Kirwan favors tuition increase over budget cuts for university system

General Assembly 2009

March 21, 2009|By Julie Bykowicz | Julie Bykowicz,julie.bykowicz@baltsun.com

The head of the University System of Maryland said yesterday that students might have to pay more for tuition - even though lawmakers are poised to endorse Gov. Martin O'Malley's pledge to hold prices steady for a fourth straight year by infusing the system with an extra $16 million.

The House of Delegates' budget committee kept money for the tuition freeze intact as it scoured the $14 billion state budget looking for cuts. But committee members recommended $21 million in other university system cuts, exceeding O'Malley's funding boost and prompting a sober warning from Chancellor William E. Kirwan.

"We're back to being worse off than when we originally proposed an increase in tuition," Kirwan said. "That's why tuition has to be back on the table."

The Board of Regents sets tuition rates for each of the 11 public university campuses and was planning a 4 percent increase. O'Malley, who could cite a tuition freeze as a fulfilled campaign promise during next year's election season, set aside money in his January proposal to avoid the increase.

"No one is complaining. We understand the state is in deep difficulty," Kirwan said. However, he said, it does not make sense for lawmakers to "erode the quality" of the universities by depriving them of extra revenue that would come from raising tuition.

But some lawmakers see it differently, arguing that the system, with an annual budget of more than $1 billion, should be able to absorb the cuts without making students suffer. Lawmakers recommended yesterday slicing nearly $11 million from the system's general budget, according to university officials, and $10 million more from its reserve funds.

"I would hope and doubt that the impact would result in a tuition hike for students," said Del. John L. Bohanan Jr., a St. Mary's County Democrat and chairman of the House budget subcommittee on education. "In the end, higher education is going to fare extremely well."

The cuts to universities were among more than $500 million in spending slashes and funding transfers the House Appropriations Committee approved late yesterday.

The panel decided to take back more than $30 million in primary education aid that was overpaid to localities because of a miscalculation by the state. Delegates earlier had approved a $204 million decrease over two years in the share of highway user revenue distributed to counties and Baltimore for road projects.

But they rejected a 1 percent across-the-board pay cut to state employees that would have saved nearly $68 million, and a suggestion to shift to localities the $120 million cost of so-called disparity grants intended to help less wealthy jurisdictions such as Baltimore.

Yesterday's decisions must be approved by the full 141-member House, and the Senate will take up the budget next week.

Senate President Thomas V. Mike Miller has said he thinks O'Malley, a fellow Democrat, has "gone overboard" with the tuition freeze.

But the chamber appears unlikely to reject it. Sen. Edward J. Kasemeyer, a Baltimore County Democrat who heads an education subcommittee, said senators are committed to the freeze but that some cuts to the system might be necessary.

"We haven't made quite as deep of cuts [to the system] as the House has, but it may come to that," he said.

Kirwan and university system lobbyist Patrick J. Hogan, a former senator who served on the budget committee, said approving the $16 million for the freeze is meaningless if the system is sapped of other money. "A cut is a cut," Hogan said. "It's all green."

Kirwan said people "seem to think there's a magic pot of money all by itself that controls whether or not we need a tuition increase. There's not."

University system officials are worried that their bond rating might suffer from cuts to its $104 million reserve fund. Higher bond ratings lead to lower interest rates when universities borrow money for construction of residence halls, student unions and other projects.

Hogan noted that the fund already took a $20 million hit this year. "It's not something you can just keep cutting and cutting," he said.

A spokesman for O'Malley said "the debate continues" about the level of cuts the university system will have to bear.

"The governor has spoken to the leadership and expressed that maintaining the tuition freeze is a top priority for the administration," Rick Abbruzzese said. "But he also understands the challenges we face with balancing [the] budget in [the] face of a national recession."

Baltimore Sun reporter Laura Smitherman contributed to this article.

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