The impact of a 2% budget cut

As part of the one-time budget reduction made by the Executive Appropriations Committee before the 2015 legislative session, all appropriations subcommittees were requested to identify a 2% cut to existing base budgets, including higher education.  The stated intent is to “stress test” areas of the state budget to help inform budget priorities for the upcoming fiscal year. A 2% budget cut to the higher education budget would be the equivalent to one of:

  • 227 fewer instructional staff
  • 1,814 fewer course sections available
  • 2,825 fewer full-time equivalent students funded at current levels
  • 2.5% tuition increase if made up with tuition.

USHE institutions are already dealing with significant bottlenecks in high impact courses, including STEM areas (Science, Technology, Engineering, and Math). A base budget reduction would likely adversely impact those areas further.

 Despite much-needed increases last year, higher education funding still lags.

Utah’s historical trend in state funding support for higher education is similar to the nation’s – relatively flat levels of state funding at a time of significant student growth. As with colleges and universities across the country, the result is an increased cost burden shifted to students. Historically, state funding support for higher education in Utah has helped mitigate that cost shift compared with other states. State funding for higher education in Utah has remained virtually unchanged when adjusted for inflation:

The need for funding higher education is amplified in Utah because of the growth in students that has occurred during the same time period, which is projected to continue.  Utah’s student growth has far outpaced most other states:

USHE colleges and universities already operate efficiently

Utah’s public colleges and universities are among the most efficient in the country. A solid measure of efficiency in any market is outputs. In higher education, degrees and awards are a central output of its services. USHE institutions award the 2nd highest number of degrees and awards per $100,000 spent in higher education (including both state funds and tuition). In other words, Utah is second in the nation in the fewest total dollars spent per degree in higher education. Students attending a USHE institution are getting one of the best deals in the country. Where the individual return on investment of a bachelor’s degree is a 60% increase in annual wages (compared with only a high school education), and the tax funds of Utahns devoted to higher education are among some of the lowest in the country, higher education provides one of the most significant contributions to the state’s economic growth and expansion.