Higher education funding has been short-changed since Republicans took control of the legislature in 2017, with the final target at $210 million that year – well below the governor’s $318 million request. Last session, the supplemental budget target was $0 with $1 million re-appropriated from another program; the U of M was completely shut out of funding last year.
With Senator Paul Anderson as the new Higher Education Committee chair, a DFL majority in the House, and DFLer Tim Walz as governor, DFL legislators were hoping for a higher target and more robust investments for higher education. (SF 2415)
Once again, the higher education budget proposals show a difference of priorities between the Governor, DFLers, and Senate Republicans.
The Senate Republican budget spends only $100 million on higher education, which simply does not do enough to improve affordability and access for the state’s college students or adequately train or prepare the future workforce.
Higher Education Omnibus bill
The 2019 Higher Education Omnibus Bill funds the Office of Higher Education, the University of Minnesota, and the MinnState system.
The Office of Higher Education receives only $24.586 million dollars. $23.4 million of that appropriation is to be spent on student grants; the governor requested $43 million for the same program.
The remaining $1.1 million may be used for increases across a number of programs run by the office, including College Possible, summer academic enrichment, emergency assistance for post-secondary students, teacher shortage loan forgiveness, student loan debt counseling, the Independence Life College, Fab Lab, and teacher prep design grants.
The University of Minnesota has requested $87 million for core missions, as well as $200 million in higher education asset preservation (HEAPR) funding and $32.3 million in capital requests in a possible bonding bill. However, the Senate Republican budget recommends only $28.514 million for the U of M.
MinnState has requested $246 million, including $169 million in inflationary increases, $111 million for salary and benefit increases, $37 million to replace outdated information system, $25 million for new scholarship programs, and $150 million in capital requests.
The Senate Republican budget recommends only $46.9 million for MinnState. (SF 2415)
Pressure to control rising higher education tuition costs has gained momentum at the Capitol this session. The Senate Republican higher education bill requires tuition control for both the U of M and MinnState.
MinnState may not increase the 2019-20 academic year by more than 2% of the 18-19 academic year, and for the 20-21 academic year the tuition rate must not exceed the 2019-20 tuition rate by more than 1%.
The tuition relief may not be offset by increases in mandatory fees, charges, or other assessments to the students.
The U of M may not increase the 2019-20 academic year by more than 2% of the 18-19 academic year, and for the 20-21 academic year the tuition rate must not exceed the 2019-20 tuition rate by more than 2%.
Students have supported a freeze, although it was not part of the governor’s proposal. Opponents suggest that a “freeze” can be costly to institutions if the investment from the legislature doesn’t fill the hole left by a tuition cap. MinnState estimates that the tuition control provision would cost the system $25 million.
Online tuition rate capped
As an additional effort to control tuition costs, the bill requires that institutions may not charge more for an online course than they do for an on-campus classroom course. Higher education officials assert that this change could cost the institutions as online courses are expensive due to the various technology needs and related costs.
Student loan requirement changes
State grants are awarded to students based on their specific family income and their ability to contribute to the costs of college attendance, known as assigned family responsibility, and on recognized cost of college attendance, including miscellaneous living expenses. The Senate bill changes those parameters, which will bring more students into the program.
Assigned family responsibility changes are decreased from 84% to 78 for dependent students, from 76% to 70% for independent students with dependents, and from 40% to 34% for independent students without dependents.
Living and miscellaneous expenses are also increased from 101% to 105% of federal poverty guidelines.
These changes mean more students could be awarded grants or that the grants awards will increase. It is not clear if the $23.4 million included in the bill will cover the changes.
Administrative cost reduction report
The Senate bill requiresboth the U of M and MinnState systems report by July 1, 2020 how they would achieve a 10% reduction in administrative costs by July 1, 2021. Questions have been raised about what defines “administrative costs” and whether such a report would help lower tuition increases for students. Implementing a 10% reduction could mean anywhere between $30 million – $160 million depending on how the term is defined, according to U of M officials.
Higher education contract negotiation limits
A provision limits the amount MinnState can negotiate with employees based on state appropriation amounts available. This bill mirrors SF 1877 which has been heard in the State Government Committee and constrains how union contracts for state employees may be negotiated. No contracts would be allowed to be negotiated beyond the amount of money appropriated that will cover the negotiated cost. The effect of this bill would mean the legislature would need to appropriate funding based on any collective bargaining agreement before it could go into effect, unless an agency anticipated contract changes and reflected those changes in their spending plan. The provision has no House companion.
Advisory council on rare diseases
The University of Minnesota is asked to establish an advisory council on rare diseases that will meet and provide resources and services to people diagnosed with rare diseases. A report is due annually to the legislature beginning January 1, 2020.
Controlling textbook costs
Three provisions in the Senate bill attempt to control rising costs of college education materials and textbooks.
The bill provides $250,000 to MinnState to develop and offer courses to implement the Z-Degree program, which provides a no-cost textbook associate degree. Instructors must review and approve open educational resources for use in a course. Opponents question the mandate that instructors only use open educational resources for these programs if the material doesn’t meet quality standards or the needs of the coursework.
Inclusive access pilot
A $50,000 grant is to be awarded to a MinnState institution through OHE for a pilot to design and implement an inclusive access textbook policy for digital textbooks. Inclusive Access is a Pearson (testing) Company program providing access to digital course content when instructors are using interactive Courseware platforms or e-books in place of printed text. The pilot must expand use of inclusive access to at least 60% of courses offered. The funds would be used to pay for the program.