Ransdell airs concerns with state representatives over budget

President Gary Ransdell speaks about the effects of the state wide budget cuts in Frankfort on Thursday morning at the state capital building. The budget cuts could increase tuition by at least 3 percent. Jacob Hurdt/HERALD

Jacob Dick

On Thursday, Feb. 25, President Gary Ransdell took his turn before the state House’s Budget Review Subcommittee on Postsecondary Education in Frankfort to discuss concerns of the university from Gov. Matt Bevin’s proposed budget.

Ransdell discussed the possibility of at least 20 imperiled programs, jobs losses and tuition raises at the university while college students protested on the Capitol steps outside.

“We’re here doing what you expect us to do,” he said. “The cuts would hinder the ability to do the very thing that the governor and general assembly expects us to do in terms of productivity.”

During his testimony, he presented legislators with a study completed by Budget Policy and Priorities that showed postsecondary education funding in Kentucky was still at levels far below the pre-recession levels of most states. The study showed that state spending on higher education in Kentucky decreased 27.6 percent between 2008 and 2015: a $2,949 difference per student.

Kentucky decided to decrease funding during the budget session last year at a time where other states decided to raise the funding for state educational facilities.

“Because [of] the money that’s been cut to higher education over the last eight years … there is no more across-the-board option,” Ransdell said. “For us to address these cuts, we’re going to eliminate … services our communities depend on because we are a public university.”

Ransdell also said there would be an expected 3 percent rise in tuition cost for students next fiscal year as outlined by the Council of Postsecondary Education. He warned that although tuition raises were essential in maintaining the budget, more tuition raises would come from the impending budget cuts, pushing the university out of its competitive price point and increasing debt for students.

He also tried to convey to representatives where universities would look to make cuts to comply with the new budget. Ransdell explained that state appropriations made nearly 18 percent of the entire budget with most of the remainder coming from restricted endowments and gifts. Restricted funds can only be used for specific purposes as described by the donor, and Ransdell said they couldn’t be used to help with budget cuts.

“To say that the cuts are softened … when you take it as a percentage of the total budget is simply an inaccurate extrapolation,” Ransdell said.

Ransdell said cuts would most likely be made within the faculty budget, which makes up more than 60 percent of the university’s overall budget.

“Yes, the cuts are real, and they will have to come from state appropriations, which means there will be job loss on the campus,” Ransdell said.

The budget review subcommittee has heard similar concerns from other education officials this month like University of Kentucky President Eli Capilouto and Kentucky State University President Raymond Burse. Capilouto called the cuts in the governor’s proposed budget “draconian” during his testimony.

Some representatives seem to be considering arguments made by Kentucky’s educators. House Speaker Pro Tem Jody Richards, D-Bowling Green, said the House might be sympathetic to universities when it makes its own proposal.

“I believe the House will decrease the amount of cuts,” Richards said. “I don’t know how the Senate will look at it, but we are trying to be a pro-education budget.”

Sen. Gerald Neal shared a similar sentiment when he spoke before students who were protesting at the state Capitol building Thursday while educators were still talking to the subcommittee.

“I appreciate that you are here, but you are preaching to the choir,” Neal said. “We are determined that these cuts won’t happen, but there is one house on the Kentucky River that needs to hear this. That’s where the governor lives.”

Although most of the attention being given to the proposed budget has centered around funding cuts, there has also been concern about the addition of performance-based metrics to funding standards.

Rep. Richards said the Legislature would need to consider the effects of the changes.

“Performance metrics need to be held off for awhile,” Richards said. “It could be devastating to bond ratings due to unknown amounts of funding from year to year, and bond raters won’t know what to do right away.”

Ransdell raised this concern in his testimony to representatives, asking for a delay in performance metrics for higher education funding. He said that without guaranteed revenue streams, bond raters would be less likely to give acceptable bond rates for the university to use in funding projects.

He added that increasing tuition and fees cannot hope to make up missing state pension funds with Bevin’s proposed cuts to higher education.

“I know that bailout has to occur, but it is confounding to us that those who are driving the economy and filling the workforce … have to take such a responsibility in that regard,” Ransdell said.