How are State Budget cuts affecting Spending for Higher Education?

With all of the media reports of state budget cuts and shortfalls, where has the spending in higher education been negatively impacted?  Unfortunately, right now thirty-six states have cut education or proposed such cuts because they face massive, devastating budget deficits in this recession.

Universities across the country are facing similar problems as the economy has pinched state budgets and lawmakers look to make up for shortfalls without raising taxes. Education is by far the largest component of state budgets.  Some 46 percent of all state general fund expenditures is devoted to elementary, secondary, and higher education.

Nearly all states are required to balance their general fund budgets.  When large budget deficits develop, education often is cut deeply.   

The following details cuts in education funding and programs that states have made as they enacted their fiscal year 2009 budgets, additional cuts as they faced mid-year deficits, and cuts that have been proposed for the upcoming fiscal year. According to the Center on Budget and Policy Priorities, most states have proposed cuts that affect higher education:

• In Arizona, Arizona State University plans to address its loss of state funds by holding vacant or laying off 150 to 200 faculty associates, requiring employees to take off an average of three weeks without pay, boosting class size, and reducing enrollment in its nursing school by 5 percent to 10 percent. Tuition in Arizona this year rose 9.5 percent in response to funding cuts.
• In Florida, university budgets and community-college funding were cut. The University of Florida has announced it will eliminate 430 faculty and staff positions and decrease funding for disability services, financial aid services and internship opportunities. Student enrollment is declining by more than 1,000 students at both Florida State University and the University of Florida. The legislature approved a statewide tuition increase for the current academic year of 6 percent; the University of Florida increased tuition for in-state undergraduates by 15 percent.
• In Kentucky, state budget cuts to colleges and universities of about 3 percent led to in-state tuition hikes of 5.2 percent at the Kentucky Community and Technical College System. The Council on Postsecondary Education has also approved in-state tuition increases for universities across the state from 6.1 percent (Murray State University) to 9 percent (University of Kentucky and University of Louisville).  Additionally, the University of Kentucky has announced 188 faculty and staff positions would be eliminated.
• New York has enacted tuition increases for this year and next year. Resident undergraduate tuition will increase a total of 14 percent by the 2009-10 academic year.
• When the state of Rhode Island cut higher education funding last year, the University of Rhode Island, Rhode Island College, and the Community College of Rhode Island all increased tuition for the current academic year.  Each of these institutions now has gone one step further by increasing tuition further mid-year, by 6.7 percent, 8.2 percent, and 4.3 percent respectively.
• Following cuts to state university budgets, tuition increases for the current academic year were announced in Alabama  (13 percent), Maine (10 percent), New Jersey (4 percent to 9 percent), Oklahoma (9 percent to 10 percent), South Carolina (6 percent), Tennessee (6 percent) and Virginia (average increase of 7.3 percent when fees are included).  California is raising in-state tuition for 2009-10 by 7.4 percent to 10 percent as part of its October budget deal, and in December the governor called for additional tuition increases of 9 to 13 percent for some institutions.
• Other states making cuts in higher education operating funding include Connecticut, Georgia, Idaho, Iowa, Louisiana, Maryland, Massachusetts, Minnesota, Mississippi, Nevada, North Carolina, Pennsylvania, Utah, and Vermont.
• Governors in Georgia, Idaho, Mississippi, Massachusetts, Minnesota, Nevada, Pennsylvania, South Carolina and Virginia have proposed additional higher education cuts in their budgets for fiscal year 2010.  Some of these cuts are quite large.  For example:
• Nevada’s governor proposed cutting funding for state universities and colleges by 36 percent compared to the state’s prior budget.
• Virginia’s governor has proposed cutting funding for four-year state colleges and universities by 15 percent. 
• South Carolina’s governor recommended that the state begin phasing out three two-year college campuses.
• The governors in Kansas and Colorado have proposed cutting higher education funding in both the current fiscal year, and the next fiscal year.  Universities in Kansas have already begun making cuts in anticipation of a reduction in state funding.
• For the upcoming year, higher education cuts are also proposed in Indiana, New Mexico, and Washington.

State deficits over the next two and a half years are likely to total more than $350 billion.  Local governments face additional shortfalls.   With education accounting for such a large share of state general fund budgets, it is difficult for states to avoid these types of damaging cuts — which will only get deeper as the recession continues.  The economic recovery legislation passed by the House (and, to a lesser extent, the version passed by the Senate) would reduce the extent of such cuts.

The recent Reinvestment and Recovery Act (or the most recent stimulus package) was partially designed to off-set state budget cuts.  Click here to read about how the states are leveraging their portion of the stimulus.

Sources:
http://www.cbpp.org/cms/index.cfm?fa=view&id=2220
http://www.upstatetoday.com/news/2008/oct/24/budget-cuts-carve-higher-ed...