Gov. Mike Dunleavy has proposed a $155 million reduction to the University of Alaska budget for the next fiscal year, which amounts to a 41 percent cut.
At a press conference on Wednesday, Dunleavy said his reductions to former Gov. Bill Walker’s proposed budget focused on the state’s “$1.6 billion deficit.”
“This budget is going to impact all Alaskans,” Dunleavy said. “It’s too massive not to. It’s going to touch all Alaskans no matter where they live and no matter what they do. It’s going to be a different way of budgeting that all Alaska is going to have to pull together to make sure we get through this process.”
At the conference, the Director of the Office of Management and Budget, Donna Arduin, said that the budget cuts targeted programs with “unsustainable spending that have come without corresponding positive results.”
“Our investment in the University of Alaska is much higher than other states and is eroded by low retention and graduation rates,” Arduin said.
The proposed cuts to the university are substantial; UAA alone runs off of $120 million unrestricted general funds. To fill the deficit caused by the cuts, UA would likely have to close campuses, raise tuition and lay off employees. At a press conference immediately following Dunleavy’s budget announcement, UA President Jim Johnsen discussed how the budget would impact the university.
“I’m confident we’ll need to close campuses if this budget makes it all the way through the legislative process,” Johnsen said.
To put it into perspective, closing all of the UA’s community campuses from Ketchikan to Kotzebue would only save $38 million, doubling tuition would only raise $140 million and eliminating a statewide office would save just $18 million.
In the last five years, the university has faced yearly budget reductions. These reductions have been $3 million to $61 million less every fiscal year budget since fiscal year 2014. At the same time, course enrollment at all UA campuses has declined by almost 15 percent from the fall of 2013 to fall of 2017. Decreases in funding and declines in enrollment have already prompted incremental tuition increases each year and the latest tuition increase raised the price of a lower division credit from $202 to $212 this year.
“If we doubled our tuition, we would just cover this cut,” Johnsen said.
Johnsen also said that continued cuts and uncertainty about the university’s future have negatively impacted enrollment.
“Unlike the DMV where you have to go get your driver’s license, people don’t have to come to the university,” Johnsen said.
The governor’s new proposed budget is not the final say on what the university shall receive. The state legislature will be able to revise the budget before Dunleavy signs or uses his line-item veto on the final budget.
Chancellor Cathy Sandeen has held several open forums on the topic, and she says this is just the first step in the budget process.
“We are optimistic that the value of the university to the state will be recognized as we go through this process,” Sandeen said.
In an email to UAA students, Sandeen explained that UAA typically receives more than a third of its funding for the state allocation to the University of Alaska and that the overall cut in funding to UAA would be $49 million.
“UAA’s total budget comes from several sources, including state funding (approximately 39 percent), tuition and fees (26 percent) and other university receipts (35 percent),” Sandeen wrote in the email.
The governor’s capital budget, a document that details funds specifically for maintenance and repair work, also allocates the university $5 million for repairs and renovations. The university states that it needs over $50 million for facilities deferred maintenance and renewal projects.
The final budget will go into effect July 1, the start of the fiscal year 2020. Between now and then, the university will advocate for increases while also deciding how to accommodate cuts of this magnitude.
The first step in that process will be in the form of discussions at the Board of Regents meeting in Anchorage from Feb. 28 to March 1.