Cuts stymie higher ed

By Jason Kosena

Talk to any of leader of a public university or college in Colorado. They all say their jobs are getting harder by the week.

When Gov. Bill Ritter’s budget team announced his plan to cut $823 million from the 2009-’10 fiscal year budget last month, everyone knew higher education would take a beating.

It did.

Included in Ritter’s proposal was a $100 million reduction in funding for the state’s higher education system — nearly 75 percent of the $120 million increase that Ritter had fought for since taking office. The cuts will take away the jobs of faculty and staff members in Greeley, Boulder, Denver and Fort Collins — home to the state’s largest four-year universities — and will force increases in tuition rates and student fees at a time when Colorado families can least afford them.

Because interlocking provisions of the state Constitution require increases to K-12 spending each year — while prohibiting the state from increasing the General Fund by more than 6 percent each year — higher education is often the easiest target when lawmakers are desperate for cuts.

Lawmakers were hoping for a large infusion of cash for higher education as a part of the economic stimulus package moving through Congress, but Senate leaders removed the provision in an attempt to make the bill more palatable to moderate Republicans and Blue Dog Democrats.

But the leaders of Colorado’s higher education system have grown weary of this game, and are searching for new funding solutions. Their suggestions include asking for less state oversight on spending and flirting with the concept of moving to a quasi-private model that would allow greater flexibility to raise tuition rates, among other proposals.

There’s talk — but nothing solid — about a possible ballot measure in November that would come to higher ed’s aid.

“I think the biggest challenge is not the specific cuts that have to be made this year — and I don’t say that to minimize them. But my biggest worry for Colorado is how do we solve this situation of higher education funding in the long run,” said Tony Frank, interim president at Colorado State University. “By solve it, I mean, ‘What is it going to mean to be a public higher education institution in the 21st century in Colorado?’”

Colorado’s 28 public colleges and universities already were on an unstable financial footing after the 2002 recession forced lawmakers to substantially cut their funding. Slowly, the higher education system was beginning to recover, and was starting to get back into the national competition for students and faculty.

Then came news of this year’s massive cuts.

Colorado ranks in the bottom 2 percent nationally in state funding to higher education and is estimated to have an annual shortfall $800 million when compared to peer universities.

So what can be done?

Higher education advocates suggest that providing more flexibility in how campuses are operated and spend money could help — and wouldn’t require additional state revenue. Such flexibility would allow administrators more efficient use of money that’s already designated for capital construction, financial aid or management operations, advocates said.

And, of course, they’d also like more flexibility in setting tuition rates without approval from the Joint Budget Committee.

“I told the (Colorado Commission on Higher Education) and the Joint Budget Committee that I think we should be doing things that give us more flexibility in the way the university operates,” said CU President Bruce Benson. “It’s not just about tuition, though. It’s flexibility across that board. We’ve talked a lot about capital construction, and I see there are ways to streamline and fund capital construction that we’re not able do now. We should be able to do that. We’re constructing a building now (that is being delayed). And all we’re asking is to let us loose to build the darn thing.”

The approach may not be dead — at least not completely.

In a round robin with reporters last month, JBC chair Sen. Moe Keller, D-Wheat Ridge, said she was open to examining the approach but balked at giving institutions the power to set their own tuition rates.

“I just worry that, if that were to happen, Colorado’s middle-class families would be priced out of higher education altogether,” Keller said at the time.

For good reason.

Between 2002 and 2005, funding for higher education was cut by nearly 22 percent, according to Joint Budget Committee data. At the same time, tuition rates rose by more than 30 percent — a trend that continued in proceeding years. In fact, since 2003, tuition at CSU has increased 52 percent, while mandatory student fees have risen by more than 70 percent. Students at CU and UNC have witnessed similar increases.

But administrators admit that — although no one likes to raise tuition — in the light of the state’s current budget crisis, it’s about the only available option.

“I worry a lot about tuition in this environment, and it’s a true statement that we can make up some of the cuts through tuition increases,” said CSU’s Frank, who added the state still offers relatively low tuition compared to peer states.

“But that doesn’t mean that you can put large tuition hikes onto the students and their families,” Frank said. “If it’s too large, we could drive people away from an affordable education. And that is what our mission is to provide.”

However, some Colorado university presidents believe the budget shortfall justifies a quasi-private model, through which the state would fund part of a university’s operation and higher tuition rates would pay for the rest. Continuing that reasoning, because families that can afford it are paying more for a public education, there also would be more revenue available for financial aid to assist families that cannot.

Frank said he thinks there’s an inherent risk to that model.

“I worry about that approach,” Frank said. “If we continue to go down that path, there will always be a group of people who are right above the financial aid level who will find it harder and harder to get a higher education.

“I really worry about the hybrid approach,” he continued. “I worry about using a private model and implementing dramatic tuition increases. It would really challenge the basic mission we have as a public school, which is to offer an affordable education to Colorado’s working families.”

Kay Norton, the president of the University of Northern Colorado, disagrees.

Norton, a former attorney for ConAgra Red Meats Company, said if the state is unable to fund higher education adequately, such other alternatives as a hybrid model should be considered, even if it means substantial tuition increases.

Calling the old funding system a remnant of the 19th Century, where the state offers a generous subsidy while keeping tuition rates low, Norton said Colorado has been moving toward a quasi-private model for two decades.

“In that old style, the tuition was generally regulated and expected to remain low and at the same price for everybody, while, on the other end, you had private institutions with much higher tuition, and they funded everything from that payment, including financial aid,” Norton said.

“Now, that doesn’t necessary mean the citizens of Colorado are priced out of an education as long as we can target financial aid and discounted prices to students who would otherwise be priced out,” she continued.

Norton said she understands that a private model isn’t ideal, but reiterated that — with the state’s current level of funding for higher education — Colorado must begin a serious conversation about what kind of higher education system it wants and needs. She also said that by offering financial aid to Colorado’s working families, the system could still remain accessible and open.

Whether or not financial aid is taken into consideration, opponents of the hybrid model say that higher tuition costs will burden many Colorado families and eliminate the possibility of college altogether for some. Furthermore, in the case of the CU system —which is governed by the state’s
Constitution — a statewide vote would be needed in order to approve any change.

“I don’t think that privatization is the way to go,” CU’s Benson said. “Financial aid is good, but what do you do about the guy who just barely doesn’t make the (financial aid) cut, but still can’t afford to go to CU?”

One alternative that Benson and some Colorado business leaders are exploring is a possible ballot measure that would secure higher education funding either through a referendum or a constitutional amendment. Benson acknowledged he is discussing such a plan with political and business leaders, including the Denver Metro Chamber of Commerce, but was vague on specifics.

“I have had several meetings with the business community.... We’re also talking with several legislators about it, and we’re actively pushing for and talking about what a solution would be,” Benson said. “I don’t know what those solutions will be right now. If I did, I would tell you. We’re talking about it, though.”

Time will tell what kind of measure, if any, comes from those discussions and whether its proponents will succeed with voters.

After all, even with bipartisan support and an expensive advertising campaign, Referendum C passed by a slim margin in 2005. Furthermore, higher ed funding gets less voter sympathy than funding for K-12 education, which is used much more broadly.

That makes it difficult to make a case for protecting higher education funding — a reality the university presidents don’t deny.

“I think it’s our public duty to be addressing what is appropriate in dealing with this issue, including whether to go to voters and ask them if there is a way to stabilize a funding commitment to higher education,” Norton said. “But what I am certain will not work is just telling people that we need it.

“Whining will not work. That is for sure.”