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Lawmakers question Pence's higher-ed cuts

Budget director cites increases

INDIANAPOLIS – Several fiscal-minded lawmakers on the State Budget Committee are wondering why Gov. Mike Pence’s administration is making cuts to higher-education budgets.

“Whatever we take from them could end up next year as a tuition hike,” Sen. Karen Tallian, D-Portage, said during Thursday’s meeting in Fort Wayne.

Committee chairman Sen. Luke Ken­ley, R-Noblesville, raised the top­ic. He said that during budget dis­cus­sions in 2013 for the current bi­en­nial budget, lawmakers came to an oral agreement with universi­ties to increase state funding in ex­change for them holding down tuition increases.

“I hope if the picture brightens, there is some sort of protection for higher education,” Kenley said.

Fiscal year 2014 ended in June, with the state taking in less tax rev­e­nue than the year before. Collections were lagging in De­cem­ber when Pence made further cuts to state agencies and al­so required universities to revert 2 percent of their funding.

A reversion is when an entity purposely doesn’t spend all the money appropriated to it, instead returning it to the state’s main checking account.

In this case, that saved the state $27.5 million and cannot be recouped by the universities. Of that, $820,000 came from IPFW.

In comparison, state agencies had to hold back 4.5 percent of their budgets.

State Budget Director Brian Bailey said that even after the higher-education cut, universities as a whole received a 3 percent funding in­crease plus $200 million in capital expenditures.

He said the administration has al­ready told universities to hold back another 2 percent in the newly started fiscal year.

Bailey called the projections are “overly optimistic” and said the state wants to be prudent in managing funds because it is easier to cut at the beginning of a spending year rather than the end.

He said that if revenues are at projection by June, the money will be released to universities.

nkelly@jg.netINDIANAPOLIS – Several fiscal-minded lawmakers on the State Budget Committee are wondering why Gov. Mike Pence’s administration is making cuts to higher-education budgets.

“Whatever we take from them could end up next year as a tuition hike,” Sen. Karen Tallian, D-Portage, said during Thursday’s meeting in Fort Wayne.

Committee chairman Sen. Luke Ken­ley, R-Noblesville, raised the top­ic. He said that during budget dis­cus­sions in 2013 for the current bi­en­nial budget, lawmakers came to an oral agreement with universi­ties to increase state funding in ex­change for them holding down tuition increases.

“I hope if the picture brightens, there is some sort of protection for higher education,” Kenley said.

Fiscal year 2014 ended in June, with the state taking in less tax rev­e­nue than the year before. Collections were lagging behind in De­cem­ber when Pence made further cuts to state agencies and al­so required universities to revert 2 percent of their funding.

A reversion is when an entity purposely doesn’t spend all the money appropriated to it, instead returning it to the state’s main checking account.

In this case, that saved the state $27.5 million and cannot be recouped by the universities. Of that, $820,000 came from IPFW.

In comparison, state agencies had to hold back 4.5 percent of their budgets.

State Budget Director Brian Bailey said that even after the higher-education cut, universities as a whole received a 3 percent funding in­crease plus $200 million in capital expenditures.

He said the administration has al­ready told universities to hold back another 2 percent in the newly started fiscal year.

Bailey called the projections are “overly optimistic” and said the state wants to be prudent in managing funds going forward because it is easier to cut at the beginning of a spending year rather than the end.

He said that if revenues are at projection by June, the money will be released back to universities.

nkelly@jg.netINDIANAPOLIS - Several fiscal-minded lawmakers on the State Budget Committee Thursday questioned why Gov. Mike Pence’s administration is making cuts to higher education budgets.

“Whatever we take from them could end up next year as a tuition hike,” said Sen. Karen Tallian, D-Portage.

Sen. Luke Kenley, R-Noblesville – chair of the committee – raised the topic during Thursday’s meeting in Fort Wayne.

He said during budget discussions in 2013 for the current biennial budget lawmakers came to an oral agreement with universities to increase state funding in exchange for them holding down tuition increases.

“I hope if the picture brightens there is some sort of protection for higher education,” Kenley said.

Fiscal year 2014 ended in June, with the state taking in less tax revenue than the year before. Collections were lagging in December 2013 when Pence made further cuts to state agencies and also required universities to revert 2 percent of their funding.

That saved the state $27.5 million, and cannot be recouped by the universities. Of that, $820,000 came from IPFW.

A reversion is when an entity purposely doesn’t spend all the money appropriated to it, instead returning it to the state’s main checking account.

In comparison, state agencies had to hold back 4.5 percent of their budgets.

State Budget Director Brian Bailey said even after the higher education cut, universities as a whole received a 3 percent funding increase plus $200 million in capital expenditures.

And he said the administration has already told universities to hold back another 2 percent in the newly-started fiscal year.

Bailey said he thinks the projections are “overly optimistic” and the state wants to be prudent in managing funds going forward because it is always easier to cut at the beginning of a spending year rather than the end.

But he also noted that if by June 2015 revenues are at projection, the money will be released back to higher education institutions.

nkelly@jg.net

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