Monday, September 1, 2014

Get a Grip, Regents

By Duane Goossen

I was struck by the recent comment of a University of Kansas official: “Flat is the new up.” He was referring to state funding for Kansas higher education, and the now diminished hope for what the state can provide.

He’s right, of course. Flat funding is the best that the Kansas higher education system can expect. But even that has become a high bar and an unlikely outcome.

Current state financial policies have placed resources for kindergarten through 12th grade education in severe jeopardy, but post-secondary education is even more vulnerable. Look where things are now:

In actual dollars, state funding for higher education reached a high in fiscal year (FY) 2008, then took a big hit during the Great Recession and has floundered since. As the chart shows, support goes up $28 million in the approved FY 2015 budget, but before getting too excited about that, consider that the FY 2015 amount — $794.1 million — is $35 million less than 7 years earlier.

Is the FY 2015 appropriation even realistic? Can state support grow enough to get back to where it once was?

Revenue to the State General Fund has been reduced so severely that spending in the approved FY 2015 state budget is $351 million above expected income. If revenue comes in as estimated, the SGF can just barely stay solvent by using up the remaining balance in the state bank account. However, the official revenue estimate was completed last April with incomplete information and is far too optimistic. A much more likely scenario requires current fiscal year spending cuts.

For FY 2016 and beyond, the state faces a situation in which the revenue stream will be hundreds of millions below current spending levels. Unavoidable expenses like Medicaid will continue to rise, even as more income tax rate reductions take effect and further restrict revenue.

State finances are badly out of balance. Something will have to give way.

Get a grip, Regents! You are headed down a rocky path. The current set of state policies has made your state support anemic, and will hurt higher education even more in future budgets.

Watch out, students and parents! The direct result of declining state support is higher tuition and more fees. That’s been happening, and it will get worse.

Brace yourselves, Kansans! We have had a higher education system that we can be proud of, but that won’t last if we do not nurture and invest in it.

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