With Michigan's top three budget experts meeting today to estimate Michigan's tax revenue, Gov. Jennifer Granholm and state lawmakers should have an idea of cuts they'll have to make to balance the budget - including possible cuts to higher education.
MSU Vice President for Governmental Affairs Steve Webster said if the estimate, which measures tax revenue for the 2003-2004 fiscal year, is going to require cuts to higher education, then the university is going to have to resort to tuition increases or lower quality of education.
"If the state hands down additional budget cuts to the university while student enrollment is exploding, tuition increases are really the only relief," he said.
Webster said with such increases, Michigan is on its way to privatizing public education. In 1972, 75 percent of Michigan's public universities' general fund budget came from state appropriations and the remaining 25 percent from tuition, Webster said. In 2002, it was a 50-50 split, he said.
"With this disinvestment by the state to public universities, this would be a big hit," Webster said, adding that it may create a trend where universities are funding more and more of their own budget through increased tuition.
State appropriations to public universities usually come from the state's own general fund. Mitchell Bean, director of the House Fiscal Agency, who will be at the conference, said he expects $600 million less for the general fund in the new fiscal year than last year.
The governor and Legislature decide where the money will be spent each year, including how much will be given to public universities.
This year, Michigan's public universities received $1.77 billion or about 20 percent of the general fund. If Bean's estimate is correct and higher education spending remains at 20 percent, public universities can expect to receive about $110 million less.
But Gary Olson, director of the Senate Fiscal Agency, said it's too early to say what exactly will happen to higher education spending next year. Olson will also be at the conference tomorrow.
State Treasurer nominee Jay Rising will join Bean and Olson. All three will enter the meeting with their own estimates and are expected to agree on a final number to give Granholm and the Legislature.
