MARCH 28, 2014 -- A deeper look into the 2014-15 budget package the House sent over to the Senate this month reveals an even bigger distrust of higher education than in years past. State public four- and two-year colleges are wincing from a de facto budget cut in the proposed package, as the amount the House has set aside for them is the same as it was in the current fiscal year budget.
It’s considered by some as a cut, since the line item amount does not reflect inflation, growth in costs, or an overall growth of the state’s total and General Fund budgets, which grew by billions and hundreds of millions, respectively, over the current fiscal year.
In the current 2013-14 state budget, colleges and universities received a base budget of $336 million, while technical colleges got $106 million and the S.C. Area Health Education Consortium received $9.6 million, according to Julie Carullo of the state Commission on Higher Education.
Over the preceding seven budget years, according to state financial records, two- and four-year public colleges have seen their line items reduced by cumulative 37 percent. In 2009-10, for example, colleges and universities had $402 million in appropriated state funds, which dropped to $318.2 million the next year and now is at $336.2 million. For technical colleges, the current year funding of $105.7 million has almost returned to the 2009-10 level of $113.5 million. [See this chart for FY10 to FY14 numbers.]
According to Kelly Steinhilper, spokesman for the S.C. Technical College System, a three-part series of cuts dating back to the beginnings of the Great Recession removed close to 48 percent of direct state support for the tech school system.
Steinhilper said that some of that loss in funding was mitigated by the increase in enrollment technical schools enjoyed during down financial times when workers, some on unemployment, lined up for job training courses.
“They want the product, it’s what we do – providing real skills and workforce training,” she said, pointing to an 83 percent placement rate of students hired into jobs related to the training they received at tech schools.
At the traditional colleges and universities, according to one lobbyist, big research schools are succeeding “in spite of the General Assembly.”
That lobbyist said that one of the saving graces for USC and Clemson was the interest and revenue that their currently successful football programs engender.
Additionally, the lobbyist said, that if “Charleston” were not such a big draw or “brand” in marketing parlance, then the College of Charleston and The Citadel might not be doing as well as they are.
Another higher-education lobbyist complained that despite the flat-lining of budget amounts, tech schools are coming out better than their institutions due to workforce preparedness spending by the state.
Sources in the Senate said there was a good chance that some money would be added back to the higher education line items, but the magnitude wasn’t known.
Suspicious minds
State Rep. Brian White (R-Anderson), chairman of the House Ways and Means Committee that takes the first crack at the state budget, is not seen by many as a big fan of higher education.
With a solitary year of college at Erskine under his belt, White has for the second year pelted higher education budget requests with sharp questions during budget hearings.
In a March 2 story in The Chronicle of Higher Education, White is quoted as saying that two-and four-year schools are doing a better job at taking care of their expansion needs than they are taking care of their mandate: maintenance of existing buildings and providing a quality education to students.
“I’m not crazy,” said White. “We’re doing something right in higher education in South Carolina, otherwise why are the BMWs, the Boeings, and all the other heavy-hitters coming here to South Carolina?”
The House’s suspicions of higher education, according to five budget watchers, can be seen in how it handled its annual capital reserve fund, which represents 2 percent of the previous year’s General Fund tax collections.
In the 2014-15 House budget package, that fund was worth more than $117 million. Historically, the lion’s share of the fund -- up to about half -- has gone to higher education. But in the budget proposal sent to the Senate, the House set aside less than 10 percent -- only $10 million. Of that amount, $5 million is slated for anaerospace training center at Trident Tech in North Charleston.
Indirect help to tech schools
Projects like the Boeing-related center and other tech school-based workforce preparedness efforts, such as readySC, funnel more state funding to tech schools that doesn’t directly add to the tech system’s bottom line.
That indirect push appears to be in line with state Commerce Secretary Bobby Hitt’s claim that the best way to rebuild the state’s economy is through manufacturing jobs.
The value of higher education
Students getting retrained for less then $10,000 at a tech school and landing a good-paying job is good for the state. If the job pays $40,000, that’s a good return on investment, according state Rep. Phil Owens (R-Easley), chair of the House Education Committee.
But is it the best way over the long term, some ask? Consider a nugget embedded on Clemson’s website, quoting a national watchdog group, that says a Clemson graduate will earn $872,000 more over their lifetime than someone who doesn’t seek a degree at all.
Bill Davis is editor and publisher of Statehouse Report. He can be reached at: billdavis@statehousereport.com.
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