State funding for Michigan’s 15 public universities will remain largely flat over the next fiscal year, according to a spending agreement reached last week by Republican lawmakers and Gov. Jennifer Granholm. Yet, because of a new funding formula, some universities will receive large increases in funding – Grand Valley State University, Oakland University and Saginaw Valley State University will each see increases in excess of 7 percent. The University of Michigan, Michigan State University and Wayne State University, however, will each receive increases of less than half a percent.
Unfortunately, while some schools will clearly benefit from this new funding formula, higher education funding will still not be adequate to meet statewide demands. This University, along with its counterparts in East Lansing and Detroit, has had to increase tuition substantially to maintain core academic services. No matter what new funding formulas are proposed, or how hard lawmakers try to free up space, the fiscal reality is that the state’s public universities will remain strapped for cash unless overall appropriations are increased. Furthermore, as long as higher education funding remains a discretionary budget item, it will not receive the attention or protection it deserves. Instead of toying around with funding formulas, the state should increase appropriations to higher education, and ensure stable funding by making higher education – like K-12 education – a nondiscretionary budget item.
Public universities play a vital role in preserving the well-being of the state’s economy. As it slowly sheds the manufacturing-intensive growth sectors of the ’70s and ’80s, Michigan’s economy screams out for a well-trained and diverse labor pool. In her state of the state address earlier this year, Granholm acknowledged the role public universities could play in such a transition. The quality and affordability of Michigan’s public universities will be deciding factors as the state strives to stay economically competitive. If there were ever a time for lawmakers to acknowledge the importance of a first-rate and genuinely public system of higher learning, it is now.
With this in mind, legislators should explore ways to remove higher education from the standard fiscal equation. If a steady flow of state funding is to be preserved, secondary education can’t sit next to road construction and park projects on the budget line. Public education is not expendable, and it shouldn’t be treated as such. If universities are to properly plan for the future, revenue from the state must be both abundant and predictable. Higher education should be permanently earmarked, its financing secured.
After his election to the U.S. House of Representatives, Rep. Joe Schwartz (R-Battle Creek) formulated a plan to do exactly that. In his proposal, Schwartz calls for the creation of a separate, restricted fund for universities, one safeguarded from political pressures and the erratic behavior of the business cycle. With this fund, the fundamental difference between education outlays (investments in the future) and discretionary outlays (one-shot spending) would be institutionally recognized. Eventually, when Michigan has a diverse, highly-educated workforce, top-caliber public universities and a thriving economy, the advantages of such planning will be evident.