Is Jindal’s budget the death knell of La. higher ed.?

30th March 2015   ·   0 Comments

By Kari Dequine Harden
Contributing Writer

If legislators don’t find a way in the next session to offset at least some of Gov. Piyush Jindal’s ruthless slashing of the state’s higher education budget, the outlook is dire.

F. King Alexander, chancellor and president of Louisiana State University (LSU), spoke last week at a luncheon in New Orleans as part of an anxious outreach effort to increase awareness about the precarious situation at hand.

In a February 6 article, The New York Times reported that Louisiana’s higher education budget “has been slashed by more than just about any other state since 2008.”

Facing a $1.6 billion deficit, higher education is a primary target (an unprotected expenditure) as lawmakers address their constitutionally mandated responsibility to balance the budget.

“Right now, we are saying don’t panic,” Alexander said. “As the legislative session moves on, we’ll tell you when to panic.”

Basically, Louisiana lost revenue but hasn’t decreased spending at the same rate revenue was lost, said University of New Orleans (UNO) Political Science Professor Edward Chervenak.

Jindal’s bigger vision is to “privatize everything,” said Chervenak, as seen already with K-12 education in New Orleans, and health care statewide. Chervenak is also the director of the UNO Survey Research Center.

At the luncheon, Alexander handed out an information sheet listing the approximately 40 different state­wide factions under the state’s public university systems. The first column shows the institution’s existing operating budget for the 2015 Fiscal Year. The second shows the recommended budget for FY 2016 — a decrease of an average of 82 percent nearly across the board. The third column shows 2016 budgets including $372 million in supplemental funding.

With the additional funding, the cuts will be a reduction of about 30 percent from the previous year’s budget — still major, but not the drastic future laid out in the 82 percent scenario.

Alexander called the current situation “disheartening and disconcerting,” and said that they have to be able to plan for the future. “The numbers are so large, I don’t know how we are going to get there,” he said.

The mitigation—that would keep cuts closer the 30 percent end — could come in the form of increased “sin” taxes — such as on cigarettes or gambling tax, and proposed legislation that converts specific refundable tax credits into nonrefundable tax credits.

Alexander spoke to the economic impact the LSU system has on the state and specifically on New Orleans. He pointed to the 31,000 LSU graduates in New Orleans, and the impact of the Health Sciences Center and School of Dentistry.

Statewide, he described LSU as a “$4 billion economic engine.”

The LSU Ag Centers, Alexander described, exist in every parish and assist people with everything from fungus on oranges and diseased cattle to 4-H programs for youth and health initiatives in a state that consistently ranks as one of the unhealthiest in the nation.

In terms of LSU’s capacity in building human capital and the workforce – “the economic future of the state” — Alexander said it’s “absolutely” time to consider a tax increase.

Alexander praised LSU’s efficiency. He said that out of 50 flagship universities, LSU ranks 46 in terms of per-student spending. “Before the cuts, we were far more efficient than our peers,” Alexander said, of the $3,600 spent per student.

Speaking on the $1.3 trillion “epidemic” of student debt nationwide, Alexander noted that LSU undergraduates graduate with the third lowest rates of student debt in the country. Nationally, he said that 75 percent of students graduate with debt, while only 35 percent do at LSU.

Alexander touted the value of an LSU degree and the diversity of the student body. He said that last year’s graduating class had the highest numbers of African-American, Latino, and female students in the school’s history.

“We are committed to making sure our graduates get off to a good start and are not saddled with debt,” Alexander said. “And our reward, is to be looking at the largest budget reduction in the history of LSU or the history of the state.”

Asked about the possibility of leveraging more of the school’s athletic success, Alexander said there is a need to make sure that the academic and athletic sides of LSU “are better linked.” There can’t be one without the other, he noted.

Alexander also discussed ways for LSU to work more closely with elementary and secondary education to increase enrollment and “get more students ready for college.”

New Orleans’ two public four-year universities have been bleeding as a result of cuts over the past several years, and in the face of low enrollment and rising tuition (tuition rates are controlled by the state).

Chervenak saw his own political science department at UNO decrease from 12 faculty members to just four.

In February, University of New Orleans (UNO) President Peter Fos addressed the looming cuts, and the possibility of UNO declaring financial exigency – similar to bankruptcy, and a move that allows the administration to layoff tenured faculty.

Also in February, Southern University at New Orleans (SUNO) chancellor Victor Ukpolo said that with their budget cut by almost 60 percent over the past six years, SUNO may have to close altogether if the projected cuts come to fruition.

In December, Fos made recommendations to eliminate seven academic programs, one department and 26 faculty and staff positions. Since 2012, Fos has eliminated 110 positions.

The plummeting budgetary numbers Fos cited are dramatic: Six years ago, UNO received $74 million from the state. In 2014, the university received $28 million. The next cuts could leave UNO with as little as $11 million from the state for 2016.

Other states are moving toward privatization and getting out of the education business, Alexander noted, with much of the costs being passed on to the students.

A disadvantage of privatization, said Chervenak, is the shutting out of middle class and low-income students from the opportunity of going to college. “Where you develop human and intellectual capital, you have a more robust economy,” he said. “The more educated your population, the more dynamic your economy.”

In addition to the immediate need for tangible solutions that equal millions of dollars, King also stressed a need to have a deeper conversation about prioritizing higher education. He lamented that Louisiana spends close to seven times more to incarcerate a person than to educate a person in a university.

Louisiana leads the world in terms of imprisoning its own citizens, and it is an industry that has also seen significant privatization in recent years. For those who profit, every person newly locked up – or kept locked up—equals more money.

In his 2009 book “Higher Learning, Greater Good: The Private and Social Benefits of Higher Education,” Walter McMahon details the social benefits of higher education. McMahon writes: “There are earning and the quality of life benefits from living in a democratic society with substantial human rights due in part to the fact that college graduates serve on civic boards, commissions, and juries, as well as contribute financially to many nonprofit civic institutions. The Crime rates are lower as well when more young men attend community colleges, and are motivated to finish high school and to continue their education. State criminal justice system costs are lower, as are state health and welfare costs, and tax receipts are higher.”

One major concern about the actual cuts as well as the fear of potential cuts, is discouraging people from bringing their skills and productively into the state and the university system.

Lee McDaniel moved to New Orleans from Wisconsin in September for a job in bio statistical research with LSU Health Sciences. He wasn’t aware of the looming cuts, and said that if he had been, he may have weighed his career opportunities differently.

“Now, with the magnitude of the cuts, there’s no way of knowing if I will have a job or not,” McDaniel said.

If it were Chervenak’s budget to balance, he said he would “do away with tax exemptions and loopholes, and raise the cigarette tax.”

In a survey published by LSU last week, about 80 percent of people said they supported cutting government spending to fix the deficit, but not in education, health care, or highways. Overall, those polled supported more spending in those three areas. Close to two-thirds (63%) of the respondents said that the state, not students and their families, should play the major role in funding higher education.

This article originally published in the March 30, 2015 print edition of The Louisiana Weekly newspaper.