Proposed Impact to Governor's Budget Cuts

Greitens' state funding cuts add to University of Missouri's budget woes

By Rudi Keller

Gov. Eric Greitens cut $83.8 million from college and university budgets Monday, wiping out state funding increases, cutting into core funding and eliminating budget lines for special projects.

The cuts will add to budget woes at the University of Missouri, where lawmakers cut $3.8 million from system administration in the current budget and a precipitous drop in freshman enrollment forced a 5 percent cut to budgets on the Columbia campus.

Instead of receiving a $9 million increase in state aid to help mitigate a $36.3 million decline in tuition revenue, cuts Greitens imposed Monday will reduce the campus budget by an additional $13.7 million. Overall, the university system will bear $31.4 million of $146.4 million of Greitens’ restrictions.

In a video news release, Greitens said lagging state revenue will force $700 million in budget cuts over the coming 18 months, with $146.4 million in immediate restrictions for the year ending June 30.

“The budget we’ve inherited from the previous administration is not balanced,” Greitens said.

In March, interim MU Chancellor Hank Foley announced a 5 percent cut to general fund spending and a campus hiring freeze. He also told administrators to plan for additional cuts of as much as 2 percent for the 2017-18 and 2018-19 fiscal years.

MU laid off 37 employees and cut an unknown number of part-time adjunct and full-time nontenured faculty as a result of Foley’s directive. The campus budget of about $1.2 billion used reserve funds and the anticipated new state aid to reduce the impact of lower tuition revenue.

Christian Basi, MU campus spokesman, referred reporters to the system administration for comment.

A prepared statement from UM System spokesman John Fougere did not indicate where the university would cut spending to cover the shortfall.

“We certainly understand that our state leaders have to make difficult decisions in challenging budgetary times,” the statement read. “We are committed to working closely with our new Governor and General Assembly in making the case for the University of Missouri System’s enormous positive impact on all of Missouri’s citizens and economy.”

Last week, lawmakers and the new Republican administration said tax receipts were well behind estimates made when the current budget was written. In his release, Greitens blamed “a bad business climate and costly Obamacare” for forcing the cuts.

House Minority Leader Gail McCann-Beatty, D-Kansas City, criticized Greitens for targeting higher education. More than 60 percent of the cuts were from education spending lines, she said in a prepared statement.

“Weakening public education won’t grow Missouri’s economy or create jobs,” she said.

Jean Mott Oxford of Empower Missouri, a social welfare advocacy group, blamed tax limitations approved by voters and tax cuts enacted by lawmakers, she said.

“Taken in combination, Missouri’s voters and General Assembly have structured our state to fail to provide essential programs and services and destined Missouri governors to face withholdings repeatedly,” she said in a prepared statement.

The cuts to higher education mean four-year campuses and two-year community colleges will not receive one of 12 equal payments from the state, acting state Budget Director Dan Haug said. The cut to operating funds is about $67.7 million of the total taken from higher education.

Cuts to operating funds at the other campuses will range from $3.9 million at Missouri University of Science and Technology in Rolla to $5.7 million at the University of Missouri-Kansas City. Extension services will lose $2 million, and multicampus programs will see state aid cut by $560,000.

Other higher education cuts include:

• $4 million for expanding MU medical school residency programs in Springfield.
• $2 million to expand collaborative dental and pharmacy programs in Joplin between UMKC and Missouri Southern State University.
• $1.6 million for engineering education programs offered by Missouri S&T in Clay County and in collaboration with Missouri State University.

Greitens did not cut funding for public school classrooms, but withheld $8.6 million from school transportation funding. Other large cuts include $4.4 million for the Missouri Technology Investment fund, $3 million from tourism advertising and $3.8 million for biodiesel production incentives. The new spending restrictions are in addition to $200 million in withholdings Gov. Jay Nixon imposed before his term expired Jan. 9.

State colleges and universities are determining what they will do in response to the cuts, said Paul Wagner, executive director of the Council on Public Higher Education.

“We had a pretty good idea that something like this was going to be happening,” Wagner said. “We will be discussing at our next meeting what steps we will need to take to protect the classrooms and do the best thing we can for students.”

The cuts could mean a midyear tuition increase, he said. Whether that will be necessary will become clear when Greitens makes his formal budget proposal in February, Wagner said.

“Once we see the governor’s budget for 2018, we will have a fuller sense of what we are doing for a two-year period and that will inform our decisions as well,” he said.

Higher education always is a target when governors look for places to cut, Wagner said.

“Decision makers simply don’t have a lot of options when it comes to restricting state spending in the middle of the year,” he said. “Higher education presents a more flexible option, and that is what governors have tended to choose.”