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The State Should Not Balance the Budget on Backs of College Students

Austin - Following the release of the Texas Higher Education Coordinating Board's Legislative Appropriations Request (LAR), State Rep. Mike Villarreal warned against abandoning the state's commitment to higher education as the Legislature seeks to balance the state budget.  Under the 10% budget cut proposal in the LAR, TEXAS Grants would be available to 23,745 fewer college students compared to today.

"We must invest in the higher education system we need for a prosperous economy," said Rep. Villarreal, a member of the House Appropriations Committee on Education, after reviewing the proposed budget cuts in the Coordinating Board's LAR. "We must not balance the budget on the backs of college students and their families at a time when they are struggling to survive the economic downturn ."

The Governor, Lt. Governor and Speaker of the House recently directed state agencies to prepare draft budgets for 2012-2013 that include options for cutting agency funding by 10%.  The state is facing an estimated budget shortfall of $18 billion for the next biennium. State leaders recently approved 5% budget cuts for the current biennium, yielding approximately $1 billion in savings.  The limited revenue produced by such budget cuts, combined with the funding needs and consequences identified by state agencies, suggest that the state will need additional strategies beyond budget cuts in order to balance the budget.

The Coordinating Board's LAR and other recent reports demonstrate the consequences of seeking significant budget cuts in higher education:

- The Coordinating Board was forced to include financial aid in its recommended cuts because it represents the majority of the agency's budget.  If the Legislature accepts the 10% cuts in the Coordinating Board's LAR, and fails to fund the Coordinating Board's request for extra funding, 23,745 potential college students from low - and moderate-income families will be denied TEXAS Grants and the opportunity to advance their education.  During the current 2010-2011 biennium, the state is providing TEXAS Grants to 113,228 students, including nearly three of every four new eligible students.  According to the Coordinating Board, the proposed 10% cut would allow the state to serve only an estimated 89,483 students during the 2012-2013 biennium, denying a TEXAS Grant to approximately two of every three new eligible students. Funding for additional financial aid programs, such as the Texas Educational Opportunity Grant (TEOG) and Tuition Equalization Grant (TEG), would also face severe cuts.

- The Coordinating Board recently released its "Accelerated Plan" for meeting the state's higher education goals identified in 2000 in the state's higher education blueprint, "Closing the Gaps by 2015."  However, the LAR for 2012-2013 does not include a request for funding all the strategies in the Accelerated Plan.  Achieving the goals in Closing the Gaps would assure the state's continued prosperity and produce an estimated one million new jobs by 2030, but we will not accomplish our goals if the state does not fund the plan to achieve them.

- The Coordinating Board's "Formula Funding Recommendations for 2012-2013 Biennium" reveal that the state must provide an additional $730 million in formula funding in order to simply continue paying for growing enrollment in community colleges and universities.  If the state fails to maintain funding for enrollment, colleges and universities are likely to make up the difference by increasing students' tuition and fees at a time when students and their families can least afford it.

- The Coordinating Board reports that every dollar invested in higher education produces a return of eight dollars to the state.  Higher education is one of the key engines of our state economy. Maintaining the state's commitment to higher education is a critical strategy for pulling the state economy out of the downturn and then capitalizing on opportunities following the economic downturn.

"We will eliminate any waste we find in the budget and stretch our dollars further.  But ultimately, closing such a big budget shortfall will require a balanced approach instead of just eliminating programs that families need now more than ever,"  said Rep. Villarreal.  "We must make sure that when we 'tighten our belt' we don't actually tighten the belt of families struggling to put their kids through college or put a chokehold on our economic growth."