A Message from the President
June 7, 2011 - Legislative Update
Summer classes began this week, and the current Legislative Session is a little more than half way complete. In fact, the Session will end on June 23, in about three weeks.
As predicted by many, the Session has been tumultuous, marked by heated debates over numerous issues, including the State's budget for next fiscal year that begins July 1. Although there are many major issues still undecided, I thought it appropriate to provide the campus with an update on some of the issues most important to Southeastern and higher education.
One of the most hotly debated issues of the session was the proposed merger of SUNO and UNO, which has apparently failed for now and instead morphed into a proposal to transfer UNO from the LSU System to our University of Louisiana System. That proposal has cleared several legislative hurdles and appears to have a good chance for final approval.
House Bill 413 by Rep. Wooton would have allowed concealed gun permit holders to carry guns on college campuses. This is essentially the same proposal Rep. Wooton had unsuccessfully proposed for the last couple of years. Last week, it failed in Committee and appears to be dead for this Session. As Rep. Wooton is term limited, I am hopeful that we will not face this challenge again soon.
Legislation often referred to as GRAD Act 2.0 seeks to further clarify both the performance expectations and institutional autonomies originally established through the LA GRAD Act legislation approved last year. The current legislation has been approved on the House side but has yet to be taken up by the Senate where it must begin in the Senate Education Committee. The version adopted by the House prioritizes performance expectations associated with student success - retention and graduation rates. Passage in some form seems likely.
You will recall that the GRAD Act allows institutions to increase tuition if performance targets are met. For Southeastern this amounts to a 5 percent tuition increase next year and 10 percent annually thereafter until the average for our SREB peer institutions is reached. Five percent next year equates to a little more than $2 million for Southeastern.
Two measures that could provide additional financial resources to colleges and universities next year are pending action by the House of Representatives. House Bill 448 by Rep. Downs would allow institutions to charge tuition for up to 15 credit hours rather than cap tuition at the current 12 credit hours. This measure could mean an additional $6 million per year for Southeastern.
House Bill 97 by Rep. Hoffman would change the way a current operational fee is calculated, basing the fee on 4 percent of current tuition rather than the 2004 tuition level in effect when the fee was first approved. This measure could generate not quite $1 million per year for Southeastern.
Both HB 448 and HB 97 were hotly debated in the House Education Committee where I provided testimony about the potential impact for Southeastern. Both Bills were referred favorably to move forward for debate and vote on the House floor. However, passage is considered a long shot, as a two-thirds majority vote in both houses is needed to win final approval.
While there are other proposals before the Legislature that would impact higher education, such as the proposal to abolish the Board of Regents and all management boards, creating a new single board for all post-secondary institutions, the most critical issue remains next year's budget. House Bill 1, the Governor's Executive Budget, after being significantly amended, has passed out of the House of Representatives and is currently being reviewed by the Senate Committee on Finance.
As anticipated, the House did not agree with some of the provisions in the proposed budget, particularly those that relied on one-time or contingent revenue. Some of the revenue used to balance the Executive Budget relied on money that would not materialize unless other proposals ultimately won legislative approval. Some of these proposals include privatization of the Office of Group Benefits and increases in retirement contribution rates for certain State employees. Disagreeing with use of these contingent funds, the House stripped these resources and balanced the Budget with additional spending reductions, primarily in healthcare and economic development.
Importantly, the Budget at present does not appear to include additional reductions in total State funding for higher education; however, it seems unlikely that the Senate will concur with all of the changes in the Budget made by the House. How the Senate might restore any of the reductions made by the House and maintain a balanced Budget is unclear at this time.
As the Budget for next fiscal year must still be finalized, the remaining days of the Legislative Session will be critical. I will continue to keep the campus informed as additional information becomes available.