LePage offers more state funding to continue university tuition freeze

Posted March 07, 2016, at 11:55 a.m.
Last modified March 07, 2016, at 7:39 p.m.

BANGOR, Maine — The University of Maine System hopes to hold in-state tuition flat for a sixth straight year, after Maine Gov. Paul LePage offered nearly $7.5 million in supplemental budget funding to help the system avoid an increase.

The UMS tuition freeze is unusual, if not unique, among public state higher education. According to a College Board survey, Maine is the only state in the nation to see a reduction in inflation-adjusted tuition during the past five years.

On average, the cost of public higher education has increased 13 percent, including a staggering 52 percent increase in Louisiana, the College Board found. Maine’s costs have decreased by 2 percent.

Throughout the freezes, UMS has been grappling with its bottom line, trying to close campus budget deficits without putting it on the shoulders of Maine college students. Early on in the budget process for 2016-17, system officials identified a $20 million budget gap across its seven campuses.

“Through a lot of hard work that the campuses have done, we’ve reduced that by a little more than half,” said Ryan Low, the system’s chief financial officer.

UMS officials were considering a 2.3 percent tuition hike to counter the deficit.

Last week, system leadership sat down with the governor and updated him on UMS’ financial status. In response, the governor drafted a letter in which he proposed $4.65 million in supplemental funding for the 2016-17 academic year. That is enough money to offset what the system would have made from its tuition increase. That funding also would set a new baseline for the system’s state appropriation, and would carry over into future years.

In addition, the governor offered $2.8 million earmarked for early college programs, a pre-law undergraduate program and an adult education scholarship.

That money would be proposed in a supplemental budget the governor would bring forward in January 2017, after the next Legislature is seated, according to the governor’s spokeswoman, Adrienne Bennett.

The full board of trustees will discuss the offer during its meeting next weekend, but finance committee members and system officials expressed strong support for the governor’s offer during a meeting Monday.

“Maine is the only state in the country to reduce the inflation-adjusted cost of a four-year public education over the past five years,” LePage wrote, “and much of the credit for that accomplishment is due to the system’s five-year tuition freeze.”

In his offer, LePage stresses the importance of UMS continuing its push toward One University, an effort to reduce overhead, rein in spending, increase cooperation and reduce redundancy across the system.

He also encouraged the system to create a long-term plan for investment in its campus facilities, and to pursue a bond initiative asking voters to help finance some of its backlog in infrastructure and maintenance projects.

Also during Monday’s meeting, the system’s seven campuses presented their budgets to trustees. The proposed funding boosts would be a boon for a system that without it — or a tuition hike — would be confronting a $9.5 million gap in its $521 million budget for 2016-17.

The largest share of that deficit was at the University of Southern Maine, which projected a $3.2 million gap. In 2014, system officials were predicting a $16 million structural deficit at that campus, leading to a series of controversial cuts.

“That is a huge achievement,” Low said. USM hopes to close its operating budget gap completely by fiscal year 2018.

The flagship campus in Orono faces a $1.8 million budget gap without the new revenue. That number could have been higher, but university officials have boosted efforts to court out-of-state students in recent years. Those students pay higher tuition than Mainers.

Last year, UMaine announced a new effort to draw students from other New England states by offering to match the in-state tuition of the students’ state land grant institutions. Five months ago, UMaine anticipated a $7.2 million budget gap, and began the work of finding reductions and pumping in revenue.

Low said that the University of Maine at Machias, University of Maine at Presque Isle and University of Maine at Fort Kent will be presenting budgets that aren’t balanced, and will need to be balanced using system reserve funds. Had the system not received the governor’s offer, six of the seven campuses would have needed to use one-time reserves.

In addition to the supplemental funding, the system expects to use $3 million it saved during its administrative review process to close this year’s deficit, as well as some reserve funds held by campuses.

The campuses will continue to tinker with their budgets until May, when the finance committee and full board are expected to review them and vote.

Follow Nick McCrea on Twitter at @nmccrea213.

 

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