State Relations

October 28, 2008

Tough Times in the Nation’s “Sunshine” States

While Washington State contemplates how to dig itself out of a projected three plus billion budget hole for next biennium, three of the nation’s sunshine states continue to experience even more dire budget situations which are already having severe impacts on those state’s higher education systems.

In California, what Sacramento Bee columnist Dan Walters calls the recently enacted “smoke and mirrors” budget has already collapsed like a house of cards and Governor Arnold Schwarzenegger is forced to call the legislature back into session next week to fix a six week old budget which is already $10 billion out of balance.  Just last week, University of California (UC) officials cancelled cost of living or merit based pay increases for all faculty and staff this year.  Contributions to the UC retirement system are also scheduled to increase due to declining investment returns — the first time in two decades contributions have been necessary.  Further reductions are in the works which could be in the range of 10 percent depending on the outcome of the next budget balancing legislative session.

The Arizona Republic reported today that Arizona State University (ASU) is preparing to lay off 200 or more faculty associates and dramatically boost some class sizes next spring as it prepares for more budget reductions.  Some lecture style classes could jump from 300 to 1,000 students.  These actions come as ASU prepares for an additional $25 million in state budget reductions on top of the $30 million in cuts the university has alread made in the past year.  ASU officials have no plans at this point to reduce enrollment or eliminate any majors.

In Florida, the gloomy state economy is continuing to create a lot of uncertainty for public colleges and universities which had to take major budget cuts in the most recently enacted state budget.  Florida’s private colleges are nervous, worried about declining returns on private endowments as a result of the turmoil in the financial markets.  Less money for private schools means many students will turn back to public universities for their education, but many Florida schools have had to freeze enrollments the past few years to cope with budget cuts.

One can’t help but wonder how prophetic these reports may be for the future of higher education in Washington.