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 Post subject: SELA Budget Concerns
PostPosted: Tue Jun 09, 2009 9:10 am 
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E-Mail From Dr. Crain

Quote:
Dear Southeastern Alumnus:

I am certain you have heard and read much about higher education
funding and the deliberations of the Louisiana Legislature. I feel it
is important that you are informed about how these proceedings will
potentially affect Southeastern.

Governor Jindal's executive budget for next fiscal year proposed a
$219 million reduction in funding for higher education. This
translates to a $15.6 million reduction in Southeastern's operating
funds, representing a 20% reduction in our appropriation from the
State and more than a 12% reduction in our operating budget (our
operating budget includes both state appropriations and student
tuition and fees).


This proposed budget was deliberated in the House of Representatives
where a number of amendments were made that would provide partial
relief from these budget cuts. While we are grateful for this
assistance, the $100 million in budget cut relief frequently
mentioned in the press may not ultimately materialize. Specifically,
the House amendments, and our associated concerns, are as follows:

* $10 million for the LSU and SU Ag Centers. This provides relief for
these two centers, not Southeastern.

* $33 million from tuition increases. Southeastern's part of this
approved 5% tuition increase is about $2 million. These funds match
almost exactly the amount of mandated cost increases associated with
healthcare, risk management, and retirement fund contributions that
are NOT reflected in estimated expenditures for next year's budget.
As a result, the tuition increase provides virtually no net relief
from the proposed budget cuts.

* $50 million from a tax amnesty program. While these funds would
provide relief, the nature of the legislation and timing of the
potential revenue collections make it highly uncertain that these
funds will be available to support operating budgets in higher ed.
Even if our concern about the uncertainty of these funds turns out to
be unfounded, this is a little less than one quarter of the proposed
$219 million total cut to higher ed.

* $7.3 million for dual enrollment. Southeastern participates in the
Early Start dual enrollment program and likely would qualify for some
of these funds, perhaps a few hundred thousand dollars; however,
these funds are targeted to that program and do not provide relief
from the $15.6 million proposed cut to Southeastern's operating budget.

* $6.2 million for library acquisitions. Southeastern likely would
receive a few hundred thousand dollars of these funds. While limited
in amount and targeted to this specific use, these funds would be
used to offset some of the reductions we would make in library
support to accomplish the proposed $15.6 million budget cut.

So as you can see, there remain some significant concerns about next
year's budget and the potential relief provided by the House of
Representatives, which is why the Louisiana State Senate adopted
Senate Bill 335 to provide additional relief.

As I have visited with members of the Legislature and people in the
community, I find that there are common misunderstandings regarding
SB 335 and higher education funding, so I hope you will allow me to
use this opportunity to clarify some of these issues.

* SB 335 does NOT postpone the repeal of the Stelly plan. The Stelly
Act eliminated all itemized deductions for state income taxes, and
its repeal restored a limited percentage of these deductions. A
change in the law last year set in motion a process to further
increase the allowable amount of these deductions in phases over
several years until 100% is reached. SB 335 temporarily freezes the
level of deductions at the current 65% level.

* SB 335 is not a tax increase. No one will pay more taxes next year
than they paid this year as a result of SB 335. The percentage of
allowed deductions will remain the same.

* SB 335 will result in a change in estimated revenue that the State
uses to determine next year's budget. The additional estimated
revenue would be dedicated to restore a portion of the proposed cuts
to higher education.

I also want to briefly address issues about the higher ed budget you
might have recently heard or read about.

There is an assertion being made that the higher ed budget cuts,
after the relief proposed by the House of Representatives, amount to
less than four percent.

These calculations appear to be based on what is known as the "total
means of financing" for higher education rather than the more
meaningful "state support" for higher ed. The "total means of
financing" includes funds not available to support general operations
of our State's colleges and universities. Including these dedicated
funds in the computation of our budget cuts artificially inflates the
amount of resources we have to operate and makes the proposed budget
cuts appear smaller than they actually are.

There also has been information circulated recently about the growth
in Louisiana's higher education budget over the last decade. The
implication is that higher education in Louisiana has arrived at some
lofty over-funded status and should accept the proposed budget cuts
without question.

The fact is that higher education was funded at such a low level for
so long in Louisiana that a significant infusion of funds was
required over the last decade just to arrive at the average in state
support for the southern region of the country. The additional
investment in higher education over the last decade resulted in the
creation of a community college system, creation of new programs to
support workforce development, and improvements in student retention
and graduation rates.

As a state we cannot afford to take a drastic step backwards in
supporting higher education. As we know from our own history, when we
have drastically cut funding for higher education, it has taken us
decades to recover. Higher education also represents the most basic
form of economic development. Without an educated workforce, our
state will continue to lag behind.

Our institutions of higher education also have a tremendous economic
impact of their own. Southeastern has an annual economic impact of
$564 million. The proposed cuts could reduce this impact by $125
million - a huge impact on our community.

Louisiana must continue to invest in education. Nothing less than the
future of our state is at stake.

John L. Crain, President
Southeastern Louisiana University


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 Post subject:
PostPosted: Tue Jun 09, 2009 10:19 pm 
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I would guess that Louisiana is very sensitive to levels of oil and gas drilling plus NOLA is still not recovered. They always seem to be more affected by recessions (as well as by boom times) than Arkansas. Hope we do not get to this point in Arkansas as higher ed really needs more money, not less. Let's cross our fingers that the new lottery really does produce new money for higher ed and that Ledge does not just shift current spending elsewhere. Hope SELA and others in LA can work thru this without serious long term damage.

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