EL DORADO — The Higher Education Coordinating Board approved recommendations Friday for a $137 million increase in annual state funding to Arkansas’ public colleges and universities in fiscal 2014.
It also approved a request for $213 million in one-time funding for capital projects, which would be paid through a state budget surplus.
Higher-education leaders acknowledged that the Legislature likely will not fulfill the request to increase their annual state funding. The recommended increase would provide all institutions with at least 75 percent of the public funding they are entitled to under a formula included in state law.
“To be honest, we don’t expect the money to be there for what we are recommending now,” Arkansas Department of Higher Education interim Director Shane Broadway told the board in a meeting at South Arkansas Community College.
After a small cost-of-living adjustment, the universities will first distribute any new state funding to those institutions that are funded below 75 percent, he said.
State higher-education funding has seen only slight increases in recent years, and an expected shortfall in state Medicaid funds will be a top priority in the 2013 legislative session, which starts in January, Broadway said.
Growing enrollment combined with relatively stagnant funding levels mean some institutions are falling further behind in their funding needs, board members said.
Six universities and 14 community colleges would be funded at less than 75 per- cent of their need without a funding increase, according to the recommendation, with some receiving about half of the state funding they are entitled to under the formula.
It would take a $270.3 million increase from current levels to fund all campuses at 100 percent of their need under the state formula, the Higher Education Department said.
Last year, the coordinating board began requesting higher funding levels as a statement to lawmakers that many colleges and universities have had little choice but to raise tuition to cover costs.
“These costs have to be paid somehow,” Broadway said. “A lot of times, that ends up on the backs of our students and parents.”
For the current fiscal year, Arkansas lawmakers approved a total general-revenue budget of about $730 million for higher-education institutions.
That budget included a $3.63 million increase to be distributed among the colleges and universities that have the lowest percentage of their state appropriation needs covered.
The recommendation approved Friday would increase funding by $77 million for the state’s public two- and fouryear institutions, and by $58 million for institutions not covered by the formula, such as the University of Arkansas Agriculture Division. The University of Arkansas for Medical Sciences would receive $41 million of that money.
Lawmakers are expected to focus much of their attention in the coming legislative session on fixing a Medicaid funding shortfall that is projected to reach $390 million by July 2013.
Gov. Mike Beebe’s office said Friday that it cannot yet anticipate which agencies may see funding increases in the next fiscal year.
“You traditionally see that these budget requests are wish lists,” spokesman Matt DeCample said. “We’re starting to get requests from a number of agencies, and I think they realize going into it that they are not going to get their full wish lists.”
Higher-education board members were more hopeful about the possibility of receiving some one-time funds for capital projects.
Those projects have traditionally been funded through year-end revenue surpluses, and they are on the table as a possible use for an excess $145 million that remained at the close of fiscal 2012 on June 30, DeCample said.
The surplus, combined with money not already obligated from the fiscal 2011 surplus, will give the Legislature $191 million in one-time money in next year’s legislative session, the state Department of Finance and Administration has said.
“We’ll have to see what other needs the state has to address,” DeCample said Friday.
The $213 million in capital projects the board approved includes requests to fund equipment, library materials, deferred maintenance and $135.6 million for new construction and upgrades.
The list includes projects such as an $8 million refurbishment of Kimpel Hall at the University of Arkansas at Fayetteville, $5 million in renovations at Henderson State University in Arkadelphia and $3.3 million to renovate Old Main at University of Central Arkansas in Conway.
Arkansas, Pages 9 on 07/28/2012