State budget could freeze IU funding

IU President Adam Herbert and Indiana Gov. Mitch Daniels don't exactly see eye to eye on the state's funding for IU.\nHerbert would like $80 million more for the University in the 2005-2007 Indiana state budget.\nDaniels would like IU and other public state universities to hold steady and receive the same amount of state funding they received two years ago.\nA slight difference of opinion, so to speak.\nThe incoming battle over Indiana's two-year state budget, which will fund everything from the Department of Corrections to Medicaid, from social services to transportation, will become a battle over funding for Indiana's public universities. As the state tries to slow spending in an attempt to balance the budget and lacerate the state deficit, IU officials are working to ensure what they consider to be adequate funding for the next few years.\nHerbert has twice asked the Indiana General Assembly to allocate $1 billion for the University, representing an $80 million increase from the current budget in state funds. But such an increase could meet resistance given Daniels' Jan. 18 state of the state address, when he proposed an across-the-board freeze on state finances, including all levels of public education.\n"Education, both K-12 and postsecondary, must play essential roles in fiscal recovery by managing temporarily with current levels of state funding, no less but no more," Daniels said in his address.\nIU spokesman Larry MacIntyre said Herbert will meet with Daniels sometime this week to discuss funding concerns for the University.\n"President Herbert recognizes that the state is facing serious fiscal problems," MacIntyre said, adding Herbert "appreciates that Gov. Daniels is trying to minimize the impact on both K-12 schools and higher education."\nAbout one quarter of IU's $2.1 billion operating budget is provided by state government. Although he is not seeking money for new or expanded programs, Herbert is asking for the additional funding to support continued research activities and repair and renovation projects. \n"IU's research activities, especially in the life sciences, are helping to spark economic growth in Indiana," MacIntyre said. "As for repair and renovation projects ... the longer these projects are delayed, the more critical -- and expensive -- they become."\nJ.T. Forbes, IU's executive director of state relations, said it was his understanding that the IU campuses currently are working to identify options that will allow them to maintain quality in the face of both potential stagnation and marginally higher funding levels.\n"A sluggish state economy, combined with a tight state financial situation, makes for a very difficult environment for higher education," Forbes said. "While universities are recognized as part of the solution to Indiana's economic woes, it will be difficult for elected officials to balance the budget and increase funding for the state's many needs and priorities." \nInterim IU-Bloomington Chancellor Ken Gros Louis expressed similarly gloomy expectations.\n"It's a year where, given the state's financial situation, we're hoping we can pull our own because it isn't there," Gros Louis said. "If the state has no money, there's no money."\nWhile not constituting an explicit cut in funds, Daniels' proposed freeze at current levels shakes out weaker buying power. \n"A freeze of university funding really means a cut for the University because energy, health care and other costs are rising and beyond the control of IU," state Rep. Matt Pierce, D-Bloomington, said. "The General Assembly should try harder to better fund higher education because it is one of the keys to Indiana's economic development and long-term prosperity."\nBut House Ways and Means Budget Chairman Larry Buell, R-Indianapolis, previously told the Indiana Daily Student (Jan. 12, 2004) that the state budget is stretched too tight to comply fully with Herbert's request. He said his committee probably will not approve the proposal "to the extent that (Herbert) made the request, but not because of an inadequacy of his proposal, but a shortage of funds at the state level."\nPierce said he believes the University's budget request recognizes the state's difficult fiscal condition and has very modest goals for the next two years, but nonetheless he said the General Assembly should do all it can to meet this budget request.\nAt this point, IU officials are quick to dismiss as premature any talk of tuition increases or additional student fees.\nMacIntyre said it is too early to make any predictions regarding possible student fees or increases in tuition for the next year. \n"First, we must determine the level of state support that will be provided next year," he said.\nGros Louis said he expects the IU board of trustees to vote on tuition and fees for the next academic year in March. \nBut Forbes said a flat-line higher education budget will create a gap between current state-funding levels and the level of resources required to meet increases and other uncontrollable costs.\n"If higher education funding cannot be increased beyond the levels recommended by the governor, we will have to fill the funding gap by cutting our costs, increasing revenues or some combination of these," Forbes said. "It is still too early in the legislative process to predict the final outcome on state funding. The governor's budget gets the conversation started, but it takes months of deliberation and debate to arrive at a state budget."\n-- Contact Senior Writer Tony Sams at ajsams@indiana.edu.