State budget troubles deepen; bad news for State U's?

Parent Cafe
1

<p>Almost all states are now projecting shortfalls in the FY 2010 budgets, but the hardest hit are not necessarily those you might expect.</p>

<p>Worst projected FY 2010 deficits, ranked by % of state general fund</p>

<li>Nevada $1.1 billion 30%</li>
<li>Arizona $3.0 billion 29.8%</li>
<li>California $25.9 billion 25.6%</li>
<li>New York $13.7 billion 24.3%</li>
<li>Connecticut $4.0 billion 23.1%</li>
<li>Florida $5.8 billion 22.6%</li>
<li>Louisiana $2.0 billion 21.7%</li>
<li>Vermont $253 million 20.8%</li>
<li>Wisconsin $2.9 billion 20.3%</li>
<li>Washington $2.8 billion 18.2%</li>
<li>Kansas $1.1 billion 16.7%</li>
<li>North Carolina $3.3 billion 15.3%</li>
<li>Delaware $557 million 15.3%</li>
<li>Minnesota $2.5 billion 14.7%</li>
<li>Idaho 411 million 13.9%</li>
<li>Rhode Island $450 million 13.7%</li>
<li>Maryland $1.9 billion 12.5%</li>
<li>New Jersey $4.0 billion 12.3%</li>
<li>Iowa $779 million 12.2%</li>
<li>Utah $721 million 12.1%</li>
<li>Hawaii $682 million 11.9%</li>
<li>Massachusetts $3.1 billion 11.0%</li>
<li>Virginia 1.8 billion 10.4%
AVERAGE, ALL STATES 15.9%</li>
</ol>

<p>not reporting: Illinois, Kentucky, Missouri, New Mexico, Oregon, Pennsylvania </p>

<p>[State</a> Budget Troubles Worsen](<a href=“http://www.cbpp.org/9-8-08sfp.htm]State”>http://www.cbpp.org/9-8-08sfp.htm)</p>

<p>Surprisingly, perhaps, the economically hard-hit states of Michigan and Ohio are projecting much smaller budget shortfalls of 6.9% and 7.1% respectively, in each case less than half the national average.</p>

<p>These estimates are preliminary and subject to change. But it’s numbers like these that governors and legislatures will be contemplating as they make decisions about funding levels for public higher education. Some public universities have already felt the fallout. Nevada’s governor, for example, is recommending a draconian 30% cut in state aid to higher education, in line with that state’s whopping budget shortfall. Very likely we’ll see few if any increases, but on average we can expect schools in the states with the largest budget shortfalls to feel the axe blade first and hardest. </p>

<p>What’s the latest on your own state’s budget situation and its implications for public higher education?</p>

2

<p>The following is information from Penn State Live; this is the official news source of the Penn State University. It is important to note that Penn State is not considered a state university. It is considered a “state related” university that receives partial funding from the state.</p>

<p>Penn State faces a $21 million cut in state funding with next year’s proposed state budget announced in Harrisburg Feb. 4.</p>

<p>“The University understands the extraordinary circumstances faced by the Commonwealth and is prepared to do its part,” said President Graham Spanier.</p>

<p>"The University will manage by freezing employee salaries next year and by implementing internal budget reductions,” Spanier said. “We also will do everything possible to hold tuition increases to the same level we announced last fall as our initial plan for 2009-10.”</p>

<p>The $318 million proposed direct Penn State appropriation is a $20.3 million cut from the original 2008-09 appropriation of $338.4 million. In addition, medical assistance funds provided to the Hershey Medical Center is anticipated to be reduced by approximately $900,000. This overall proposed Penn State funding level is less than the original University appropriation in 2001.</p>

<p>As part of his budget package, Gov. Rendell has proposed a tuition relief program for families earning up to $100,000 a year who have students attending any of Pennsylvania’s 14 community colleges or the 14 public universities in the State System of Higher Education.</p>

<p>"The governor’s recently proposed financial assistance plan for Pennsylvania students from families with income below $100,000 is laudable,” Spanier said, "but it is imperative that it include Penn State students, who for some reason were omitted.</p>

<p>“State funding to help students afford the cost of public higher education in the Commonwealth should be based on the needs of all students attending public universities,” Spanier said. “The plan, as proposed, excludes otherwise qualified students who attend the state-related universities, such as Penn State.”</p>

<p>There are 30,931 Pennsylvania residents attending Penn State this year who come from families who would qualify for this program — the largest number of residents with financial need at any university in the state.</p>

<p>"There are a number of majors in engineering, agriculture, science and business fields that are uniquely offered at state-related institutions. Students graduating in these fields are critical to the future of the state. We think those students should qualify for financial assistance.</p>

<p>“A decade of state funding cuts for Penn State is having an impact on the resources of our students and their families,” Spanier said. “This program could make a big difference in their lives.”</p>

<p>During the next several months, University officials will continue to discuss funding needs for the institution and its students and families with members of the Legislature. A final state budget will be due on July 1, 2009. Several days later, Penn State’s Board of Trustees will meet to set tuition levels for the next school year.</p>

3

<p>The R’s fiscal conservatism is coming to pass. The downside is that the when the Beast is strangled, the Beast does not go quietly. :slight_smile: </p>

<p>This was foreseen many years ago and must be played out.</p>

4

<p>Whew </p>

<p>Montana and Wyoming hanging in there…</p>

5

<p>desilu [cute moniker],</p>

<p>Thanks for the PA update. That translates to about a 6% cut in state appropriations to Penn State. A hit, but not devastating, especially in light of the governor’s tuition relief program which I take it will help families earning under $100K to make up for at least a fraction of any tuition increases necessitated by the budget cut. Any details on how the
tuition relief plan will work?</p>

6

<p>New York: Looks like SUNY/CUNY rates will go up, but a state sponsored loan program has been proposed for instate students.</p>

<p>Higher Education: Based on the recommendations of the New York State Commission on Higher Education, the Executive Budget would establish the New York Higher Education Loan Program (NYHELPs) which will provide a minimum of $350 million in loans to approximately 45,000 New York State residents attending New York higher education institutions. The loans will be offered at rates well below those currently available in the private loan market. Additionally, a SUNY ($620, 14 percent) and CUNY (up to $600, 14 percent) tuition increase tied to an investment plan is also recommended, which will provide a year-to-year increase in core instructional budget resources for those universities.</p>

7

<p>Wisconsin–no major cuts–basically a flat budget. Much better than I expected. If they get any raises that will be added later.</p>

<p>[WISCONSIN</a> STATE JOURNAL](<a href=“http://www.madison.com/wsj/arch_local/439119]WISCONSIN”>http://www.madison.com/wsj/arch_local/439119)</p>

8

<p>^ Interesting play by Wisconsin Gov. Jim Doyle in light of Wisconsin’s $5 billion+ budget hole. Basically he’s saying cut everything EXCEPT K-12 and higher ed, and at the same time raise several billion in new and/or higher taxes including a cigarette tax hike, a new top income tax bracket, and a new tax on oil companies. State agency budget cuts include closing 3 dozen Dept of Motor Vehicles offices, two state trooper stations, and 25 Department of Natural Resources offices.</p>

<p>[WISCONSIN</a> STATE JOURNAL](<a href=“http://www.madison.com/wsj/arch_local/439116]WISCONSIN”>http://www.madison.com/wsj/arch_local/439116)</p>

<p>It will be interesting to see how much of this he can get through the legislature. It probably makes sense for Doyle, a Madison guy, to protect the University of Wisconsin and K-12 education. He can posture as the good guy and let the legislature do the dirty work. But my guess is when all the smoke clears UW will be sharing some of the cuts. I don’t think he can get all those tax increases through during a recession, and smalltown and rural legislators will fight like hell to keep their local DMV offices, state trooper stations, and DNR offices. Well, maybe not the DNR offices.</p>

9

<p>I’m not sure of the details, but I believe the governor was taking credit for the tuition assistance in a speech this week. Check the PA newspapers on line for more information.</p>

10

<p>bclintonk–I think the Gov and many on the state have realized that the cuts imposed by the prior Republican admins did some real harm to the UW and that the new admin sees the UW as one key to building a better Wisconsin economy. It’s really the only major thing they have going for them today. Manufacturing-dying. Ag-up and down. Today milk sells for less than it costs to make and farms are selling off herds. Tourism and tech are the only growth areas left.</p>

11

<p>^ I totally agree, barrons. UW Madison is probably Wisconsin’s single most valuable asset. Good luck to Gov. Doyle in shielding it from the budget axe in this perilous economic and fiscal environment.</p>