Funds to Public Universities in Danger as State Revenues Sour

The current downswing in the economy is impacting appropriation levels to public institutes of higher education, requiring universities and colleges to pursue both short-term and long-term solutions to improve their revenues. In a recent survey to its membership, the Association of Public and Land-grant Universities (APLU) found 85 percent of schools experienced a reduction this year in state appropriations compared to the previous year. For almost half of responding public universities, the cut exceeded 10 percent.

In Coping Strategies of Public Universities During the Recession of 2009, the APLU found 70 percent of its membership used federal stimulus funds to manage costs and close existing budget gaps.

Continued future decreases in state revenues may remain a problem for several fiscal periods. According to state-by-state information posted at the website for the National Conference of State Legislatures (NCSL), new budget gaps have opened in at least 31 states since their 2010 fiscal years began.

The APLU survey found a variety of short-term strategies public universities have implemented at various degrees to manage costs. More than three out of four universities reduced permanent staff positions, 63 percent deferred maintenance, 47 percent adjusted heating and cooling levels, 31 percent eliminated courses, 17 percent eliminated departments, and 9 percent laid off tenured or tenure-track faculty. The most cited long-term strategies included investing in energy-saving infrastructure, increasing enrollment in targeted groups, and reviewing administrative structures.

More recently, several states have implemented an old standby to solving revenue gaps at universities: raising tuition.

Gaining national attention, the Board of Regents for the University of California approved a plan on Nov 19 to increase undergraduate tuition at the state's universities by 32 percent, as the system experienced a $600 million cut in funding.

Last Monday, Kansas Gov. Mark Parkinson announced a $2 million reduction to higher education, adding to a $100 million cut from earlier this year. Overall, Kansas state funds to higher education have been reduced by 13 percent this year as the state is facing a deficit last pegged at $260 million. Just across the state line, Missouri is attempting to freeze tuition and academic fees for the second straight year at their public colleges and universities. To reach this stabilization on costs to students, Gov. Jay Nixon has offered Missouri universities 95 percent of last year's state funding if they kept tuition flat.

Coping Strategies of Public Universities During the Recession of 2009, produced by the APLU, is available at: http://www.aplu.org/NetCommunity/Page.aspx?pid=1393.

NCSL’s website dedicated to “FY 2010 Post-Enactment Budget Gaps & Budget Cuts” is available at:http://www.ncsl.org/?tabid=18690.