Lawmakers fear state budget cuts forced UConn tuition hike

Defending a plan to collect an extra $50 million per year from students by 2016, University of Connecticut officials said Monday that represents the cost of adding nearly 300 faculty.

But another way of describing the extra student costs is that they also match a hole punched into UConn finances in recent months by Gov. Dannel P. Malloy and the legislature.

And since UConn has saved enough money to cover the teacher positions through an efficiency effort launched in 2010, key legislators questioned Tuesday whether the tuition hike was needed to expand faculty, or to help balance the state budget?

“There’s definitely a cost-shift going on, and it’s the type that hits middle class families the most,” said Rep. Roberta Willis, D-Salisbury, co-chairwoman of the Higher Education Committee. “Our public institutions are becoming private institutions (because of their costs), and it’s tragic.”

“UConn has needs that have been short-changed by the state and that’s why they need to raise the money to fill out their (academic) programs,” said Rep. Pamela Z. Sawyer, R-Bolton, a member of the Higher Education Committee and past president of the UConn Parents Association.

But Malloy’s budget director, Office of Policy and Management Secretary Benjamin Barnes, said the sacrifices imposed on UConn “were comparable to what the rest of state government took” as the administration closed the $3.7 billion deficit it inherited. That shortfall also was closed with about $1.5 billion in new state taxes.

Barnes also said that the ability of UConn and other public colleges and universities to offset state funding cuts by increasing fees doesn’t make them a popular target for the budget axe. “Higher education is a significant part of the administration’s economic development strategy,” he said. “A high quality system is key to the economic success of any jurisdiction, to make it a great place to work and live.”

To make UConn a great place to learn, university officials said, a growing student-teacher ratio that has topped 18-to-1 has to be lowered.

Trustees’ actions

Toward that end, UConn’s Board of Trustees endorsed two options Monday.

Overall tuition would grow 26 percent beyond current levels by 2016 — unless the state fails to fund mandated pay increases when a wage freeze is lifted 18 months from now.

In that case, the tuition increase will reach 28 percent over four years.

And under either scenario, food service and undergraduate housing costs would rise 3 percent or 4 percent annually.

According to UConn officials, these increases would cover between 73 percent and 80 percent of the cost of adding 290 faculty, providing between $50 million and $53 million of the $66.5 million additional annual cost by 2016.

But both Willis and Sawyer noted that $50 million gap is very familiar to another that recently popped up in UConn finances.

State support for university operations fell $45 million in the fiscal year that began in July, from $329 million in 2010-11 to $284.2 million now.

That includes a $27 million cut built into the original budget, and nearly $18 million extra held back from UConn since July. The latter is UConn’s share of a $700 million savings target that must be achieved across state government from a union concessions deal that froze wages for two years, changed retirement and health benefits and ordered other cutbacks.

The union deal is particularly controversial among Republican lawmakers, who say some aspects of it haven’t saved as much as promised, and that the Democratic governor is assigning extra budget cuts to some agencies to compensate.

For example, three labor-management panels were supposed to identify various efficiencies across state government to save $170 million this year alone. But two of the three panels hadn’t even met until the fiscal year already was nearly four months old. Rather than wait, the administration drew up its own blueprint in October, assigning each agency a share — regardless of whether these panels recommend any efficiency strategies.

So if students pay more to offset UConn’s $18 million concession cut, does that translate into more efficient government — at least in the language of the state budget?

An ‘easy place’ to cut

“That is the fiscal nightmare we face,” Sawyer said. The administration is “trying to collect an efficiency savings that was supposed to be realized by a committee that hasn’t identified any. All we have really done is reduced state support for the university’s programs.”

Willis added that higher education is a popular target for budget cuts because, unlike state agencies, public colleges and universities can avoid eliminating programs or staff by raising fees. “Higher education is an easy place to go politically,” she said. “And we see that happen not just here, but nationally.”

In Connecticut, state government currently covers less than 30 percent of UConn’s annual operating costs. In 1990, state funds represented more than 44 percent.

But Barnes responded that charges of UConn being unfairly targeted are false. Though the efficiency panels started late, UConn and other higher education units have other options besides raising tuition. “They have not been functioning at perfect efficiency,” he said.

‘Tried to be fair’

Barnes also noted that UConn’s concessions cut also reflects savings the university enjoyed from the wage freeze, benefits changes and through a flurry of retirements, particularly among veteran, higher-paid staff. “We’ve tried to be as fair as possible.”

The university did launch its own efficiency effort in 2010, hiring McKinsey & Co., a global management consulting firm, to both streamline operations and identify new options to raise revenues outside of tuition hikes.

The firm issued a report last month recommending potential annual savings worth as much as $67 million.

UConn President Susan Herbst said Tuesday that she believes with this report, savings already found in equipment, technology, student affairs and academic and non-academic support programs, and new strategies to improve private fundraising, the university can absorb the latest loss in state funds.

But it couldn’t do that and move forward with the faculty initiative.

“None of this is ideal, but I can’t tell you how many university plans across the country have been slimmed back” or changed because of reductions in state assistance, she said.

“All we can do for the moment, as we see it, is try to plan to move forward,” she said. “That’s what we have done.”