls to the bottom quartile of the rankings. However, it is important to note that this calculation includes community colleges, which collect far lower amounts of tuition. Washington’s large community college population significantly lowers the total tuition revenue collected per student FTE and makes it difficult to accurately compare the result to states with a very different mix of types of students.
It is clear that Washington’s public institutions (including the large community and technical college sector and all six public baccalaureates) have experienced significant state funding cuts in recent years and have not raised tuition as much as institutions in many other states. As a result, Washington’s total educational funding shift has been more dire than most when compared to the national average, but the dubious distinction of having the deepest and worst state funding cuts to all of higher education in the last year, much less the last 25 years, belongs to Vermont and New Hampshire.
The first new budget proposal of special session was released today by the same bipartisan Senate coalition that quickly passed an engrossed supplemental budget two weeks ago. Last week, the House further revised the Senate engrossed budget before session ended without agreement on a compromise budget. Although complex and at times confusing, this year’s budget process appears to now be moving forward as today’s Senate budget release moves closer to the House engrossed budget.
The new Senate coalition budget proposal would make the following changes to the UW’s 2011-13 biennial budget:
- Reduces state general funds for the College of the Environment and replaces these funds with State Toxics Control revenue ($5 million);
- Requires that the UW devote a portion of its state funding base to convert existing student FTE to College of Engineering FTE ($3.8 million); and,
- Provides new funds for a Center for Aerospace Technology Innovation ($1.5 million).
All told, the redirect of state funding for engineering enrollment funding and College of the Environment fund swap would affect our FY13 budget base. Please review our Planning & Budgeting brief for more information about the new Senate proposal and how it compares to the current House engrossed budget.
On Thursday morning (3/8), around 12:30 AM, yet another version of the budget (making changes to the Senate engrossed budget) was proposed by Representative Hunter (Chair, Ways & Means) on the last scheduled day of legislative session. This proposal was intended as a compromise between the Senate engrossed budget, written by Senate Republicans, and the budgets proposed by Senate and by House Democrats.
This new House budget amends the Senate engrossed budget, and does not contain new state funding cuts for the UW or the other higher education institutions. However, the budget does contain small central agency service reductions and two unfunded provisos that the UW would fund through its current appropriation. Similarly to previous iterations of the budget, these provisos specify that $3.8 million must be redirected to support engineering enrollments in FY13, and that $790,000 be directed to WWAMI/RIDE in FY12. While the Senate engrossed budget provided new funds for these provisos, the House budget does not; thus, it would require a shift of existing UW state funds and constitute a cut that University units would have to accommodate.
This budget was heard, amended, and passed off of the House floor last night but was not heard in the Senate afterward. A special session to continue the process was announced shortly after midnight, and Governor Gregoire called the Legislature back to session next Monday. We anticipate that negotiating a compromise budget between the multiple versions that have been introduced will be the Legislature’s primary focus next week.
At this stage, changes to the UW’s state funding for FY13 remain uncertain. The two current proposed approaches include a House “budget” that would require the UW to shift $5 million of its appropriation to fund the two provisos noted above, but contains no new overall funding cuts. Meanwhile, the Senate engrossed budget bill does include new funding for the engineering proviso ($3.8m), but makes other changes that result in a loss of $12 million in state funding. When special session starts next week, entirely new versions of the budget may emerge. Stay tuned.
According to the latest survey by the Pew Center for the People and the Press, conducted in late February, the majority of all Americans think higher education contributes positively to the country, while those identifying themselves as conservative were more likely to doubt its benefits. While 67 percent of Democrats believe college affects the country positively, only 51 percent of Republicans and 46 percent of conservative Republicans agree. For those who self-identify as agreeing with the Tea Party, only 38 percent think colleges have a positive effect and 47 percent think they have a negative effect.
That said, both Democrats and Republicans who have experienced higher education think it was a worthwhile personal investment (81 percent and 85 percent, respectively). Furthermore, parents of all political backgrounds fully expect their children to go to college: 99 percent of Republican parents, 96 percent of parents who are Democrats and 93 percent of Independents hope their children will receive higher education.
Finally, the primary purpose of college is debated across the political spectrum. While liberal Democrats tend to say college should focus most on enhancing the student personally and intellectually (47 percent), 52 percent of conservative Republicans think college should focus primarily on teaching skills and knowledge needed in the work world. In general, 47 percent of survey respondents thought skills were the most important, while 39 percent believed personal growth was the crucial component of a college education.
To read more about the survey, please follow the link to the Pew Center report here.
In a rare, surprise move (which has not occurred in the state capitol since 1987), Senate Republicans introduced a striking amendment to the Senate Ways & Means budget on the Senate floor yesterday afternoon and eight hours later, passed their version of the supplemental operating budget with only one amendment adopted. Many amendments were introduced to make changes to the Republican striker, and restore funding to specific areas of state spending, but in the end, only one amendment was carried.
Derek Kilmer (D-Gig Harbor) offered an amendment last night to restore most of the cuts that the Senate Republicans would apply to higher education institutions, passionately declaring, “You don’t have to do this,” after asking where Senate Republicans were doing student testimony on the original Senate budget, which spared higher education institutions from additional cuts.
Despite passionate testimony and procedural action to delay a vote, the new engrossed Senate budget passed 25-24 just after midnight.
This budget is described in greater detail in an OPB brief, which compares the new Senate engrossed budget to the House engrossed budget. All told, the Senate budget would require the UW to take a $12 million cut next fiscal year.
Legislative session is scheduled to end this Thursday, March 8, but this recent shake up will no doubt complicate the last few days of scheduled action.
Debate on the Senate floor yesterday evening was highly emotional and it could take several days before legislators are ready to negotiate differences between the two now very different budget spending plans.