Tomblin approves $7 million in higher education cuts

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Tomblin approves $7 million in higher education cuts
By Ryan Quinn, The Charleston Gazette

 Gov. Earl Ray Tomblin signed the 2015-16 state budget bill Monday evening, but not before cutting roughly $2.8 million more from higher education than legislators had approved.

That’s according to a review by Sean O’Leary, policy analyst for the nonprofit West Virginia Center on Budget and Policy, who said the Democratic governor made changes before approving the budget that will result in a more than $7 million cut to the state’s two-year and four-year college and university systems.

That’s down from the $12 million slash Tomblin proposed in January, but up from the $4.6 million the Republican-controlled Legislature instead suggested cutting when it passed the 2015-16 budget bill last week.

The cut is the third in three years for higher education — there was a 3 percent cut this fiscal year and a 9 percent cut in 2013-14 — but the leaders of the state Higher Education Policy Commission, which oversees four-year colleges, and the Community and Technical College System, which oversees two-year institutions, said the funding decreases to their systems are under 1 percent.

“The budget cuts aren’t huge,” said CTCS Chancellor Jim Skidmore.

“This is much less than what we’ve had to deal with in the past,” said HEPC Chancellor Paul Hill, who thanked the governor and Legislature for continuing to preserve $94 million in annual student-aid funding to programs like the Promise Scholarship.

Hill called the cuts — which he said reduce funding for the HEPC and CTCS and the schools that comprise them to about $518 million, down from about $526 million this fiscal year — a “fair response” to West Virginia’s overall budget situation.

The decrease comes as data from the HEPC shows tuition has increased about 30 percent for in-state students and 24 percent for out-of-state students in roughly the last five years. A recent report presented to the agency showed the state’s aging four-year colleges and universities need $50 million of annual spending on deferred maintenance to not fall further behind in needed repairs and other work — an investment level they didn’t meet in 2014.

Tomblin’s proposed budget suggested taking $15.5 million from the state’s more than $860 million “Rainy Day” fund and the Legislature’s bill took $22.7 million, but the governor dropped the amount down to $14.8 million before signing the budget into law.

“Due to a decline in projected revenues and a long-projected increase in the state match required for Medicaid expenses, this year’s budget was one of the most challenging to deal with,” Tomblin wrote in his budget message. “I believe my recommended budget was solid and fundamentally sound.”

He said he vetoed more than $11 million in spending from the budget to continue to maintain excellent bond ratings and “receive the best interest rate on debt transactions.”

Shayna S. Varner, press secretary for Tomblin, wrote in an email to the Gazette Tuesday that the Rainy Day fund would have to drop to about $645 million to drop below the Wall Street-recommended level that would endanger the state’s bond ratings.

Above the Legislature’s $4.6 million in higher education cuts, O’Leary said Tomblin cut an additional $1.9 million from the HEPC and an extra $866,000 from the CTCS.

Skidmore said the Legislature had actually approved about a $322,000 funding increase from this fiscal year, but Tomblin cut it to a $544,000 decrease. Skidmore said that, atop $477,000 in cuts for the two-year schools themselves, the decrease includes about $11,000 less for the CTCS’ central operating expenses, $51,000 less for workforce development grant programs and $4,000 less for a high school to college transition program.

Among four-year institutions in the HEPC, Tomblin sliced an additional $548,000 from the West Virginia University School of Health Sciences. He increased the cut for the West Virginia School of Osteopathic Medicine by $450,000, and upped the cut for the Marshall School of Medicine by $275,000.

Cuts for a handful of other four-year institutions were increased, O’Leary said, but by lesser amounts.

Rob Alsop — WVU’s vice president for legal, government and entrepreneurial engagement — noted that the governor originally proposed a $7.2 million cut to the entire WVU System, which includes the WVU Tech and the Potomac State College of WVU campuses in addition to Morgantown.

“We’re very grateful that the governor’s office and the Legislature were able to reduce some of those cuts,” Alsop said.

The Legislature restored $3.5 million to WVU in its bill, and the changes Tomblin made to the bill left most of that alone, Alsop said. Having seen the approved budget only a few hours ago, he said no decisions have been yet made in how the state’s largest university will absorb the cuts. He noted that, among Tomblin’s vetoes, the governor removed some language requiring WVU to spend state funds in certain areas, giving the university more flexibility.

The governor wrote that the cuts are “necessary to responsibly manage future year budgets, without raising taxes.”

O’Leary said the state’s elimination of its business franchise tax and food tax and the reduction of its corporate income tax were responsible for $425 million in reduced revenue this fiscal year — a loss that will continue in the future.

“We’re cutting the budget each year,” he said. “So we’re not seeing expenditure growth causing the problems, we’re seeing the lack of revenue growth causing the problems, and that can be traced back to the tax cuts.”

Sen. Mike Hall, R-Putnam and chairman of the Senate Finance Committee, said there’s no “practical” way to override the governor’s vetoes to the budget. He said the move would require calling the Legislature back into session and large majorities in both houses to overturn the governor’s changes.