College Affordability Plans
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College Affordability Plans

Date: October 6, 2008
By: Sarah D. Wire
State Capitol Bureau
Links: Grapevine Project data

JEFFERSON CITY - State budget shortfalls in the late 1990s led to deep cuts in higher education funding which have yet to be recovered.

Although both major party gubernatorial candidates have announced plans to make higher education more affordable, how much of an impact a new governor has on the situation could be limited by several factors including budget constraints and the appropriations process.

Spokesmen for each of the gubernatorial candidates have said that the state needs to increase funding for higher education, although their plans as to how differ greatly.

But extra funding is dependent upon the state's budget. And at least one state budget expert suggests that would be a problem.

"Its going to be very difficult for anyone to do a significant increase," said Amy Blouin, executive director of the Missouri Budget Project -- a non-partisan, non-profit  group that analyzes state budgets and encourages a public policy voice for low-income Missourians. "Whoever is in charge will see significant budget issues."

Missouri's higher education budget was cut in 2003 during a steep decline in state revenue. During the 2002 appropriations process former Gov. Bob Holden recommended tax hikes to help balance the budget, but the Republican-led legislature made a 10.2 percent cut.

The appropriated amount for the current budget year, $936.5 million, is less than the amount appropriated in 2001, which was $960.4 million.

Missouri, which ranked 47th in the nation for annual higher education appropriations per capita in fiscal year 2008, according to a study by  the Grapevine Project at Illinois State University, is falling behind the states that surround it, said John Harms, former state chapter president of the American Association of University Professors and a current sociology professor at Missouri State University.

The Grapevine Project, which provides an annual compilation of data on state tax appropriations for higher education, ranks only New Hampshire, Colorado and Vermont as providing less per capita appropriations than Missouri.

Appropriations for higher education have increased in the state during the last two years because money that once went to fund Medicaid became available following the cuts made by the state legislature in 2007, Harms said.

"It's a matter of prior commitment," Harms said.

The funding cuts led to a series of tuition increases, which have affected college affordability, one of the leading issues of the election.

Paul Wagner, the deputy commissioner for the Missouri Higher Education Department, said many colleges implemented "huge increases" in 2002 and 2003 when the higher education budget was cut.

Because money appropriated by the state was less than the rate of inflation, "institutions tried to make up some of that money by raising tuition," Wagner said. "There are some fixed costs that every institution has to meet like fuel and equipment."

He said after those two years tuition has increased mostly as the rate of inflation with the largest change since 1998 being at North West Missouri State and the University of Central Missouri.

Wagner said with the national economic situation the state budget may be tight and higher education will only receive more money if the governor and the legislature make it a priority.

"Certainly there's not going to be a lot of money sitting in the state coffers," Wagner said.

Wagner said the state has not raised as much revenue so far this year as it did during the last fiscal year.

"The economy isn't in very good shape and state revenues are starting to decline," he said.

A new law, which went into effect in the fall of 2008 caps tuition increases to the rate of inflation. Wagner said if appropriations don't match inflation and colleges can't pass those costs to students "they're going to be coming up short as far as inflationary costs."

In April the UM System Board of Curators voted to increase tuition 4.1 percent beginning with the summer semester. The increase was consistent with the rate of inflation at the time.

The 2007 sale of the Missouri Higher Education Loan Authority provided a new twist on the status of higher education funding.

The governor touted the sale as an avenue to finance much needed building expansion on college campuses while critics worried the liquidation of assets would keep the company from being able to provide loan interest loans to students as tuition prices continue to rise.

Upheaval in the credit market has led the loan agency to miss about $8.5 million in payments to the state over the last several months.

Funding for higher education has increased across the country within the last few years to a national average of 7.5 percent, while Missouri's fiscal year 2007 appropriations was 4.4 percent of the state budget.

"Relative to the surrounding states we're still falling behind even though we're increasing," Harms said.

The budget submitted by the governor each year must be approved by an appropriations committee and then by the legislature.

So when it comes to plans to give more money to higher education, Harms said, "the governor can say it's a priority and can submit a budget but the appropriations committee can cut it out. What really matters is what happens in those appropriations meetings."

According to an October 3 news release from Commissioner of Administration Larry Schepker, the 2009 fiscal year-to-date net general revenue collections declined 0.9 percent compared to 2008, from $1.91 billion last year to $1.90 billion this year.

Schepker stated that the decline in general revenue is cause for concern but was unsurprising given recent developments in the national economy. Missouri's fiscal year begins July 1.

Candidate Positions on College Affordability

Candidates for Governor

Hulshof also supports an initiative where donations made by businesses to math, biotechnology, chemistry and engineering degree programs would be matched 2 to 1 by the state. The plan would also create a fund to attract top researchers to Missouri institutions.

Candidates for Lieutenant Governor

Candidates for Secretary of State

Candidates for State Treasurer


Candidates for Attorney General