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Education Roundtable with US Secretary of Education Arne Duncan

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US Secretary of Education Arne Duncan joined Governor Chris Gregoire and legislative leadership Duncan congratulated state lawmakers on discussing the issue of education reform, even through tough budget times. He further drew attention to the grave problems troubling education in the United States鈥攁 25% national dropout rate, poor STEM education, the large number of students taking remedial courses, and gaping budget gaps, which challenge the adequate funding of education.

Of particular interest, Duncan commented on the current system of education governance in Washington, claiming: 鈥淲ashington has eight different agencies with different strategic plans working in Washington and it鈥檚 very difficult for me to understand how having different agencies handling education鈥ill transform education.鈥�

Governor Gregoire has in to consolidate education governance into one Department of Education headed by the Governor. The would also consolidate many existing state education agencies into four primary education divisions: Early Years Division, K-12 Division, Community College and Technical Education Division, and the University Programs Division. All units would report to a new Department of Education Secretary.

Secretary Duncan reiterated President Obama鈥檚 despite the economic downturn, and gave examples of strategic programs and innovations the administration is working towards:

-Investing in Early Learning programs like , which studies have shown to improve achievement especially for disadvantaged students who do not have many educational opportunities at home

-Continuing the program which rewards schools for outstanding innovation and improvement in education (if approved by Congress)

Lastly, Governor Gregoire distributed a document describing how much it costs taxpayers when students 鈥渇all through the cracks鈥� of the education system– by dropping out, taking remedial courses, or repeating grades–a number her advisers estimate at around $ 100 million a year. Though the problems facing education in Washington state and in the nation are indeed grave, it was encouraging to see lawmakers pause during a critical week to discuss education. As Secretary Duncan asserted, 鈥渙ur children cannot wait for the economy to bounce back鈥濃�攅ducation must remain a priority, despite the dire budget situation.

State Budget Updates

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OPB published a yesterday discussing expectations for the upcoming Washington State revenue and caseload/entitlement forecasts, and how both are likely to affect UW state funding levels.

**EDITED TO ADD: Note that after we released this information, the was released and lowered the expected growth of caseloads for K-12, Medicaid, and Corrections. In particular, the anticipated impacts of federal healthcare reform lowered the predicted caseload for state-supported medical programs by $117 million in the long-term and $70 million in the short-term.**

Nationally, the Center on Budget and Policy Priorities (CBPP) updated their this week. They summarize the challenges faced by states via their :

  • For fiscal year 2012, one of the most difficult budget years on record. Some 44 states are projecting shortfalls totaling $112 billion for the year, which begins July 1 in most states. (See chart below.)聽 This figure is somewhat lower than in our previous version of this analysis, largely because of actions that Illinois took in its last legislative session that reduced the size of its 2012 shortfall.
  • The loss of emergency federal assistance. Assistance through the 2009 Recovery Act and the August 2010 jobs bill has been a huge help to states, allowing them to balance their budgets with smaller budget cuts and tax increases than they would otherwise need to make.聽 But that aid will largely be gone by the end of fiscal year 2011.
  • A long road to recovery. Already, 26 states are projecting shortfalls totaling $75 billion for fiscal year 2013, which begins in 16 months.聽 This number will likely grow once all states have prepared estimates.

More on the Public/Private University Resource Gap

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Two higher education news stories leapt out at us this morning as emblematic:

  • Pennsylvania Governor Tom Corbett announced for four-year public institutions. The largest institution, Penn State, would see its state subsidy reduced from $465 million per year to $233 million. The University the proposed cuts as devastating:聽 “A reduction of this magnitude would necessitate massive budget cuts, layoffs and tuition increases, with a devastating effect on many students, employees and their families,” said Al Horvath, senior vice president for Finance and Business. “While we have for many months been planning for a potential state funding cut, we could not have envisioned one so damaging to the future of the University and the Commonwealth.”
  • Meanwhile, in Los Angeles, the University of Southern California kicked off the day with an of a new, record high, unrestricted $200 million gift to the College of Letters, Arts and Sciences. The College will be named after the alumni donors, David and Dana Dornsife, who told the Los Angeles Times that they “had confidence in USC faculty and administrators to spend it wisely.” USC intends to use the money primarily to enhance the humanities and social sciences through faculty hiring, graduate fellowships and research funding.

As mentioned in about faculty salaries, the growing resource gap between public and private institutions predates the Great Recession, which appears to be dramatically accelerating the existing trend. Read the 2009 Association of Public and Land-Grant Universities (APLU) report, , to learn more about this concern: “from 1987 through 2006 revenue per student in private research universities in every revenue category except state funding has grown to be multiples of that available to the publics.”

Public/Private Faculty Salary Gap Widens

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New survey results released today show that faculty at public institutions of higher education, on average, received no salary increase for the second year in a row, while salaries for faculty at private institutions increased, on average, by about 2 percent (compared to also being stagnant last year).

This trend is particularly troubling because the current economic crisis seems to be accelerating pre-existing gaps between public and private faculty salaries.聽 Inside Higher Ed .

State Budget Pressures Continue to Mount

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Here are a few interesting and updated resources on the current budget pressures being faced by states across the US:

  • This shows, by state, projected deficits for FY 2012, ruling political parties, number of public employees, and whether most public employees have bargaining rights.
  • This is continuously updated and contains compiled information on municipal debt, pension liabilities, bankruptcy proposals and other issues related to state and local government finances.
  • This compiles information about initial FY 2012 budget proposals for those states that have released them, documenting a fourth year of deep cuts for many states.

UW Asked to Model Steep Budget Cuts for 2011-13

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Last week, Senate and House Fiscal and Higher Education Committee leadership and the community and technical colleges to identify specific budget reductions at three levels for 2011-13. For the UW, those cut intervals聽were: 聽The Governor’s proposed $189.8 million cut, a $218 million cut (Governor鈥檚 cut + 15%), and a $246 million cut (Governor鈥檚 cut + 30%). For scale, the UW received $627 million in state funds for the 2009-11 biennium (Fiscal Years 2010 and 2011).

Potential reductions identified by the UW and , although President Wise pointed out in correspondence to campus leadership that some of the examples in the letter, 聽“…may come to pass, but only as a result of the strategic budget process currently underway, not because of reference in the letter.”

Neither the House nor the Senate Fiscal Committee has submitted their budget proposal for the 2011-13 biennium yet and we do not know how each committee will ultimately handle the UW’s state appropriation. While we have the Governor’s proposed budget in hand, the appropriations process is far from being over. We will continue to post state budget updates to this blog as they develop.

Media coverage of our submission to the Legislature is available , , and .

University of Wisconsin Poised to Receive Greater Autonomy?

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Current have dominated press coverage of Governor Scott Walker’s proposed 2011-13 state budget this week. Lost in the shuffle may have been news that the proposal contained a provision that would lead to , the University of Wisconsin at Madison. UW Madison Chancellor Biddy Martin has requested that the UW System Board of Regents not oppose the move, which she argues would be essential to protecting excellence and access for the state’s flagship campus.

Potential legislation based on the Governor’s proposal is expected to be introduced by Republicans and would be likely to include the following freedoms for UW Madison:

  • Tuition setting authority and freedom to manage all funds
  • Authority to implement institutional budget without System approval
  • Ability to recruit, hire and retain employees outside of the state system
  • New flexibility in purchasing
  • Authority to handle its own building projects

The University has sought such freedoms from the state for years, and the article suggests that the chancellor has been working for over a year to craft the current proposal, which she calls the .

For more information about this topic, read our recent and the varying degrees to which it currently exists at the UW Seattle and our Global Challenge State peers.

Closing in on a Final Compromise for the FY 2011 WA State Budget

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Leadership in both fiscal committees of the House of Representatives and Senate signed a budget deficit. Both new cuts and fund transfers are included in the compromise.

While the budget is not final and both chambers must take a floor vote,聽the is in near final form. Higher education institutions would not receive direct state funding cuts, but would be asked to聽backfill a聽new cut to the State Need Grant (SNG) with institution resources. The UW would be directed to use聽$5,658,000 of internal funds to cover the general聽fund reduction to the SNG.

Also note that higher education institutions were exempt from a salary reduction (furlough) requirement.

Lastly, the compromise budget did not close the Basic Health Plan but it did make .

Federal Budget Proposals Affect Higher Education

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The UW Office of Federal Relations has posted detailed summaries of how recent federal budget proposals may affect higher education. As the that target Pell grants and funding for federal agencies that support academic research, that largely protects financial aid and research and development.

Visit often for updates on federal budget negotiations.

Virginia Close to Passing Major Higher Ed Reform

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Virginia’s Governor, Robert McConnell, endorsed all of the recommendations made by the he created last year to explore policy options for higher education reform. The resulting has moved quickly through both the House and Senate and may soon be on its way to the Governor. The bill provides $50 million in new funding for higher education institutions in Virginia, a UW Global Challenge State peer, as a ‘downpayment’ on the lofty reform goals outlined by the bill, including:

  • Producing 100,000 additional degrees over the next 15 years.
  • Providing incentives to increase enrollment of Virginia residents by creating target resident enrollment goals for institutions.
  • Creating incentives for improving retention, graduation, and time-to-degree.
  • Crafting new performance agreements focused on policy outcomes.
  • Enhancing efficiency by increasing institutional managerial autonomy.
  • Creating a higher education rainy day fund for use in economic crisis.
  • Establishing objective, peer-based funding goals.
  • Increasing state support and reducing reliance on tuition revenue.
  • Restoring state aid for students attending non-public Virginia colleges.
  • Increasing state need-based aid for low and middle income students.
  • Increasing year-round use of physical and instructional resources.
  • Increasing use of technology in the classroom, and increasing online course offerings.
  • Increasing enrollment in dual credit programs to shorten time-to-degree.
  • Creating public/private partnerships to increase STEM degree attainment, and facilitate commercialization.
  • Creating a catalog of R&D assets and activities so that the state can align investments with existing strengths/activities.
  • Creating an emerging technologies fund to recruit faculty, purchase equipment and provide seed funding.

The Washington State legislature is considering its own right now. Make sure to follow its progress via our (bill number 5717).