Forsee looks for ways to save money system-wide
The credit crisis has caused the institutions to lose funding.
Jan. 23, 2009
As the state budget deficit has risen to more than $340 million, the state has asked its public colleges to look for places to decrease the amount of state money they need, while the colleges have been fighting to make sure those cuts aren't disproportionate to other sources of state revenue.
Economic hard times have already put in jeopardy university funding for building improvements. Last year, the Missouri Higher Education Loan Authority, the state's student loan agency, lost $12.4 million, the first time it posted a loss in its 27-year history, largely due to the credit crunch after the subprime mortgage crisis. MOHELA originally intended to generate profits that could be used to finance construction projects without raising the state's budgetary commitments.
On Dec. 12, UM system officials created an Economic Development and Research Council to pool research resources between the four campuses to keep research going even with budget cuts looming. "We're committed to being part of the state's solution to today's tough financial environment," UM system President Gary Forsee said. "We need to innovate our way forward, and we're uniquely positioned to do so by providing career-advancing courses to people in Missouri jobs."
Forsee and university presidents from several state colleges met with then-Gov.-elect Jay Nixon on Dec. 16 to ask him not to cut state money to schools by as much as 25 percent, as has been predicted by some scenarios.
Nixon made education funding a key part of his campaign, proposing a $61 million expansion of the state's A+ Schools Program to increase the number of scholarships available to Missouri high school graduates who attend community college. Though state republicans and democrats both supported the concept of the proposal, the budget deficit decreases the likelihood the General Assembly will consider it.
In a Dec. 18 letter to the Missouri Department of Higher Education, Forsee outlined areas in the MU budget where cuts could be made to reduce state funding to the school by 15-25 percent, but warned that making deep cuts could create "a significant negative effect felt by citizens across our state."
The Department of Higher Education then forwarded recommendations from the reports put out by MU and other state colleges to the General Assembly. In a news release, the department said most schools had forecast larger class sizes, fewer experienced faculty and possible tuition increases to meet the 15-25 percent target for cuts in their budgets.
Paul Wagner, deputy commissioner of higher education, said decreasing the amount of state money given to schools with growing enrollments would likely reduce the value of their education.
"Enrollment statewide has increased by 15,000 students while institutions have been financially squeezed to maintain the same levels of academic quality," Wagner said. "I think, if the cuts are made, Missouri will slip even farther behind other states."
MDHE Commissioner Robert Stein said schools had been receiving state appropriations barely above the levels of 2001-2002, the last time an economic crisis forced budget cuts, and had been making steady progress in using the money efficiently before this recession.
"Institutions made great strides in improving efficiencies during the last six years," Stein said. "Higher education continues to look for ways to reduce costs and to restructure based on the conditions of the state and national economy. A repeat of 2002, when their cuts were disproportionate to the rest of general revenue reductions, would be detrimental to Missouri's future."