Monday, June 22, 2009

Stimulus Money Helps Colleges Avoid Slashing Budgets Now, but Big Cuts May Loom


This year was bleak for state higher-education budgets. But college leaders are even more worried about what comes next.

The billions of dollars in federal stimulus aid to plug shortfalls in state education budgets have helped limit the damage this year, but the money hasn't prevented all of the cuts to college budgets. Most states are spending the bulk of the stimulus money they are receiving for education on elementary and secondary schools, and roughly 20 percent on public colleges. In one state, Wisconsin, none of that federal aid is going to higher education.

And the situation could get worse. Many states are spending all of their education stimulus money to fill gaps in the current and next budget years, leaving nothing for 2011, when many of their economies are still expected to be suffering from the recession.

As lawmakers and campus leaders contend with the budget crises, some higher-education experts believe the severe scope of this recession will force fundamental changes in how public colleges operate as they struggle to maintain both quality and affordability in an environment of increased competition for tax dollars and students.

"The different sectors within higher education will be reshaped, and changes in instructional delivery and program offerings will be dramatically altered by fiscal realities, market forces, and technological enhancements," said Daniel J. Hurley, director of state relations and policy analysis at the American Association of State Colleges and Universities.

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