Category: FY14 State Budget

The Impact of Recent Budget Cuts on PSU

This year’s session was a lengthy one with lawmakers needing an additional nine days to agree on a budget and tax rates.

After 99 days the session ended Sunday morning with the passage of a two-year budget that includes significant cuts for public higher education in Kansas

These cuts came despite our session long advocacy efforts on behalf of the governor’s proposal to hold higher education funding flat.

In total, the budget includes cuts to higher education in excess of $37 million over a two-year period.

Included within the cuts is a 1.5% across-the-board reduction for both Fiscal Year 2014 and Fiscal Year 2015, a reduction in State General Funds based on a “salary cap” provision and the continued self-funding of the classified employee longevity program.

Here is how the legislature’s action will affect Pittsburg State University during FY 2014.

  • A 1.5% cut to base funding
  • A reduction in SGF funding as a result of the “salary cap” provision
  • Elimination of funding for the classified employee longevity program with the cost covered by the university

The end result is a total FY2014 cut to our base funding of more than $900,000 or 2.6% with an additional $650,000 cut in FY2015.

PSU’s base state funding has been cut by more than $5 million since 2008 and now sits at approximately the same level it did in 2004. These cuts have come at a time when the University has grown. Since 2004 our enrollment has grown by more than 11%. The end result is that we must do more with less to provide the same high level of education and career preparedness.

The targeted enhancement for our new polymer science program was funded with an additional allocation of $500,000 per year.

While we are thankful for the increased enhancement for the polymer chemistry program, we are very disappointed with the legislature’s decision to significantly cut base state support for higher education. As a result of their decision there will be incredible pressure on tuition rates which will inevitably hasten the shift in the cost of education on to students and families.

If policy makers are serious about making Kansas a business-friendly, pro-growth state, higher education must be a foundational investment. A well-educated, well-prepared workforce is essential for businesses to grow and compete in the global marketplace. Additionally, increasing the educational attainment of Kansans will enlarge the tax base by making them more employable and increasing their lifetime earning potential.  Probably most troubling is the fact that these cuts to Kansas higher education come at a time when at least 32 other states are increasing their investment in higher education placing our state at a competitive disadvantage.

House and Senate Budget Cuts Threaten Kansas Higher Education, PSU, and Economic Health of the State

Last week both the House and Senate passed budget bills that include cuts to higher education. The House budget bill (Sub HB2231), which passed out of the chamber on a vote of 68-55, reduces funding to higher education by more than $50 million in FY14. In addition to a 4% across the board cut to all institutions the House budget bill includes universities in “global” state agency cuts, which would total more than $20 million. While Regent institutions were exempted via floor amendment from the salary and wage cap provision an $18.1 million salary adjustment remained in the bill. The total revenue reductions to PSU in the House bill would be as much as $2.8 million or more than 8%.

The Senate budget bill (S Sub for HB2143) passed on a 24-16 vote. The Senate bill incudes a 2% across the board cut to higher education ($15.2 million). The Senate bill does not include any of the “global” state agency cuts included in the House budget bill. The total reduction for PSU in the Senate bill is $700,000.

Over the past five years, higher education funding has been reduced by more than 15% while statewide enrollments have grown by more than 11% over the same period. Recognizing the role of higher education in the economic health and success of the state, Governor Brownback recommended level funding for all institutions along with targeted enhancements such as PSU’s new polymer chemistry degree program. Higher education is essential to Governor Brownback’s Road Map for Kansas  and to moving the Kansas economy forward. PSU and KBOR continue to support the Governor’s budget recommendation of no cuts for higher education. Cuts, such as those included in both House and Senate budget bills, threaten the growth and stability of higher education in the state and would further shift the cost of education onto students and their families.

Conference committee negotiations between the House and Senate began this morning. Conferees are as follows:

Rep. Marc Rhoades, Chairman, House Appropriations Committee

Room: 111-N
Phone: 785-296-7682
Email: marc.rhoades@house.ks.gov

Rep. Gene Suellentrop, Vice Chairman, House Appropriations Committee

Room: 186-N
Phone: 785-296-7681
Email: gene.suellentrop@house.ks.gov

Rep. Jerry Henry, Ranking Minority Member, House Appropriations Committee

Room: 47S
Phone: 785-296-7688
Email: jerry.henry@house.ks.gov

Sen. Ty Masterson, Chairman, Senate Ways and Means Committee

Room: 545-S
Phone: 785-296-7388
Email: Ty.Masterson@senate.ks.gov

Sen. Jim Denning, Vice Chairman, Senate Ways and Means Committee

Room: 541-E
Phone: 785-296-7394
Email: Jim.Denning@senate.ks.gov

Sen. Laura Kelly, Ranking Minority Member, Senate Ways and Means Committee

Room: 125-E
Phone: 785-296-7365
Email: Laura.Kelly@senate.ks.gov

FY14 Budget Report

Governor Brownback released his FY14 budget report (his budget recommendations) this morning. The report was released in two volumes and can be found here: volume 1 and volume 2.  An synopsis of the budget recommendations by Budget Director, Steve Anderson, can be here.

The Governor’s Budget Report officially starts the session-long budget process. One major shift from previous budget proposals is the Governor’s recommendation to move to a two year state budget.

We’ll obviously be tracking the progress all along. The good news for PSU is that Governor Brownback has included second year funding for our Polymer Chemistry program (as recommended in his FY13 report) and recommends  holding higher education funding steady for the next two years.

State of the State Address

Governor Sam Brownback will deliver the 2013 SOTS address to a joint session of the Kansa legislature this evening at 6:30 pm. The Governor is expected to outline his agenda for the 2013 legislative session which will likely focus on his plan to balance the projected $267 million shortfall. The Governor has previously indicated his openness to an extension of the one cent statewide sales tax passed in 2010. A portion (.4 cents), dedicated to KDOT, will remain on the books without legislative action but the remaining 6 tenths of a cent is scheduled to expire on July 1st. Extension of the expiring .6 cents could mean as much as $250 million to the state budget but extension of the sales tax may be politically difficult with both Democrats and some Republicans in opposition.

The governor will also likely respond to the recent court of appeals decision ruling the current K-12 school funding to be unconstitutionally inadequate. Yesterday GOP leaders in both the House and the Senate voiced their opposition to the ruling. Implementation of the court’s order to fund base aid per pupil at $4,492 would result in a tax increase of nearly $600 million. The decision will be appealed by Attorney General Derek Schmidt but in the meantime will likely cast a shadow over any discussion of K-12 funding during the 2013 legislative session.

Tune into watch the Governors SOTS address at 6:30 pm or you can listen on your local Kansas public broadcasting radio station. In the Pittsburg area that is KRPS 91.3.

2013 Legislative Preview

This weekend legislators from across Kansas will be packing up and preparing to head to Topeka on Monday for the start of the 2013 legislative session. The legislature will officially “gavel in” at 2 p.m. on Monday January 14th marking the official start of the session. On Tuesday January 15th Governor Brownback will present his annual State of the State address, outlining his policy vision for the state and the items he would like to see the legislature address during their 90 days of work in the Capitol.

After a very contentious and hard fought campaign season the first clear observations of the 2013 legislature are the number of new faces and the significant shift in leadership (specifically in the Senate). On Monday, 55 new representatives (the largest number of new members in 42 years) will report for duty in the House and 16 new senators (the most new members since 1993) will report to the upper chamber. Some of these 71 members have served previously or served in the House before being elected to the Senate, but the majority will be serving their first day as a legislator. The learning curve will be steep for these new legislators, as they will be faced with a set of significant challenges for our state, chiefly the budgetary and fiscal challenges we now face.

Fiscal and Budgetary Issues Likely To Dominate

According to January estimates from Legislative Research the projected budget shortfall legislators must address is $267 million. The fact of this projected deficit will loom over all other discussions during the session. Obviously this shortfall must be addressed through revenue enhancements (via sales or income tax increases or changes), spending cuts, or some combination of the same.

One possible consideration will be extension of the six tenths statewide sales tax set to expire at the end of June. Extension of this sales tax would add around $250 million in revenue. Securing the votes to extend this tax may be difficult though given that a number of legislators campaigned against the sales tax (either in this or previous election cycles). Another possible consideration may be an effort to “broaden” the tax base through elimination of certain deductions and credits. Success for this option is even more questionable given the fact that the deductions which would provide the most significant impact on deficit reduction are also the most popular – namely the mortgage and charitable deductions. The final issue, on the revenue side, is the option of tweaking or reconsidering certain aspects and implementation of the income tax reform passed last session.

We’ll know quite a bit more about the direction of fiscal and budget discussions after Governor Brownback’s State of the State Address on Tuesday evening and the release of his budget report the next morning. You’ll be able to access the Governor’s full budget proposal after 8 a.m. on Wednesday January 16th at the Kansas Division of Budget website.

PSU’s 2013 Legislative Advocacy Priorities

Our advocacy agenda for 2013 is essentially threefold:

• Preserve base funding to Pittsburg State University.

• Secure second year funding of our new Polymer Chemistry degree program.

• Build support for the establishment of the Kansas Center for Career Technical Education Instructor Development and Innovation at the KTC.