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Quest for Greater Autonomy for Public Higher Ed Continues

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As state legislative season wears on, here is an update on some of the efforts in other states to achieve greater financial and regulatory freedom for public higher education institutions facing another year of steep budget cuts.

  • Virginia: The legislature passed the Virginia Higher Education Opportunity Act of 2011. For details on the major aims of this legislation, see our earlier post. The State Council of Higher Education for Virgina (SCHEV) provides an overview of how the final bill differs from the original bill, including, among other things, the addition of a goal to recognize the unique missions and contributions of different institutions.The Act now awaits the signature of the Governor, who proposed the initial bill.
  • New York:  The Legislature passed a budget that did not include provisions contained in the Public Higher Education Empowerment and Innovation Act proposed by the SUNY system. The Act sought increased autonomy from state processes and freedom in managing institutional resources, especially in light of significant budget cuts since 2008. The state not only decided to include none of the flexibility measures, but hit the system with another $210 million in cuts. Having lost 30 percent of its state funding in three years, this huge network of over 60 campuses is determined to continue fighting to maintain access and quality.
  • Wisconsin: The New Badger Partnership proposed by UW Madison continues to be controversial in Wisconsin. Feeling left behind by the proposal to ‘set free’ the flagship institution, the UW System Regents have endorsed their own proposal, the Wisconsin Idea Partnership, which includes freedoms and flexibilities for all system campuses. The Legislature will consider both proposals in the coming month.
  • Oregon: University of Oregon President Richard Lariviere has made an agreement with Governor John Kitzhaber to put the University’s ‘New Partnership’ legislation on hold for a year in favor of supporting passage of the Governor’s legislation, which creates an independent public university system in place of treating each institution as a  state agency. In exchange, the Governor has signaled an intention to support the University of Oregon’s New Partnership proposal for greater autonomy, including a new financing structure that replaces annual state operating support with a public endowment, in the 2012 Legislative session.

Note that the Washington State Legislature is also currently considering a number of proposals, both large and small, that might lead to regulatory relief and increased autonomy of varying types for the UW. Check out the bills that the UW ‘strongly supports’ and ‘supports’ in the BillTracker for more information on some of these bills.

Finally, House Operating and Capital Budget Details

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The House released operating and capital budgets yesterday for the upcoming biennium (FY12 & FY13). This budget is an important next step in the budget development process in Olympia but we are far from having a final compromise budget.

The House operating budget proposal:

  • Cuts state funding for the UW by $204 million over two years (32% reduction)
  • Authorizes resident undergraduate tuition rate increases of 13% for both years
  • Eliminates the State Work Study Program
  • Increases the State Need Grant to adjust for increased tuition rates
  • Mandates reductions equivalent to a 3% salary reduction

The House capital budget:

  • Authorizes state funds for the Odegaard Undergraduate Learning Center renovation
  • Provides some state funds for some minor capital repairs, the House of Knowledge, UW Seattle’s High Voltage Infrastructure Improvement project, and design-phase funding for Anderson Hall

Please read our comprehensive brief about the budgets and please post any questions or comments to the blog.

Western Governor’s University: WA House Bill 1822

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This is the first in a series of blog posts that presents a Washington State Legislative bill that we are tracking and provides more information about what the bill does and why it is relevant to the UW.

As the demand for higher education increases, especially among students who are place-bound or have outside commitments that prohibit them from pursuing a traditional college education, online learning has become more and more popular. While some universities use limited online classes to ease overfilled classrooms or offer introductory classes more cheaply, some students study exclusively online.

House Bill 1822, “Establishing the first nonprofit online university,” seeks to partner the state with Western Governor’s University (WGU), a non-profit, online university, creating WGU-Washington. The bill has passed out of the House, was passed by the Higher Education and Workforce Development committee in the Senate, and has been passed to the Rules committee for second reading.

The new WGU-Washington would not receive any state funds, nor would its students be eligible for state financial aid like the State Need Grant; however, supporters of the bill purport that projected increases in the demand for postsecondary education combined with future labor force requirements are such that increased degree production in the state is crucial. Proponents see a partnership with WGU as a resource for Washington citizens and employers that does not require a large investment of state funds. The bill also seeks to make it easier for students to transfer credits between WGU and the “traditional” state institutions of higher education.

While some questioned the necessity of the bill at the Senate hearing, pointing to the fact that Washington students can already enroll at WGU independently, and that the state’s community colleges may be better options for such students, others maintained that Washington’s existing  institutions are overenrolled and that WGU offered a low-cost alternative to private for-profit online universities. Other critics pointed to the lack of data available on WGU programs, processes and outcomes as an indication that a WGU education may not meet the standards of the other institutions in the state.

WGU was chartered in 1996, and endorsed by the 19 Governors of the “Member States,” including former Governor Locke. It offers bachelor’s and master’s programs in the fields of education, information technology, health professions, and business. Basic tuition for a six-month terms is $2,890, though some program fees lead to a higher total cost. The institution currently enrolls 23,000 students all over the United States. Instead of a traditional classroom where a faculty member who is a subject matter expert teaches the material, WGU students are led through a competency-based curriculum that is developed by faculty mentors (who generally hold terminal degrees) and facilitated by student mentors and course mentors, most of whom have earned a graduate degree (although WGU does not provide an exhaustive list of faculty mentors or of student and/or course mentors). WGU asserts that the vast majority of alumni and their subsequent employers are pleased with their university experience, and feel they are competitive in the workforce.

Wherefore art thou, House Operating Budget?

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When the revenue forecast was released on March 17, House fiscal leadership indicated that their operating budget would be delayed. We hoped to see a budget on March 21st and then on March 29th. Tomorrow is April 1 and your analysts at OPBlog anticipate having neither budget drafts to write about nor fantastic prank ideas to implement.

Some news outlets indicate that we may see the House Ways and Means Operating Budget next week. Meanwhile, Senate Ways and Means chair Ed Murray, D-Seattle, is on record saying that the Senate will not release its budget until the House releases theirs.

We’ll offer full analysis of the budgets as they are released. Stay tuned!

Planning for Urbanization

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In 43 years, the world’s population is expected to double.  In developing countries the urban population is expected to double between 2000 and 2030.  The urban land cover will double in 19 years and the built-up area of major cities in the developing world will triple.  At least, this is according to a new report, “Making Room for a Planet of Cities,” that was published by The Lincoln Institute of Land Policy last month.

For the past five years, a team of researchers looked at GIS-based maps, satellite images, and historical maps to create a comprehensive data set to look at five key attributes of urbanism – urban land cover, density as measured by population in relation to built-up areas, centrality (distance from city center), fragmentation (the amount of open space within cities), and compactness. The summary from all of the historical research: “average densities declined as population and wealth grew, not just in the U.S. as part of the familiar pattern of sprawl but worldwide.”

Looking to the future, the research conducted by this report suggests that planners and policy makers should look at growth management within the context of the following: realistic projections of urban land needs, selective protection of open space, generous metropolitan limits, and infrastructure to support mass transportation.

As a planner at the University of Washington, this emphasizes the importance of the University’s location in an urban center.  Assuming that increased urbanization will continue, as suggested in the report, the University District area is on track for increased density.  This makes the report timely in its reinforcement of the growing importance of planning for the future using realistic projections, protection of open space, and an emphasis on infrastructure prior to significant urban growth.

Report Confirms Deep Cuts to Higher Ed Across US

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The SHEEO State Higher Education Finance report for FY 2010 was released last week. Unsurprisingly, it confirms that the same general pattern in Washington of deep state cuts to higher education funding coupled with steep tuition increases is being replicated in states across the US.

Report Highlights: National Trends

Nationally, on average, state support for public high education per full-time-equivalent (FTE) student declined by about 7 percent between 2009 and 2010, and, at $6,454 per student, is at its lowest level in 25 years. The reports notes that average increases in net tuition revenue of 3.4 percent per student partially offset these budget cuts.

These cuts comes at a time when enrollment continues to grow partly due to more citizens seeking out higher education during the economic crisis. Nationally, enrollment grew by 15 percent between 2005 and 2010. Even when state and federal and increased tuition support manage to stay whole or increase, the report notes that increasing enrollments continue to erode per student funding levels over time.

The report highlights the importance that state support continues to play in education related spending by public institutions even as tuition revenue rises. They acknowledge that this importance is sometimes obscured by the complex finances of large institutions that have many other (non-fungible) funding sources.

Ultimately, SHEEO purports that public and policymaker values are consistent with continued public support for higher education, and they are hopeful that investment will rise again once state budgets stabilize and improve.

Report Highlights: Washington State

SHEEO presents the following averages for Washington State higher education for the 2005-2010 period:

  • 12th in increased enrollment in public higher education (19.2%).
  • 30th in appropriations per FTE.
  • 40th in percent of net tuition revenue as percent of total education revenue.
  • 40th in total educational revenue per FTE.

These numbers are a testament to the comparatively low tuition rates enjoyed by WA residents combined with lower than average state appropriations.

Read the full report for more data, analysis, and methodological details.

New UW Website Centralizes Budget Information

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You might notice links for a new website, UW Budget Watch, popping up on UW homepages (including OPB and right here on the blog).

OPB worked with Web Communications staff to develop one website that would consolidate many sources of information relating to the state budget and how it has and is expected to continue affecting the University. You will find links to blogs (the absolute best way to get the most up to the date and timely notices) and other UW and non-UW websites, as well as many educational documents, messages about the budget from UW leadership, videos about the current funding situation, and information about related UW initiatives.

We have found sites such as this very helpful in keeping up to date with our peer institutions, and we hope that our page will be as useful for anyone interested in keeping up on the latest developments.

So, visit the page often and we will work hard to keep it updated!

March Revenue Forecast Reduces WA General Fund Budget by $698 million

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State Economic Forecast Council Director Dr. Arun Raha released the March revenue forecast today. This forecast serves as the revenue basis for the Legislature’s general fund budget in the 2011-13 biennium (FY12 and FY13).

2009-11 Biennium (FY10 & FY11)

While many economic indicators used in his analysis show tentative growth in 2011, revenue collections through March 10, 2011 were $85 million below expectations and growth through the next quarter will continue to lag expectations, contributing to an additional $80 million deficit in the 2009-11 biennium. Legislative leadership confirmed that an additional (fourth) supplemental budget will be needed to reconcile the new FY11 shortfall. The timing of that budget is unknown.

2011-13 (FY12 & FY13)

Weaker growth in several key sectors over the last three months prompted Dr. Raha to increase the projected deficit for the 2011-13 biennium by $698 million.  The Legislature will use a $31.9 billion revenue base for the General Fund State. For comparison, the Governor’s December budget was based on a $32.1 billion general fund state budget.  

While we anticipate the House will release their operating budget proposal next week, House leadership did not commit to a date.

The March forecast includes new data about the downside risks to our economy including the earthquake, tsunami, and risk of nuclear meltdown in Japan. Further, Dr. Raha states that the most significant threat to economic growth is the energy market.  He fears escalating gas prices will continue to erode consumer confidence, regardless of job growth. These downside risk factors overwhelm any upside risks (employment growth, consumer confidence, and commodity prices) by 10 percent.

Please check this blog regularly for state budget updates as they become available.