As state universities brace for $300 million one-time cut, they're on their own with tuition
The Senate and House completed Round 3 of higher education budget negotiations tonight, and have agreed on many of the most nettlesome issues.
Heading into Round 4 during an 8:30 a.m. meeting tomorrow, here's what the two chambers have agreed on so far.
* A $300 million one-time cut from the general revenue funds of the state's 11 universities. Although neither chamber has specified how those cuts will be spread across the system, the expectation is that universities would use reserve funds to cover the loss. It's unclear if that means the cuts will be comensurate in size to each reserve fund, meaning some schools will take more of a cut than others. Sen. JD Alexander sold the idea by depicting those reserves as uncommitted savings accounts. But representatives from universities say while money in reserves may not be committed to a specific line item, they are used for routine expenses such as summer school and ongoing research funding included in faculty hiring packages. The Senate has suggested $400 million in cuts. The House had suggested $200 million that would recur every year. The House agreed to one-time cuts, and the Senate agreed to a lower amount.
* No tuition increase approved by state lawmakers. The House had recommended an 8 percent tuition hike in its original budget. Now it has conferred with the Senate's plan for no "base" tuition hike, which could be spent on anything university administrators want to spend it on.
* Locally grown tuition increases of up to 15 percent. Both chambers agreed to leave it to universities to raise tuition to plug any holes left after the $300 million is taken out of the university system this year. Those hikes would need to be approved by each university's board of trustees, and then get subsequently approved by the Florida Board of Governors. Essentially, lawmakers are forcing the schools to take the political heat for tuition hikes. Another rub: the Legislature's budget factors in that the speculative 15 percent tuition hike, which assumes universities will seek the full amount. The 15 percent increase is allowed under a program called "tuition differential." The money from this type of tuition hike is spent in a much more restricted fashion. By state law, 70 percent of the revenue must be spent on undergraduate instruction, and 30 percent has to go to financial aid. None of it can be spent for other purposes, such as graduate courses or infrastructure. In addition, many students have their tuitions locked in at a certain rate for all four years. So of the estimated $159 million the universities could raise if they all raised tuition to the max, about $45 million would go uncollected because of these locked-in rates.
What the two chambers have not agreed on, yet, are the amendments filed by Sen. Jim Norman, R-Tampa. He helped quell the political firestom that came when Alexander proposed disproportional cuts that seemed to punish the University of South Florida for resisting his move to immediately split USF's Lakeland brand into the state's 12th university -- a move opposed by students and faculty. Norman got $10 million restored to help USF absore USF Polytechnic's faculty and staff (though USF estimates that will actually cost $16 million) and $3 million to cover USF's pharmacy program (though USF estimates it will cost $6 million). The upstart program was previously funded through USF Poly's budget -- which would go with the branch campus when it splits.
Although most of the other major issues have been settled, Norman's amendments have not come up yet in a House offer to the Senate. That leaves some wondering whether House Speaker Dean Cannon is holding on to the amendments as a chit to play for something else. Stay tuned.
-- Kim Wilmath and Michael Van Sickler, Times staff writers