Michigan Governor Rick Snyder unveiled his $45 billion fiscal year 2012 budget proposal that includes a 15 percent reduction to university operations funding.
Several times during his speech Thursday, Snyder said his budget called for “shared sacrifice” from everyone—including universities and colleges from around the state. Snyder announced he would accept only $1 in annual pay instead of $171,000, which is the governor’s salary.
“There will be many challenges,” he said. “I hope we all look back and say today is a defining moment. This is more than just balancing numbers. We are going to take responsibility for a legacy of debt that was built up over decades.”
Eastern Michigan University President Susan Martin said, although cuts to higher education funding were expected, she didn’t expect them to be so severe.
“I do compliment Governor Snyder for tackling the structural deficit,” Martin said. “We anticipated higher education would receive cuts, but I am disappointed the cuts were so deep. It will be very difficult for us to handle.”
For Eastern, the budget cuts would amount to a 19 percent decrease from its current operations funding from the state.
This would represent a reduction of $14.7 million.The university currently receives $76 million and this figure would decrease to $61.3 million.
Martin said an increase in tuition is very likely for the 2011-2012 academic year.
“We’ll probably have to have tuition increase,” she said. “Ultimately, the Board of Regents would decide. We are going to do some cost containment and take a look at everything to try and reduce our expenditures. The Board and I are very committed to keeping Eastern affordable.”
Martin said even with the funding cuts in mind, she doesn’t regret implementing the 0-0-0 initiative.
“I think it was recognition of how difficult it was for students and families,” Martin said. “It has had a significant impact. It is that revenue that will help us pay for things. We proved that we have capacity to grow. Overall, it was a good strategy. Will it happen again next year? Probably not.”
In the budget, Snyder said he is setting aside $83 million to reward universities that contain tuition and fee increases below the historical five- year annual system average. In order to be eligible, universities must keep tuition increases below 7 percent.
For Eastern, this would result in a $3.3 million grant. President Martin said the university will keep that in mind as they assess the financial situation for EMU.
“We need to get a better understanding of that,” Martin said. “But regardless, the Board of Regents and myself want to work to keep any increase as low as possible. I expect we will qualify for it though.”
Martin said she is aware the cuts may be “alarming” to the campus community and she is striving to keep constant communication with the campus.
“The key thing for students is to keep progressing towards that degree,” Martin said. “The economy is starting to pick up, more jobs are becoming available and we want to do everything we can to help you graduate.”
EMU junior Andrea Webb said she thinks students around the state will “pay dearly” for Snyder’s budget proposal.
“Education should be the last thing to receive a cut,” Webb said. “We were talking about it in my class today. It’s funny how these people want students to stay in Michigan after graduation. This is what makes us leave.”
The governor said he will maintain student financial aid funding at $51.5 million for needy students, but existing programs will be merged into a single Pathway to Higher Education program.
Snyder said it is important for citizens in the state of Michigan to step back and ask an important question.
“Isn’t it time for a comprehensive solution that makes us fiscally strong?” he said. “I don’t believe our citizens have had a chance to understand how much we’ve put on our credit cards.”
Snyder said the state must begin to budget wisely.
“Budgeting shouldn’t be about spending money, but showing results to people,” he said. “We need to get to this principle of not just paying for today. Let’s build that future.”
Snyder said by making sacrifices, the state as a whole can reap benefits.
“We can all win together in the long term,” he said. “It’s about coming together and being inclusive. We need to get to better accountability and better transparency.”
Snyder’s proposed budget includes $1.2 billion in permanent spending cuts that would eliminate the projected $1.4 billion in general fund deficit. The budget would work as a two-year plan, instead of the usual one-year.
The budget includes a $300 cut to funding per pupil K-12, this is in addition to the already implemented $170 per pupil reduction.
The proposal also reduces state aid to libraries by $2.3 million in the general fund, eliminates business credits for films, and eliminates the state income tax exemption for pensions.
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