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MSU, U-M heads discuss finances

November 26, 2003

In light of the struggling economy and concerns about tuition rates, MSU President M. Peter McPherson and University of Michigan President Mary Sue Coleman participated in an hour-long discussion of the universities' budget woes Tuesday afternoon, airing on WKAR 870-AM.

Last year, the total cuts to Michigan universities were around $160 million coupled now with a state deficit of $920 million.

McPherson said the state most likely will cut 6 percent or less to Michigan universities next year. Schools that keep tuition under a nonspecified percentage will receive a smaller cut.

"It is out and about in the media, but it's a number that's real," McPherson said. "I wonder if (the state's) got the money to only make a 3-percent cut, then maybe they ought to start there."

Budget cuts have forced MSU to reduce 400 jobs in recent years, McPherson said.

Coleman said about 30 years ago, students paid a much smaller tuition at Michigan universities because the state picked up two-thirds of the tuition cost.

"Now, the state is (picking up) less than a third of the cost and families are putting up two-thirds," she said.

McPherson said he agreed.

"There's no indication that we worry the next 25 years from now the state is paying 25 percent or less," he said.

The reason the state is providing less tuition funding, McPherson said, is pressure on Medicare and on prisons.

"Other areas have grown, and higher education, in real terms, hasn't grown nearly as much," McPherson said.

Both universities have had to deal with cuts as they came, McPherson and Coleman said.

And Coleman said any help of easing the burden of universities' increases is welcome at any time - but not expected.

"Both of us have been very responsible on the issue of tuition increases over the past eight years. This is trouble now," she said. "We all need to recognize that this is deeply, deeply important for the future of both of these universities and, in fact, for all of higher education in Michigan."

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