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Federal Budget Proposals Affect Higher Education

The 91探花Office of Federal Relations has posted detailed summaries of how recent federal budget proposals may affect higher education. As the that target Pell grants and funding for federal agencies that support academic research, that largely protects financial aid and research and development.

Visit often for updates on federal budget negotiations.

Virginia Close to Passing Major Higher Ed Reform

Virginia’s Governor, Robert McConnell, endorsed all of the recommendations made by the he created last year to explore policy options for higher education reform. The resulting has moved quickly through both the House and Senate and may soon be on its way to the Governor. The bill provides $50 million in new funding for higher education institutions in Virginia, a 91探花Global Challenge State peer, as a ‘downpayment’ on the lofty reform goals outlined by the bill, including:

  • Producing 100,000 additional degrees over the next 15 years.
  • Providing incentives to increase enrollment of Virginia residents by creating target resident enrollment goals for institutions.
  • Creating incentives for improving retention, graduation, and time-to-degree.
  • Crafting new performance agreements focused on policy outcomes.
  • Enhancing efficiency by increasing institutional managerial autonomy.
  • Creating a higher education rainy day fund for use in economic crisis.
  • Establishing objective, peer-based funding goals.
  • Increasing state support and reducing reliance on tuition revenue.
  • Restoring state aid for students attending non-public Virginia colleges.
  • Increasing state need-based aid for low and middle income students.
  • Increasing year-round use of physical and instructional resources.
  • Increasing use of technology in the classroom, and increasing online course offerings.
  • Increasing enrollment in dual credit programs to shorten time-to-degree.
  • Creating public/private partnerships to increase STEM degree attainment, and facilitate commercialization.
  • Creating a catalog of R&D assets and activities so that the state can align investments with existing strengths/activities.
  • Creating an emerging technologies fund to recruit faculty, purchase equipment and provide seed funding.

The Washington State legislature is considering its own right now. Make sure to follow its progress via our (bill number 5717).

State of the States

We continue to closely follow the fate of Washington State’s budget, but are also keeping our eyes on what is happening in other states. Below are some resources that you might also find of interest:

Education Week provides as they are made in each state.

The Center on Budget and Policy Priorities (CBPP) continues to and policy actions as they unfold.

The National Association of State Budget Officers (NASBO) posts relating to state budgets, including this to the Washington State federal delegation in response to the idea that the Federal Government may be considering .

New OPB Brief on Institutional Autonomy

The economic outlook for state budgets remains bleak and additional steep cuts to public higher education inevitable, making it imperative to re-imagine how institutions can become more efficient and self-sufficient while remaining effective and accountable to the public. For many institutions greater autonomy from the practices and requirements of state government seems attractive, and this topic is explored in on variations in institutional autonomy among the 91探花and its peers.

Somber State Budget Update Presented to 91探花Regents

Paul Jenny, Vice Provost of Planning & Budgeting, to our Board of Regents last Thursday.聽Paul touched on the upcoming state revenue forecast, the Governor’s cuts to all institutions, and the impact of future state funding cuts on campus.

The Regents expressed many concerns throughout the presentation, but a few points proved especially troubling:

  • If the Governor’s budget is adopted, higher education institutions’ funding would be cut by half, or $500 million since FY 2008.
  • State funding for higher education institutions on a per student full time equivalent (FTE) basis has deteriorated. While the state covered 70% of funding per student FTE in 1991, the Governor’s budget would only cover 30% of needed funding per student FTE.
  • The Governor’s budget proposes 11% tuition rate increases for resident undergraduates, but even with tuition increases factored in from all student categories, the 91探花would still face a net $91 million reduction in state funding.

As usual, Planning & Budgeting will continue to post budget updates throughout the 2011 Legislative Session on this blog. As we’ve stressed before, the Governor’s budget is the first budget proposal for the upcoming biennium; we have a long session before us and no budget is final at this point.

Are the States Alright?

You may have read a widely circulated today concerning the possibility of the federal government creating a pathway for states to seek protection in federal bankruptcy court if their debt burdens spiral out of control. Some policymakers think that the severe economic strain created by the Great Recession has revealed deep structural problems in state budgets that may be unfixable without intervention.

However, in , the Center on Budget and Policy Priorities puts current state budget woes in historical perspective, and emphasizes that, while the near-term future for state budgets across the country remains grim, we must exercise caution in conflating the short term problems caused by the recent recession with the very long term structural issues associated with revenue systems and pension plans.

A New Normal?

In , the National Association of State Budget Officers (NASBO) puts the Great Recession into context and discusses the cyclical nature of state funding for higher education, which has historically followed a pattern of major cuts in poor economic periods followed by generous reinvestment in good times.

Considering the generally of the speed of economic recovery for state budgets, NASBO asserts that this boom and bust funding pattern may finally be broken. Many do not expect state funding for public higher education to return to previous levels, and this has states, institutions, and other stakeholders wondering what a ‘new normal’ may look like.

Many institutions think that at least part of the answer lies in from state processes and requirements, and more flexibility in managing institutional resources. Whatever the outcomes, many are hoping that achieving a more stable and predictable funding model might keep public higher education on solid ground as we move toward an uncertain future.

How Other Campuses Plan: Sustainability as Part of Campus Planning

Welcome to two new topics on OPBlog: Campus Planning and Capital Resources as they relate to a unified approach to capital planning. We will begin posting on topics related to capital resources, capital budgets, campus planning, and national trends in those areas.聽 This first post looks at planning efforts in Portland and the role Universities play in urban planning.

A 2009 report by the Lincoln Institute of Land Policy titled 聽聽 reinforces ongoing research that suggests over the past 20 years universities play a much broader role in the economic, social, and physical development in their neighborhoods.聽 As universities continue to lead the urban planning process with their surrounding communities, the concept of EcoDistricts 鈥 planning for sustainability at a district level – may play an important role in the overall discussion of how a community develops.聽 In fact, in Portland, one of the pilot EcoDistricts is in partnership with Portland State University (PSU).聽

What are EcoDistricts? EcoDistricts are a comprehensive strategy developed by the Portland Sustainability Institute to accelerate sustainable neighborhood development. Through partnerships with the region, institutions, and businesses, Portland created the .聽 The institute “…brings together business, higher education, nonprofit and municipal leaders to drive a set of next generation urban sustainability initiatives for the Portland metro region.鈥澛 In essence, it is a not-for-profit that supports the coordination of multiple sustainability efforts to maximize outcomes.聽 It supports the planning of community initiatives at a district level rather than individual initiatives in hope that the district level planning will have a more significant impact.聽聽聽According to , a publication published by PoSI, sustainability is achieved over time.聽 鈥淚t鈥檚 not the product of a program, project, or initiative, though all these things are important and help.鈥 Portland, Oregon, has embarked on a path of sustainability through district-level planning not unlike campus planning. Although urban sustainability is not new, the approach Portland is taking is being explored as a model聽for other cities and universities.

Economist Emphasizes Continuing Value of College

Inside Higher Ed has published a long but excellent piece called by Anthony P. Carnevale, Director of the Georgetown University Center on Education and the Workforce.

If you have the time, check out the Center’s from last summer, which projects America’s workforce and educational needs for the coming years.

Supreme Court Decision on Medical Residents Upholds Status Quo

As reported by and many others, the Supreme Court decided this week that medical residents do not qualify for student payroll tax exemptions and must pay into social security and medicare as other employees do.

This ruling upholds U.S. Department of Treasury regulations issued in 2004, which the 91探花has been in compliance with since. Had the ruling gone the other way, medical residents across the country would have been reimbursed for taxes collected since 2005, and their institutions would have been able to cease collection in the future.