With Republican Gov. Rick Snyder’s presentation of the 2013 fiscal year budget two weeks away, University officials say they are optimistic about a possible uptick in higher education and revenue-sharing allocations for next year.

The budget, which Snyder will present on Feb. 9, will be released as the state faces its first surplus in years after a spate of cuts to higher education funding, including a 15-percent cut to the state’s 15 public universities last year.

Coupled with an improved economy statewide, the surplus has given University officials and state representatives hope that the University budget could grow for the 2013 fiscal year.

Cynthia Wilbanks, the University’s vice president for government relations, said she is “cautiously optimistic” about an increase in higher education funding for next year. She added that her optimism stems from the state’s economic rebound and Gov. Snyder’s pledge last year to expand higher education funding when the state became financially capable.

“What we are looking for is renewed investment, and there may be opportunities this year that we have not seen in many, many years,” Wilbanks said. “ … The University is eager to see new investments in its public universities.”

Wilbanks said she was unsure of the amount by which the allocations might increase, or if they will at all. Last year, the University received about $268 million following the 15-percent funding cut across all state universities. In response, the regents voted in June to raise tuition 4.9 percent for out-of-state students and 6.7 percent for in-state students.

This year’s budget may introduce formula funding, which relies on performance metrics to determine how funds are distributed to each state university. The metrics are based on factors like graduation and freshman-retention rates, which previously had no impact on the allocation of funds to the state’s 15 public universities.

University officials have long questioned formula funding, but Wilbanks said she would not necessarily be opposed to the implementation of performance metrics.

In November, the University’s Board of Regents sent a letter to State Budget Director John Nixon, developer of the formula, stating that they felt the model might not account for the University’s value to the state in terms of its more specialized endeavors, like research.

University President Mary Sue Coleman echoed this sentiment in an interview last month, saying that the metrics model would not best serve the University’s interests.

“I’ve never seen a formula that could be fair,” Coleman said. “I’m very concerned since the funding level in the state is the bottom 10 percent in the nation among states, that somehow we would do harm to institutions right now by saying, ‘Ok, suddenly we’re going to have a formula that seems willy-nilly.’”

State Rep. Joan Bauer (D–East Lansing), vice chair of the State House of Representatives Higher Education Appropriations Subcommittee, predicted only a small percentage of the state budget will be directed to the performance-based model, while the majority of higher education funding would be allocated under the traditional system.

Bauer said that it would not be fair to fully instate a new performance-based model in the budget this year since universities haven’t had adequate time to prepare for the changes.

“To me it wouldn’t be fair to drop this on this current budget when they haven’t had ample time to say, ‘Ok, here are the things they’re going to look at, ’” Bauer said. “There’s still lots of moving parts.”

State Rep. Jeff Irwin (D–Ann Arbor) said he thought the performance-based model might be problematic since it could preclude schools that do not perform well from improving in the future.

“You want to reward the best and brightest,” Irwin said. “But how do you come up with a fair way to do that — how do you come up with a (method of) performance-based pay for teachers that doesn’t ultimately just pay the teachers based on the quality of the students, not based on the quality of the teaching.”

Regardless, Irwin said education is the state’s most important mission and he hopes to see increased allocations to higher education in the budget.

“We should be making (it) a priority,” he said. “It’s the most important thing the state does. It’s the biggest determinant to our economic prosperity long-term … there’s really no excuse for the cuts that we’ve passed along to college students and young kids in the last decade.”

—Tui Glasgow-Rademaker contributed to this report.

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