By Eric Garneau
Anyone with an eye on the news lately has no doubt heard that states have had to cut funding to many programs due to budgetary shortcomings. On the surface, then, the source of the monetary problems faced by public universities seems obvious. If a state has to cut ten percent of its funding for higher education, then the colleges in that state have ten percent less money to work with. Somehow, they have to shave ten percent off their operating costs.
However, according to a recent editorial on InsideHigherEd.com, that's not necessarily the case. In reality, only part of a school's budget comes from state funding. Federal money, grants and tuition also factor into the equation significantly.
That's not to say, necessarily, that cuts in state funding can always be overcome by additional revenue sources, especially when Federal dollars aren't exactly plentiful either. But recently released financial records for the 2009-2010 school year have shown that in many cases the lack of state funds has been dealt with... and then some. In fact, Inside Higher Ed troublingly states that public universities 'could be boasting, if officially businesses, about record profits.'
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What that means: many universities that slashed programs in the name of budget restrictions have had banner years for revenue intake when compared to expenses. You'd be forgiven for drawing the conclusion that these schools didn't really need to abate any programs or lessen the workload of employees - they were doing just fine already. There might be lots of reasons to explain why, but chief among them is that economic recession tends to drive up college enrollment. Schools can use the increased tuition revenue from that phenomenon to make up for shortchanging from the state.
None of this is to deny that some schools truly are facing significant budget crises. In those cases, cutting back on programs and activities may be a necessary move, although Inside Higher Ed rightly points out that such action should be a last resort. Additionally, many schools have 'crisis funds' established for troubled times. If your institution's come to cutting programs and staff to get by, it seems like the right time to break into those funds.
In the end, the key word when it comes to budgeting is 'priorities.' Excess budgetary intake tends to be put towards administrators' pet projects (or, occasionally, their own pockets). Though the issue of allocating funds in a public university is no doubt a tricky one, in the end there doesn't seem to be a compelling reason for budgetary excess to coexist with a dearth of educational offerings.