State Higher Education Commissioner Joe Rallo says the budget recommendation released by Gov. Bobby Jindal’s administration last week is a starting point for bigger discussions as state legislators work to craft a final spending plan for the coming year.
In the meantime, uncertainty lingers over the state’s colleges and universities — from immediate questions over how many classes to schedule to long-ranging questions over the future of some campuses.
“The uncertainty is there, and it’s going to accelerate,” Rallo said, speaking to the Baton Rouge Press Club on Monday.
Jindal’s budget recommendation largely spares colleges and universities from what they feared would be catastrophic cuts in the coming year.
But the Jindal plan relies on the state scaling back refundable tax credits. About $376 million of the money saved through that proposal would go toward higher education, leaving a $211 million gap in higher education funding in the coming year.
“We hope, and we trust, and we believe those dollars will become available,” Rallo said.
If not: “(System leaders) will have some very hard decisions to make with their boards.”
Though some have stoked fears of possible campus closures, Rallo said the idea makes little sense in practice and wouldn’t reap immediate savings that the state needs.
“This notion that you can wave a wand and close and get some dollar value isn’t a reality,” Rallo said.
Instead, leaders have been looking at other options, including ways to further privatize schools or give them more autonomy.
Rallo said leaders are not talking about turning to massive tuition hikes to cover additional costs. Tuition is directly linked to the state-funded Taylor Opportunity Program for Students, or TOPS, and any hikes would ultimately impact that program, which Jindal has opposed. Under the GRAD Act, schools have been able to raise tuition 10 percent each year if they meet certain performance benchmarks.
Rallo said Jindal’s budget recommendation serves as a launch-pad heading into the legislative session.
Typically, the final budget deeply resembles the governor’s proposal.
This year is an election year for legislators, and it’s Jindal’s final year in office.
Jindal’s plan offers up several recommendations for filling the gap in funding: increased fees for students — dubbed “excellence fees,” increasing the price of advanced degrees that aren’t directly tied to the state’s TOPS, giving the schools more autonomy over risk management, and raising the state’s cigarette tax to provide a tax credit program for students and businesses that donate to colleges and universities.
Rallo said he’s not entirely on board with the tax credit plan Jindal’s administration outlined, which would require students to pay the fee up-front and then apply for the credit when they file taxes in the spring.
“That’s not the position we’re taking,” Rallo said.
He said the state’s higher education systems will oppose any plan to put additional out-of-pocket expenses on students.
The Division of Administration didn’t immediately respond to a request for comment on Rallo’s position.