Financial Outlook Likely Spells Flat Funds for Higher Education

St. Louis — The Coordinating Board for Higher Education (CBHE) today approved a budget recommendation that seeks to maintain last year's funding levels for Missouri's public colleges and universities for fiscal year 2011. This request is in line with the instructions given by the state budget director indicating that, due to state revenue shortfalls, requests for new funding will only be considered if corresponding cuts from the same budget area are presented.

Last year's CBHE budget recommendation called for a 7.4 percent increase to address Missouri's rank of 47th in the nation in per capita funding for higher education. The state's revenue shortfall prevented that increase from being approved, however. Instead, public institutions agreed to forego tuition hikes in exchange for support consistent with the previous year. Federal stimulus funds were used to replace some lost general revenue and maintain the level funding.

The total fiscal year 2011 request is $961 million, equal to the current year's state support, according to Deputy Commissioner of Higher Education Paul Wagner, who oversees budget issues for the Missouri Department of Higher Education.

The board also approved a list of priorities for capital improvements at public colleges and universities. Uncompleted projects that were approved in 2007 as part of the Lewis and Clark Discovery Initiative but remain unfunded top the recommendation, followed by a ranked list of each institution's top building priority.

"A backlog of construction needs, flat funding and growing enrollment are putting stress on institutions at a time when their services are more important than ever," Wagner says. "Although it's very unlikely that additional state funds will be available, we thought it prudent to also provide information — an 'alternative' budget — about the very real needs of Missouri higher education."

A budget that would help meet the needs of higher education, should the funds become available, would provide a 4.4 percent increase in institutions' base budgets to pay for rising costs of employee benefits such as health care, minimum cost-of-living increases, scholarships, utilities and other operating costs, Wagner says. It would also contain a 3 percent increase to help accommodate enrollment increases, offer competitive salaries, and maintain affordability.

The alternative recommendation also calls for an amount equal to 1.5 percent of each institution's facility replacement value to address maintenance and equipment needs that have been deferred due to budget constraints.

The budget approved by the CBHE also requests state student financial aid levels consistent with last year's funding. Access Missouri, the state's largest need-based scholarship fund, has already seen award amounts reduced by 22 percent to accommodate more qualified applicants with the funding available. Bright Flight, the scholarship program that rewards high-achieving Missouri students, was scheduled by statute to increase from $2,000 to $4,000 for students who score in the top 3 percent of the SAT or ACT and add a $1,000 award for students in the fourth and fifth percentiles.

Wagner says Access Missouri needs to grow by $7 million to restore full awards to qualified applicants. Without a $17 million funding increase for Bright Flight, that program will spread existing funds among the 9,000 qualified students instead of increasing the award as called for in the new law.

Two scholarship funds created by the state legislature in 2008 also remain unfunded. The War Veterans' Survivor Grant Program ($281,250) and the Missouri Returning Heroes' Education Act ($841,143) cannot be funded unless additional revenues become available.

###