Is the University of North Carolina system really going to shut down one of its 16 campuses? Outgoing UNC President Erskine Bowles raised the possibility at his final Board of Governors meeting in November.
His statement not only drew headlines, it may also have focused policymakers on some of the unpleasant alternatives the General Assembly will face as it considers ways to cut the $2.7 billion university system budget.
Joni Worthington, a UNC system spokeswoman for Bowles, said the outgoing president’s “comment about closing a campus was simply a comment, not a proposal. [It is] something that would only have to be considered if cuts needed to be made in the 20- to 30-percent [range].”
Bowles, in fact, asked campuses to come up with proposals for cuts of between 5 percent and 10 percent. The hope, Worthington said, was that if the UNC institutions suggested cuts on their own, the 2011 General Assembly might provide the flexibility to implement them.
“There is no cookie-cutter approach” across the campuses, though, as each school has a different mission and different capstone programs, she said. It’s up to each school to determine “what programs are central to their mission and [then they must] be strategic about their cuts to do the least long-term damage.”
To be sure, Gov. Bev Perdue will have much to say about her priorities when she releases her budget in the coming year. But the General Assembly has the final say on spending, and the newly elected Republican majority has provided scant details to far.
Sen. Richard Stevens, R-Wake, who currently serves on both the Appropriations Committee for Higher Education and the Higher Education Committee, said that the General Assembly has made “no decisions yet concerning the budget. Everything is on the table, [but] it is very premature to be talking about any specifics right now.”
In part, members are hesitant to make specific recommendations before they take office in January. At that time, the speaker of the House and the Senate president pro tem must be elected. After those elections, committees will be appointed, at which point specifics can be discussed, Stevens added.
Rep. Thom Tillis, a Mecklenburg County Republican and nominee for speaker of the House, told Carolina Journal that it’s “promising that Mr. Bowles took the time to find areas where they know they’ve got to tighten up, because everyone else is. That’s a good first step.”
“There’s probably not a part of the budget that would be untouched by necessary reductions,” said Sen. Phil Berger of Eden, who was nominated by Republicans to become the Senate president pro tem. “I think [Bowles] has done a good job over the past several years in squeezing out some administrative savings in the universities. That doesn’t mean that we’re not going to look [at the universities], because we’re probably going to be in a position where we’re going to have to find savings in all parts of the budget.”
Even so, Rep. Marilyn Avila, R-Wake, said at a Nov. 15 John Locke Foundation luncheon address, “We are not going to decimate the university system, which seems to be a fear that is residing with everyone now.”
Worthington said cuts at 10 percent would reduce “the number of personnel employed [by 1,700 jobs], the programs offered, class size, available academic and support services, and library hours,” though how that plays out on each campus would be different.
The campuses and Board of Governors are looking at alternatives, including a tuition increase. Recently, UNC-Chapel Hill’s Board of Trustees OK’d the maximum tuition increase allowed — 6.5 percent for undergraduate resident students. The Board of Governors still has to give it their stamp of approval.
Tuition increases also are being considered at other institutions, Worthington said, “especially if state funds are cut.” She did note that there is a “question about whether campuses could retain [the] extra revenue, or if it would go to the General Fund.” The Board of Governors hope the campuses could keep the additional money.
Other options could include increasing the tuition differentials between campuses, so that the flagship institutions — UNC-Chapel Hill and North Carolina State University — could generate additional money by charging significantly more than other UNC schools. That has not been discussed.
The plan, adopted by the board, retains the 6.5 percent cap on in-state tuition increases. Out-of-state students and graduate level students could be charged more, Worthington said.
Nor has there been any discussion of lifting or adjusting the 18-percent enrollment cap on out-of-state freshman students — whose costs of attending the universities are not meant to be subsidized by state taxpayers. Enrolling more out-of-state undergraduates could ease the drain on the state’s coffers.
Six higher education campuses in the UNC system graduate less than a fifth of their student population in a traditional four-year cycle. Seven schools fail to graduate half of their students in six years. When asked if there was any consideration about tying incentives to graduation rates instead of enrollment for the campuses, Worthington did not directly answer the question. Instead, she said, “The Board [of Governors has] clearly signaled they wanted enrollment tied to retention.”
Jay Schalin, senior writer for the John W. Pope Center for Higher Education Policy, says UNC’s long-term budget expansion “is driven mainly by enrollment growth … The system seems to be planning on a large increase in enrollment this year, since it’s asking the legislature for a whopping $55 million to handle the growth.” There is a plan, he said, to tie enrollment growth to performance, but that this “will do little” to stop the expansion.
Schalin says money could be saved by tying “need-based aid to academic qualifications, so that low-income students who proved themselves in high school or the community colleges get all the money they need, but low-income students who lack reasonable academic credentials only qualify for enough aid to go to the community colleges.”
This way, “nobody is denied access to some form of higher education.” If the state adopted this kind of a system, Schalin said, “the state could easily save at least $50 million the first year, and much more in subsequent years.”
Amanda Vuke is a Carolina Journal editorial intern. Associate Editor David N. Bass contributed research to this report.