The New Economy: Colleges Wary of Loss of State Funding
February 9, 2009
By Michele Steinbacher - The Pantagraph
NORMAL -- Public campuses don’t know how the economic recovery might impact them, but officials at Heartland Community College and Illinois State University say they’re being proactive.
“We’ve been very conservative in our budget planning, and that continues,” said Steve Bragg, ISU business and finance chief. At nearby Heartland, the story is the same.
“The state, certainly, has been in our budget discussions. We’ve seen flat and declining state funding for several years, and at a time when enrollment is increasing,” said Rob Widmer, Heartland’s finance chief.
Heartland surpassed the 5,000-mark for enrollment this fall. It’s bracing for more: In hard economic times, community colleges tend to see spikes in enrollment, said Widmer.
All of Illinois’ public colleges need to wait until summer, and possibly fall, to learn Gov. Pat Quinn’s budget proposal. But it’s spring when campuses develop tentative 2010 budgets.
Both campuses also have building projects, but Widmer and Bragg said current woes haven’t directly affected those projects. At Heartland, the bids for its six-building, $60 million Phase II plan were locked in a few years ago, and paid with locally funded bonds.
At ISU, Bragg noted the campus’ $50 million student recreation center is mostly funded through student fees, while the academic portion used bank certificates of participation, a bonding formula. Bragg said the $23 million Stevenson/Turner halls upgrade is funded through the state’s Capitol Development Board; that funding already was secured by ISU. But the project’s contractors see delays in state payments, he said.
At ISU, roughly 25 percent of the campus’ annual funding, or $82 million, comes through the state. Financial concerns there mean a hiring freeze and finding ways to cut existing costs, said Bragg. When the state asked for a 2.5 percent return of ISU’s 2009 budget, it got $2.1 million. “We’re hoping we don’t get asked to give more back this year,” said Bragg.
Along the way, ISU works to keep the student-teacher ratio low among the 20,000-student campus, he said. That means tightening non-classroom spending.
Heartland administrators are developing their fiscal 2010 budget, said Widmer. As for 2009’s budget, announced last summer, the college also had a 2.5 percent rescission, about $85,000. And quarterly payments from the state also are lagging. Heartland’s funding comes from three main sources: the state, local property tax revenue, and tuition and fees.
On the minds of both financial planners is keeping the institutions affordable, a key part of public school missions. At ISU, Bragg said the campus has been pulling aside a fraction of tuition funds each year, setting those in a growing scholarship fund. At Heartland, a foundation has expanded scholarships. And this year, HCC students could apply for loans through that school.
ISU is part of the state’s truth-in-tuition rule that requires a locked-in rate for four years, but ISU takes it a step further and locks in fee rates four years as well. While community colleges aren’t required to lock in rates for multiple years, Heartland has voluntarily set tuition and fees for two-year increments to help families plan, said Widmer.