Millions on chopping block for University of Michigan, Eastern Michigan University and Washtenaw Community College
But private colleges would stand to benefit from Senate proposal
Proposed cuts to the higher education budget would cost the University of Michigan and Eastern Michigan University millions next school year.
The moves are being considered today by the Senate Appropriations Committee as part of a plan to cut university and community college budgets 3.1 percent, saving the state $47.8 million, said Ellen Jeffries, deputy director of the nonpartisan Senate Fiscal Agency.
That would mean $10.2 million less funding for U-M and $2.5 million less for EMU.
Students graduate at Eastern Michigan University.
AnnArbor.com | File photo
Washtenaw Community College would lose $380,400 in funding under the Senate proposal, Jeffries said.
The Legislature has until Oct. 1 to agree on the budget, though Gov. Granholm has asked that the process be completed earlier. The full Senate could consider the higher education proposal as early as next week.
This story will be updated.
Comments
johnnya2
Sat, Mar 20, 2010 : 8:56 a.m.
I wish people who bring up the type of car somebody drives would get some facts. Just because the face plate says Chevy, Dodge, or Ford does not mean it was built in the US. Honda, Toyota and Nissan all employ thousands of people in the United States. Their dealership networks are all locally owned as well. The mechanic at Howard Cooper Honda loves and works in Michigan. Buying my car there supports local jobs as much as buying from Varsity Ford. I have said for many years the way the fix the Michigan economy is simple. Free health care, and free college education for all who qualify. Any high tech company will flock to Michigan for the extra brain power, as will intelligent people who want to educate their kids. Companies that KNOW their health care obligation is handled will love the state. To those who say, the tax rate will be too high, I say, look at Ontario, where the tax rate is higher, YET they build more cars on Ontario than in Michigan. That is because Canadians have health care. As another side note, most businesses do not make their location decision based on tax rates. If that were the case why is Google, Yahoo, Microsoft, and Chase located in states with higher than average tax rates?
debling
Wed, Mar 17, 2010 : 9:18 p.m.
Time to cut salaries and benefits of overpaid (> $100K) Profs and administrators. These are public institutions not private businesses.
annarbor28
Wed, Mar 17, 2010 : 9:13 p.m.
An important figure is endowment per student and U-M does not usually figure even in the top 20 for this calculation.
skigrl50
Wed, Mar 17, 2010 : 8:20 p.m.
We can debate this all day long, but when it comes down to it college educations are becoming unaffordable for all of us. I am a single mom with no help from my ex, I have a child at EMU and one at UM and work in the public school systems. My kids get $0 after the MI Merit was cut except for loans that cover about 1/3 of their expenses. FAFSA says I can contribute 42000/year towards my kids education, that leaves me virtually no money left.... Where & when is this going to stop??
Patti Smith
Wed, Mar 17, 2010 : 7:38 p.m.
Has there been any discussion of professors* taking a pay cut? I ask b/c most K-12 teachers (including me) have taken pay cuts. I never see any suggestions about professors taking pay cuts; in fact, when it is suggested, people seem to get very angry and defensive and I can't figure it out....what am I missing? (not regular UM workers--I'm talking about tenured professors)
DonBee
Wed, Mar 17, 2010 : 6:18 p.m.
@ Brad - According to the US Census Bureau, Michigan is outpacing the rest of the nation since 2004 in spending on education at all levels. Michigan rose in the ranks from 18th to 16th on a per student basis for K-12 education during that time. In higher education, Michigan is a laggard in percent of the cost of college paid by tuition Michigan is number 46 out of 50 with the tuition cost being on average 57.8 percent. The worst is Vermont at 81.4 and the best is Wyoming at 13 percent. The links can all be found in the toolbar to the left of the main window under education at : http://www.census.gov/compendia/statab/cats/education/higher_education_finances_fees_and_staff.html
brad
Wed, Mar 17, 2010 : 4:34 p.m.
State should spend more on Universities, not less. This conversation misses the point that our economic competitors are increasing their investments in education. You can demand accountability without eliminating resources.
jon67
Wed, Mar 17, 2010 : 2:17 p.m.
SOURCE; The CHRONICLE OF HIGHER EDUCATION MIT is missing from this list for reasons unknown. Based on prior year numbers, MIT should be at #6. Market value (in thousands): Rank: June 30, 2009; June 30, 2008; One-year change 1. Harvard U $25,662,055 $36,556,284 -29.8% 2. Yale U $16,327,000 $22,870,000 -28.6% 3. Stanford U $12,619,094 $17,214,373 -26.7% 4. Princeton U $12,614,313 $16,349,329 -22.8% 5. U of Texas system $12,163,049 $16,171,184 -24.8% 6. U of Michigan $6,000,827 $7,571,902 -20.7% 7. Columbia U $5,892,798 $7,345,226 -19.8% 8. Northwestern U $5,445,260 $7,243,948 -24.8% 9. U of Pennsylvania $5,170,538 $6,211,622 -16.8% 10. U of Chicago $5,094,087 $6,632,311 -23.2% 11. Texas A&M U system and Fdns $5,083,754 $6,659,352 -23.7% 12. U of California $4,937,483 $6,217,334 -20.6% 13. U of Notre Dame $4,795,303 $6,225,688 -23.0% 14. Duke U $4,440,745 $6,123,743 -27.5% 15. Emory U $4,328,436 $5,472,528 -20.9% 16. Washington U in St. Louis $4,080,554 $5,350,470 -23.7% 17. Cornell U $3,966,041 $5,385,482 -26.4% 18. Rice U $3,612,884 $4,610,164 -21.6% 19. Vanderbilt U $2,833,614 $3,495,439 -18.9% 20. Dartmouth C $2,824,894 $3,660,159 -22.8% 21. U of Southern California $2,671,426 $3,589,225 -25.6% 22. U of Virginia $2,556,732 $3,307,928 -22.7% 23. New York U $2,094,300 $2,475,200 -15.4% 24. Brown U $2,017,006 $2,746,834 -26.6% 25. Johns Hopkins U $1,976,899 $2,524,575 -21.7%
DagnyJ
Wed, Mar 17, 2010 : 1:35 p.m.
@IMRight, could you post a link to the size of endowments ranked? Where do you get this list? Thanks.
IMRight
Wed, Mar 17, 2010 : 1:13 p.m.
Sorry my last post should read all but 5 other institutions in America.
IMRight
Wed, Mar 17, 2010 : 1:07 p.m.
Edward - Thanks for the legwork. Without reading the links (work is somewhat restrictive), I would say that U of M has much more flexibility than exactly 5 other universities in America.
IMRight
Wed, Mar 17, 2010 : 12:40 p.m.
Edward - Nice FAQ, however if you really read it, it is silly. "Q. Why not increase the rate of spending from endowment earnings when state funding is cut? A. The current endowment-spending rule is set to protect and grow the value of the endowment for the future, because it must continue to grow over the long-term to preserve the quality and health of the University. If an institution were to spend down its endowment for unplanned expenses, it would take many years to build the endowment back up through investment income, reduced spending and new gifts. The Universitys spending rule has changed only twice since 1986. U-Ms endowment-spending rate is based upon the historic track records of the capital markets and inflation. It is designed to support operations in a way that strikes a balance between generating a predictable stream of annual support for current needs and preserving the purchasing power of the endowment funds for the future. This approach allows the University to protect and stabilize yearly distributions through strong and weak markets." So they can't spend it because it needs to grow for the future. But why does it need to grow for the future, if you can never use it? The fact of the matter is that the endowment grows faster than inflation every year (They are excellent at managing the fund). They are saving money to grow the endowment for the future, at which time they will continue to save money to grow for the future. The reality is that they should be using some of the money now to bolster the school against current hardships. They are not dipping into the fund because they know that people will pay for the tuition increases. They are turning people away every year, as one commenter pointed out, so why lower the price of admission? Lets not forget, size of endowment is a major source of pride for top notch higher-education institutions. So dipping into it is counter production. My question for the UofM and the State of Michigan is this: Why is U of M's endowment allowed to grow to #6 in the nation behind: 1 Harvard 2. Yale 3. Stanford 4. Princeton and 5. University of Texas System For completeness they are followed by Columbia at #7. All but UT are private schools which receive little if any public funds. And I would imagine Texas has graduated double the students that Michigan has. They are competing with Ivy League schools, yet they cry poor every year when there are cuts.
Martin Church
Wed, Mar 17, 2010 : 12:21 p.m.
Hold on, let me get this right. we are paying taxes to pay for tution for students, and then chargeing those same students additional fees to pay. IS THERE SOMETHING WRONG IN THIS PICTURE. who is responsible for the cost of the education we are offering. I went to a "private" college (Spring Arbor) becuase it was cheapper then U of M or EMU. I paid for my education. Now we are being told the students going to public colleges are paying and the taxpayers are paying. Something is wrong. It is time to hold the schools accountable. They choose who they will take, then take our money. And not every student can attend these high priced schools. I have two kids one going to EMU and the Other planning on UofM Dearborn next Fall. And I will tell you I can not afford these tution increases. My son is now looking at the Navy to provide for his education. Our College boards need to be called into a legislature session and explain why they are double dipping into the state resources. Where is our state Reps (Ms. Wheeler-Smith)on finding out what is really going on. it is time to find out what the real cost of an education is. We can not continue with the failure of K-12 with our state Colleges.
Juliana Keeping
Wed, Mar 17, 2010 : 12:21 p.m.
Here is reaction from the governor via her spokeswoman, Liz Boyd. I'm also working on getting someone from the Senate side to comment. In the mean time, here is what Boyd said in a written statement to me: "As rightly reported, the governors executive budget recommendation maintains higher education spending at current levels. We know that education is the key to Michigans economic recovery and so it is important that we invest in the full spectrum of education."
IMRight
Wed, Mar 17, 2010 : 12:20 p.m.
Mark, Mick and Ig - While I agree it is likely to people at the top of the house making all the money, should the taxpayers be subsidizing that year after year? Shouldn't an institution such as UofM which takes pride in its liberalism (see: Hash Bash/Naked Mile), be looking out for the little guy more? Or at least treating everyone the same?
IMRight
Wed, Mar 17, 2010 : 12:10 p.m.
Ignatz- A look at the U of M budget does not bear out your claim that most of the rise in costs is attributable to the increasing cost of supplies and utilities. Compensation and Benefits went up 10% between 2007 and 2008 (the last years info is available). And that was from $2.96 Billion to $3.23 Billion. During the same period Supplies and Services went up from $1.10B to $1.17B.
DonBee
Wed, Mar 17, 2010 : 12:09 p.m.
If you follow the link and look at it it says: Tuition Grant Program. Governor eliminated $31.7 million for these need-based grants for students at independent colleges and universities. Senate restored. Note the comment about Needs based, which I believe means people who can not afford college based on the formula that the state uses. If they were really trying to keep people down, would you not eliminate this first? While I agree that funding public colleges and universities first is important, I believe that education funds at all levels should go to the people who need it the most and can afford it the least. If you are really interested in the topic, following the link in the article above and then googling the topic for comments on why makes for interesting reasons, both on the Governor's side and the Senate side. As to it being purely Republican, the tally from the restoration vote at least one Democrat had to have voted yes. The members are: Senators Stamas (C), George (VC), Hardiman, Kahn, Barcia (MVC), Anderson, and Brater. You can ask them directly why they voted the way they voted.
Mark O'Brien
Wed, Mar 17, 2010 : 12:04 p.m.
I drive a Ford Escape, if that's any of your business. If you want to see where money goes at UM, look at upper administration. Not at us shleps at the bottom.
Mick52
Wed, Mar 17, 2010 : 12:02 p.m.
Good post Ignatz. I am retired from UM and I agree with you. Most people get little in raises. However there seems to be a trend that those at the upper pay scales can still get huge raises, at least in some departments. What happens is the "uppers" get big raises and the lower paid get cuts and layoffs. Unfortunately its the lower paid people who are actually doing the work, providing services for people and with those cuts service quality declines.
IMRight
Wed, Mar 17, 2010 : 12:02 p.m.
Did you know that the university of michigan collected just under $800 million in tuition (net of scholarships) for the 2007-2008 school year (last numbers I could find)? Did you know that their endowment stands at $6.7 BILLION? They could collect $0 in tuition for 8 years and not miss a beat. It is time for the public univerisities to recognize that they were established for the public good, and not to horde cash and fight the will of the people of the state. Also note: UM got $404 Million from the state that year, the grant program is $31 Million for ALL of the private schools in the state. I know that the Republicans are evil meme plays well in AA, but when you really look at the facts, they don't really wash out. One last tip, click on the first link in the story which leads to the Senate Fiscal Agency's "Bill Analysis". Which party is restoring phase II of the TIP program which provides tuition assistance to Medicaid-eligible students? I am sure that was just a Karl Rove tactic!
Juliana Keeping
Wed, Mar 17, 2010 : noon
Here is a background article on the Granholm proposal to cut tuition grant funding to private colleges: http://www.annarbor.com/news/concordia-university-ann-arbor-students-stand-to-lose-1600-under-granholm-proposal/
Mick52
Wed, Mar 17, 2010 : 11:53 a.m.
I agree that private colleges should not get tax dollars, but I am not sure why there is opposition to the senate's position as noted in this article. The article notes the funding is for tuition grants to students. These students could be of either political slant and perhaps poor student who typically get financial aid. Or is this money going only to rich kids? I think I would be a little more lenient if this money is intended for students having trouble affording college regardless of where they are enrolling. Compare higher ed to K-12. Should tax dollars go to public schools only, many of which cannot come close to the quality of education at private schools? Shouldn't tax payers have a voice in where their tax dollars for education should go if one type is superior to the other? If people think a private college provides better ed than public colleges, who run amok, as friend12 noted, they they should have a right to push their reps on this issue.
Ignatz
Wed, Mar 17, 2010 : 11:50 a.m.
To those who don't know, not everyone at UM is a Professor, nor do we make anywhere near their salaries. We've had pay freezes and are experiencing staffing cuts. Our benefit copays have been and will continue to increase. This is on top of not getting huge raises or even making salaries equivilent to similar professions in private industry. The main benefit to working at UM is not getting laid off and that's no longer taken for granted. Besides, most cost increases come from the rising prices of supplies and utilities. At UM, at least, raising tuition is not a problem, except for the majority of people who can't afford it. That's who state funding really helped. We turn away many applicants, so the pressure to reduce tuition in really not there. BTW, I drive a Pontiac.
DaveQ
Wed, Mar 17, 2010 : 11:37 a.m.
What about all the people in town who work for Toyota and Hyundai? I think you should take those cars off of your list.
belboz
Wed, Mar 17, 2010 : 11:26 a.m.
Well, if your focus is the economy - I'd rather have people driving SUV's made in America than cars made overseas. Nobody said you had to buy one. There are plenty of cars made here in the US by Ford and GM. That attitude - "give me a break" - is a perfect example of indifference. And, have you visited factories outside of the US - I have. They have no regulation re pollution and damage to the environment compared to the US. It isn't all about the MPG. Raise tuition - typical. How about cutting salary and staff beneifits instead of passing increased costs onto the consumers and taxpayers. Like I said, professors often seem aloof and indifferent to what is going on around them. If Michigan has so many endowments, why would tuition need to raise...
SMAIVE
Wed, Mar 17, 2010 : 11:09 a.m.
And one wonders why the Republican party is seen as self-serving.
Cash
Wed, Mar 17, 2010 : 11:01 a.m.
Republicans only want to keep the little guy down....what better way than to make public schools unaffordable. It works in Mexico....why not here? Keep the poor lower class down. Wow,and there are actually people who buy into their fear-machine. Sad. Fund public ed and do NOT fund private ed? Republicans say no. Make it easier for the working class to vote by allowing easier registration and voting on a weekend? Republicans say no. Give health care to all Americans not just those who have deep pockets? Republicans say no. Meanwhile this year US dropped to 38th in the world in length of life. Even Cuba is now ahead of us.
Thornhill
Wed, Mar 17, 2010 : 10:42 a.m.
Dagny, This will have no effect on U of M. They have the sixth largest endowment of any institution in the country. It's Eastern, WCCC, etc. who will be feeling it.
Mark O'Brien
Wed, Mar 17, 2010 : 10:37 a.m.
I find it appalling that the right-wing would want to fund PRIVATE colleges this way. The reason we have a PUBLIC university system is to ensure that students have AFFORDABLE and accessible education options. Many private colleges offer substantial scholarships to students because of their endowments. If the legislature wants to help students, then make low-interest students loans available. I sent my daughter ti Northern Michigan University in Marquette. It's an excellent school, and one that flies under the radar of most people, probably because they are not a football or basketball powerhouse. As to the comment about staff and faculty driving Toyotas and VWs.. I suppose if they drove Cadillac Escalades and Ford Expeditions, that would be OK? Give me a break. UM staff (and I am one) have received pay raises that don't even match the cost of inflation over the past 10 years. I think most of us are more in tune with the economics of this country and its problems. If you want to paint with a broad brush, go attack the athletic system, which seems to have its own standards. If Michigan underfunds its public institutions, tuition may have to go up yet again. Unfortunately, we have a problem in that too many people think taxes cannot be raised, but there is no such thing as a free lunch -- except to legislators. Raise the sales tax by 1 cent. It's not going to starve anyone.
friend12
Wed, Mar 17, 2010 : 10:24 a.m.
What I would love to see is a directive with this bill requiring state colleges to freeze or reduce tuition to receive continues state funding. It's time they start doing some serious cost cutting like everyone else in this state. UM might think twice the next time it waste millions of dollars fight things like affirmative action with regard to admissions.
DagnyJ
Wed, Mar 17, 2010 : 10:04 a.m.
I agree Ignatz and freemind. It's about keeping money flowing to small private colleges, versus large public universities.
belboz
Wed, Mar 17, 2010 : 9:51 a.m.
Cuts at Universities should be higher. They feel immune to cost cutting measures and just spend, spend, spend. Proffessors then need to feel the cuts and pressure of this "global" economy. Perhaps then they'll realize that they are part of a larger economy, and need to support our domestic industries. Then, they can pass this message, lesson - or whatever you want to call it - onto their students. I see too many professors and staff members driving around in Volkswagens, Toyotas, etc... They appear indiferent to the taxpayers that work to provide money for their careers. Time to realize that you are part of the domino chain of an economy - not an independent driver.
Freemind42
Wed, Mar 17, 2010 : 9:45 a.m.
Why am I not surprised that a Republican dominated legislature wants to cut public school funding? Of course they want to help the private, christian schools instead.
Ignatz
Wed, Mar 17, 2010 : 9:38 a.m.
Why is the State paying people to go to private colleges? Are there not enough Public ones?