News From Terre Haute, Indiana

Indiana Legislature

June 6, 2011

No caps might limit funds

Influential budgetmaking legislators unhappy ISU, other state schools exceeded recommended tuition increases

INDIANAPOLIS — The incoming head of the State Budget Committee has an idea for Indiana State University and other public universities that raised their tuition rates after he warned them not to: He might just block their access to $200 million worth of unspent capital project funding.

State Rep. Jeff Espich, who in July takes over the five-member committee that oversees state spending, said “it's not acceptable” that six of the seven state schools decided last month to raise tuition higher than the maximum caps recommended by the Indiana Commission for Higher Education.

Espich, who wants to make the ICHE’s caps mandatory, also said he doesn’t buy the universities’ explanations that their costs have escalated while the rest of the economy has slowed.

“They’ve always got an excuse,” said Espich.

He noted that tuition rates at the state’s colleges and universities have risen nearly 100 percent over the last decade.

“That’s insensitive to the problems and issues that Hoosier families face,” Espich said.

Espich, who serves as chief budgetmaker in the House,  isn’t alone in his irritation.

His counterpart, Senate Appropriations Chairman Luke Kenley, said it was time legislators “got the attention” of university administrators who’ve raised tuition at a much faster pace than Hoosier incomes have risen.

Both Espich and Kenley said university administrators will have to come before the State Budget Committee later this summer to justify why they decided to exceed those caps.

“I want to hear to their explanations,” Kenley said. 

All the state-supported colleges and universities have moved to raise their rates. Only Ivy Tech Community College proposed an increase, of 3 percent, that didn't exceed its recommended cap.

Two years ago, it was Kenley who held up millions of dollars earmarked for some of the universities’ capital projects until they agreed to lower their tuition hikes. 

In the 2012-13 state budget, there is no money that’s been allocated for university building projects, but Espich said there is $200 million that was earmarked in the past that remains unspent.

Espich said the State Budget Committee could decide to block that  money.

The ICHE’s recommended caps, which ranged up to 3.5 percent, aren’t mandatory, but Kenley said the legislature may decide to make them so, and that lawmakers needed to exert more pressure on the state schools to rein in their costs.

When asked what options the State Budget Committee and the legislature had to do that, Kenley responded: “No option is inconceivable.” 

The state universities contend it’s the legislature that is at fault for failing to give them adequate funding through the years.

In press releases and public statements, they’ve argued that tuition and fee hikes are needed because of state budget cuts and reductions in funding for building improvements.

They’ve also argued that they’ve taken measures to control their costs and increased student aid for families struggling to pay for college.

But ICHE Commissioner Theresa Lubbers said caps were needed to keep college affordable for Indiana students who need a post-secondary degree to compete for well-paying jobs.

She noted Indiana now ranks 13th in the nation for student loan debt, averaging $25,200 per student, and that none of the state schools have a four-year graduation rate of better than 52 percent.

She also said Indiana ranks 41st in the nation for the percent of adults with some kind of college credential.

“Meeting Indiana’s college completion and workforce demands depends on our ability to preserve access to affordable, quality higher education,” Lubbers said.

Espich put forth a proposal during the legislative session that ended in April that would have allowed the ICHE and the governor to cap tuition at the state-supported colleges and universities. That measure failed. “This shows that there’s pretty good evidence we were correct,” Espich said.

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