While debate continues at the Legislature over state funding for higher education, an important editorial appeared earlier this week in The Town Talk calling for "deep focus" on reform, starting with an examination of a current "business model that is built on incentives to spend, inherent redundancies, [and] fractured oversight."
The editorial begins by pointing out that such a focus is needed not from the viewpoint of an opponent of higher education, but precisely as an expression of support for it:
Faithful readers also know that our support for education is framed with expectations -- including quality, relevance and effectiveness -- and the objective measurement of each.
That, we suggest, is the appropriate context for the much-needed discussion taking place in Louisiana regarding the costs of public higher education.
The newspaper then does just that, citing a recent study on the rising costs of college nationwide, to provide context and perspective on the situation in Louisiana:
Gov. Bobby Jindal has thrown down the gauntlet. Jindal, a respected academic and an authority on the business of higher education, has forced state legislators to start talking about this by calling for $218 million in cuts to higher education to balance the 2009-10 budget.
The cuts, by necessity, will touch all four publicly funded systems: Louisiana State University, the University of Louisiana, Southern University and the Community and Technical College System. That there are four tax-supported systems in any state -- let alone one with a declining population -- suggests the scope of the challenges. Duplication of services, redundant programs, and intra-system inefficiencies dilute the effectiveness of education dollars.
That should be addressed head on.
The entire editorial is very much worth reading.
Funding reductions in perspective
However, the emphasis on reform, efficiency, and effectiveness in the editorial has sometimes been absent from the current debate, in which proposed spending reductions for higher education have been labeled "draconian." The figures seem to belie that characterization.
The total recommended budget for Higher Education in the FY 10 Executive Budget was $2.638 billion, a reduction of $219 million, or 7.7 percent, from the $2.857 billion existing operating budget for FY 09.
Through amendment, the House added $24.1 million total means of financing for Higher Education. They also added $50 million in contingency funding from the tax amnesty, as well as $2.3 million in contingency funding from the Insure Louisiana Incentive Program Fund. Also, it is estimated that tuition increases will bring an additional $33.6 million to Higher Education's funding.
All together, these actions would add $110 million to the Higher Education budget – and lessen their total funding reduction to $109 million, or 3.8 percent from the FY 09 existing operating budget.
One would think that, with the emphasis on reform, efficiency, and effectiveness called for in the editorial, a 3.8 percent reduction might be managed without "draconian" consequences.
Now, since the House acted, questions have been raised about whether the $50 million from the tax amnesty could actually be put toward higher education operating budgets, and another option has been floated to use the state's Rainy Day fund for higher education, then use the tax amnesty dollars to replenish, and satisfy a glitch in, the Rainy Day fund.
As an Advocate story noted yesterday, while the Governor "is studying" such suggestions, he is also keeping his emphasis on preparing "for a leaner future":
Jindal said he is wary of using one-time money to fill a budget hole that he expects to reappear for several years to come.
He said higher education needs to develop a plan to readjust once the dollars are gone.
History of higher education spending increases
More perspective on the current debate might also be gained through an appreciation of the historical trends in Louisiana higher education funding.
According to Illinois State University's Center for the Study of Education Policy, a survey of state taxpayer support (including General Fund direct and Statutory Dedications) for higher education shows:
- Over the ten years between FY 99 and FY 09, state taxpayer support for higher education in Louisiana grew by 99.7 percent.
- That represents the 3rd highest state spending growth rate for higher education in the nation over the last ten years, behind only Wyoming (124.5 percent) and Nevada (116.3 percent).
Also, according to the same research center, as of FY 08, Louisiana ranked 8th in the nation for per capita state taxpayer-supported spending for higher education.
Meanwhile, turning to the amount of actual total annual funding for higher education (and excluding any funding for LSU hospitals) compared to enrollment figures of students served in the state, we find the following:
| Year |
Total Funding |
Students |
| FY09 |
$2.398 billion |
207,335 |
| FY06 |
$2.001 billion |
183,914 |
| FY05 |
$1.965 billion |
214,144 |
What this shows is that while student enrollment understandably fell off following Hurricanes Katrina and Rita, and though gradually increasing since, funding continued to grow at a historically high rate.
Also, even though the total number of students served in the current fiscal year (FY 09) is 6,809 fewer than the enrollment highpoint reached in FY 05, total funding for Higher Education for FY 09 (not including hospital funds) is $423.4 million higher than in FY 05.
It also means that the total recommended budget of $2.200 billion for Higher Education in the FY 10 Executive Budget (again, not including hospital funds), is actually $234.3 million more than in the peak enrollment year of FY 05.
As the Town Talk editorial concludes, if we start with an in-depth examination of the "business model," then "reasonable people will find solution."
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