The University Record, May 22, 1995

State appropriations picture looks brighter

By Julie Peterson
News and Information Services

Michigan universities made some headway in Lansing last week when the Senate Appropriations Subcommittee on Higher Education voted to allocate an additional $25 million to the state's 15 public institutions.

But shrinking state revenue projections for fiscal year 1996 will likely make it difficult for the Legislature to come up with the extra dollars.

"We have succeeded in building a great deal of support in the Senate not only for the University of Michigan, but for all of higher education in the state," said Walter Harrison, vice president for university relations. "President Duderstadt has visited personally with nearly half the Senate membership and his message--that the state's universities are long overdue for funding to help make up for the sub-inflation increases of the past few years--was well received.

"However, the revenue projections just out are going to make it extremely difficult for members to vote to exceed more restrictive budget targets set last Tuesday. But we'll keep working hard to make our case."

In April, the House had voted to adhere to Gov. Engler's funding recommendations, which called for three institutions--Michigan State, Western Michigan and Grand Valley State--to receive increases ranging from 6 to 7.8 percent, while the other 12 universities would get just 3 percent. An amendment sponsored by Rep. Morris Hood, D-Detroit, withheld $8.3 million from the U-M pending the development of a plan that would bring the proportion of in-state undergraduate students to 70 percent by fall 1995.

On May 16, the Senate subcommittee, chaired by Sen. John J.H. Schwarz, R-Battle Creek, voted to pass on to the full Appropriations Committee a bill that would leave intact the increases for the three universities singled out in the House plan, but would add an additional 3 percent for the other 12. The bill eliminated any tie between funding to the U-M and in-state/out-of-state student ratios. Under the proposed bill, the U-M would receive a total increase of 6 percent, or about $16 million, in state appropriations over fiscal year 1995.

"We are extremely grateful for Senator Schwarz's leadership and for the wisdom shown by his subcommittee, made up of Sen. Jon Cisky and Sen. Don Koivisto," Harrison said. "Their bill, whether enacted or not, is a show of support for higher education."

Later that day, the chairs of the House and Senate appropriations committees-- Rep. Donald Gilmer, R-Kalamazoo, and Sen. Harry Gast, R-St. Joseph--met with Senate Majority Leader Richard Posthumus, R-Alto, and Speaker of the House Paul Hillegonds, R-Holland, to review newly revised estimates of state revenues and to set budget targets based upon those estimates.

The May estimates, produced by the fiscal agencies of the House and Senate together with the State Department of Management and Budget, projected fiscal year 1996 revenue at just under $12 billion, a decrease of more than $50 million from previous estimates in January. The projections include the impact of flattening auto sales and higher-than-anticipated income tax refunds.

Reflecting these projections, the budget leadership on May 16 established a target amount for higher education consistent with the governor's and the House's original recommendations--a 3 percent increase for the 12 universities including the U-M.

"What they are doing is telling the Legislature that these are the target numbers they hope to see in the budget," said James Kosteva, director of community relations and a member of the University's Lansing lobbying effort. "The final legislation passed by the two houses rarely varies much from those targets.

"But a number of senators are not pleased with the target figure for higher education. We can expect a good deal of debate in the Senate about which budget should be adopted," he said.

The Senate subcommittee's recommendations are scheduled to go before the Appropriations Committee later this week, and probably will advance to the full Senate the following week, immediately after the Memorial Day holiday.

The bill would then go to a conference committee to resolve any differences between the House and Senate versions. The Hood amendment--present in the House bill but not likely to appear in a Senate version--would be one of the items under discussion.

A final budget is expected to emerge from the Legislature and be presented to the governor in mid to late June.