College cuts a problem

If higher education remains the key to economic development progress in Louisiana, the problems of a tough budget year and a highly political system of decision-making are likely to inhibit real progress in 2009.

The budget problems are well-known, with state government struggling with declines in tax revenue. Officials at colleges, as other state agencies, are trying to craft budgets for the 2010 fiscal year that begins July 1.

On the one hand, talk of a $2 billion shortfall is highly alarming. At the same time, some of the alarm is mitigated by the belief that worst-case scenarios won’t actually occur. For example, significant shortfalls are projected in the Medicaid program for the poor, but the Obama administration is pushing subsidies for states in that area.

While Gov. Bobby Jindal cannot count on being rescued entirely by President Barack Obama, it’s likely the federal “stimulus” will help the state out significantly.

Jindal also ordered midyear budget cuts for this fiscal year to start trimming; he made it clear that agencies should look at cuts that could be sustained in the fiscal 2010 budget.

Midyear budget cuts for universities amounted to $55 million. Jindal said that colleges still got more general fund money than in the year before, but the increase was slight. As every tuition-paying parent knows, inflation in higher education costs is higher than in the overall economy.

Leaders of the various college systems have had to compromise over a new funding formula that Commissioner of Higher Education Sally Clausen said will reward campuses for outcomes _ such as higher graduation rates, or more graduate student enrollments _ rather than just getting more freshmen in the front door. Thirty years of experience with the formula suggests its impact is gradual. Like steering a bulky battleship, universities round a turn only in slow-motion.

Further, the willingness of college leaders and their political masters to take really hard steps toward reform is limited.

Even in the wake of Hurricane Katrina’s devastation, the state’s leadership could not find the political will to close Southern University in New Orleans, one of the worst-performing campuses in America in terms of graduation rates and other indicators.

If campuses are sacred cows that cannot be touched, and must be fed, the impact of even a drastically improved formula will be tentative, at least for a while.

Looking beyond what we hope will be a limited time of recession, Louisiana’s prospects for economic development boosted by higher education remain cloudy.

There are some good ideas out there. Barry Erwin, president of the Council for a Better Louisiana, said the state should emulate Georgia and establish a research alliance that would generate more economic growth from research in Louisiana universities.

Knowledge-based jobs, though, are hotly sought after by other, wealthier states. Significant resources would have to be committed to any such endeavor in Louisiana; overcoming the parochialism of state colleges would be a struggle behind the scenes, if not in public squabbles.

As with so many good notions, the difficulty of “moving the needle” on long-standing problems will be exacerbated by the current decline projected in state revenue. “I hate to be pessimistic,” said Jim Brandt, president of the Public Affairs Research Council, “but the opportunity for change is not when you’re headed in down-budget mode.”

– The Advocate, Baton Rouge, La.