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Strategic Budget Advisory Committee (SBAC)
Strategic Budget Advisory Committee

Proposed Cuts Rattle CSU Officials

Lawmakers to consider $430M cut to higher ed, $85M to CSU

BY TREVOR HUGHES - The Coloradoan

April 04, 2009

CSU administrators are shocked by a proposal being considered by state lawmakers that could cut higher education funding by $430 million next year.

The cuts, endorsed by the Legislature's Joint Budget Committee and set for broader legislative debate next week, could lop $85 million off the current budget at Colorado State University. Lawmakers are struggling to close a massive budget gap caused by falling tax collections.

CSU officials had been bracing for cuts that were already likely to force furloughs and have forced layoffs at Larimer County's largest employer. The new cuts, if implemented, would be far deeper than expected.

"There's almost no way to react to it," said CSU system CFO Rich Schwiegert. "It's a lot worse than I expected. I'm a little amazed that anybody would vote for cuts this deep in higher ed."

He added: "(This) will be a very, very long conversation within our organization on to how to deal with that."

The funding cut is not set in stone. It is still a recommendation made by the Joint Budget Committee and must be formally debated by lawmakers before heading to Gov. Bill Ritter for his review. That process is expected to take several more weeks.

The JBC backs a bill to take $500 million from workers-compensation insurer Pinnacol's reserves and leave it with $198 million, or $85 million more than regulators require. That money would be funneled to higher education.

Lawmakers argue that since the Legislature created Pinnacol - even though it is not an arm of the government - they have the right to take money from its reserves, built up from premiums paid by businesses.

Without that money, committee members say, the state's colleges and universities will lose $300 million next fiscal year, or about half their budget. They also would lose about $130 million in federal stimulus money, raising the possibility some schools, particularly community colleges, might have to shut down or drastically downsize.

"It's devastating to community colleges," said Nancy McCallin, president of the Colorado Community College System, which serves 107,000 students at 13 colleges over 30 campuses. "People need to realize what will happen."

McCallin said the cuts would be so deep that community colleges would face raising tuition 65 to 70 percent, pricing out the students they aim to serve. She said colleges would likely have to scale back programs, especially expensive ones such as nursing or paramedic training.

Schwiegert said he expects students and administrators from the Fort Collins campus to visit with lawmakers next week to press their case for alternatives.

"Our board has not had a single conversation about what that does, what this means. We're hopeful that the elected officials are not serious about this level of base cuts to higher ed," he said. "I've never seen any like this."

CSU-Fort Collins interim President Tony Frank said he hopes and believes lawmakers will find a better solution.

"We all know there are going to have to be cuts," Frank said. "I would have hoped we could have found a more balanced way of taking the cuts across a variety of state agencies."

Frank said he believes the Legislature will ultimately reject a proposal effectively privatizing public higher education and said he hopes the severe cuts being faced by CSU will be enough to force a discussion about a steady revenue stream.

University administrators across Colorado for the past several years have been trying to build support from some sort of ballot measure that would dedicate a stream of money toward higher education, sparing it from the annual budget fights in the Legislature.