State funding cuts hit as higher ed pushes for more stimulus
Campus leaders should act now to make their case for their college or university’s share of $3 billion in CARES Act funding that is going to state governors to spend as they see fit on K-12 and higher education.
The Governor’s Emergency Education Relief Fund is in addition to the $14 billion in Higher Education in Emergency Relief funding that is going directly to colleges and universities, said Thomas Harnisch, vice president of government relations for the State Higher Education Executive Officers Association.
In some states, K-12 and higher education leaders have already banded together to present disbursement requests to governors, Harnisch said during a webinar presented Thursday by McGuireWoods Consulting.
“Not only are we losing revenue, there are also increased costs due to the transition to online education,” Harnisch said the financial outlook for higher education.
More from UB: Will all college campuses reopen in the fall?
Institutions have had to buy laptops and other technology to fund the shift to online learning.
At the same time, colleges and universities have lost revenue from housing, dining, parking, research and other sources, and are anticipating sharp drops in enrollment for the summer and fall, Harnisch said.
Colleges and universities must use half of their share of the $14 billion in Higher Education in Emergency Relief funding to support Title IV students or those who are eligible for the assistance programs.
Students already in the program will receive funds first because they have already completed FAFSA and other paperwork, Harnisch says.
Institutions cannot use the funds to cover any of a students’ outstanding account balances.
Higher education’s next stimulus?
Congress is now working on a stimulus package for small businesses, and is expected to consider a major rescue plan for states in May that could include additional funds for higher education, Harnisch says.
More from UB: Colleges tinker with fall 2020 tuition to aid students
State governors have asked for $500 billion and organizations such as the State Higher Education Executive Officers Association are already advocating for more than $30 billion in direct funding for colleges and universities.
Higher education advocates will also continue to push for tax relief for colleges and universities for paid sick and family leave, which wasn’t included in the CARES Act.
Cuts already hitting public universities
As CARES Act funding goes out, public universities and colleges are already seeing cuts in state funding, according to published reports.
For example, Montclair State University in New Jersey, says it will not receive $12.3 million in state funding it had expected to complete this fiscal year, The Wall Street Journal reported.
To cope, leaders at Montclair State—which has an operating budget of $437 million—plan to offer fewer, larger classes next fall, and have postponed capital projects and eliminated temporary and contingent positions, according to The Wall Street Journal.
Oregon’s Higher Education Coordinating Commission estimates the state’s public universities and community colleges will lose $130 million this spring, according to OPB.com.
Oregon State University has reduced tuition, as all schools are facing increased technology and cleaning costs, OPB.com reported.
“Every institution is facing some really difficult, really choppy water financially—and that’s true even with the benefit and support of the CARES Act,” Ben Cannon, executive director of the Higher Education Coordinating Commission, told OPB.com.
UB’s coronavirus page offers complete coverage of the impacts on higher ed.
Interested in technology? Keep up with the UB Tech® conference.