Return to Governor's Task Force on Higher Education Recommendations
GOVERNOR'S TASK FORCE ON HIGHER EDUCATION
- State government must make a dual commitment to higher education
funding sufficient to meet future needs and to reforms that increase
the productivity of our current system.
- In the 1995-97 biennium, the Legislature demonstrated its
ability to meet demands for increased access to higher education
within the framework of Initiative 601. While significant funding
challenges lay ahead, these challenges can be met within the present
- An effective long-term approach to higher education policy
should be guided by the following goals and principles:
- Recognition of the need for increased access to postsecondary
education, as projected by population trends and documented needs
of the state's economy.
- Higher education funding practices that respect the will of
the people for fiscal policy that is consistent with the intent
of Initiative 601.
- An emphasis on higher education as a student-centered rather
than an institution-centered system.
- Tuition policy that recognizes the shared responsibility of
the student and the state for the cost of obtaining a higher education,
coupled with financial aid policy that provides more assistance
to middle-income students.
- Continued state funding for workforce training, with incentives
for employers to share in those costs.
- Maximization of institutional capacity to serve more students
through revision of program offerings, redistribution of delivery
resources, improved coordination between the two-year and four-year
systems, expanded use of technology, and other reforms.
- Greater collaboration between the K-12 and higher education
systems to increase access to postsecondary educational opportunities.
- The "dedicated fund proposal" does not adequately
meet the higher education goals and principles set out above,
and is inconsistent with principles of sound fiscal policy.
- Experts on state finances strongly criticize the use of earmarked
revenues and dedicated funds to support major state budget programs.
The National Conference of State Legislatures states that such
practices reduce needed flexibility in both budget and revenue
policy, cause misallocation of resources, and reduce legislative
oversight of state programs.
- The dedicated fund proposal offered to this task force would:
- Significantly diminish the ability of the Legislature to make
budget policy, hindering it from its essential task of allocating
available state resources among competing needs and priorities,
- Cause expenditures for higher education to be determined by
available earmarked revenues, thus risking both overfunding and
underfunding of this budget function;
- Risk harm to other important state programs and services,
some of which will also be affected by severe demographic pressures
in the years ahead;
- Reduce legislative oversight of higher education by removing
it from the normal budget process, and so reduce incentives for
greater efficiency, productivity and accountability in higher
- Reduce the ability of the state to make needed changes in
revenue policy by earmarking a set portion of state tax revenue
to higher education;
- Take a major step toward the dismantling the spending limit
approved by the voters in 1993 by removing a major budget function
from the state general fund.
- The dedicated fund proposal also raises important concerns
with regard to higher education policy:
- Its funding plan begins from an assumption of need for access
based on targeted "participation rates," a population-based
measure that bears insufficient relation to the needs of our economy
or the demands of our citizens for postsecondary educational services,
and that gives little direction as to the mix of services that
will be required.
- Indexing base budgets and tuition to inflation obstructs any
reform of the present tuition and financial aid systems to (1)
bring tuitions more closely in line with those of peer institutions;
(2) shift more of the state's higher education subsidy to lower-
and middle-income students, or (3) relate education costs more
closely to the markets for education services.
- The Task Force has not sufficiently explored the capacity
of the state's present higher education system to expand access
to postsecondary educational services through institutional reforms
and better coordination among the components of that system. The
dedicated fund proposal gives little attention to ways in which
more students can be served, at lower cost, by improving the productivity
of the system.
- The dedicated fund proposal sets targets for obtaining operating
efficiencies over time, and includes measures intended to increase
the accountability of the system. While these are commendable
goals, its core provisions for dedicated funding and automatic,
inflation-based increases in tuition and institutional base budgets
are almost certain to act as disincentives to the efficiency,
accountability and productivity that it seeks.