At $3.2 billion over two years, higher education is the third-largest general fund expenditure in the governor's budget proposal. His recommendation includes tuition assistance for high schoolers, help for veterans and money for bonuses based on performance.
Pawlenty's proposal aims to point state college and university funding in a new direction.
"It is not a game-changing amount of money," Pawlenty acknowledged. "We think it's a measured and responsible way to try to get people focused on the debate, get them to focus on the measurement and begin to constructively change the culture."
That culture change is one based more on accountability and rewarding successful students. Pawlenty has shifted last year's proposal to offer two years free tuition to the top 25 percent of high school graduates.
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By not funding the system, we're looking at another very significant increase in tuition.
Now he wants to put more than $90 million toward scholarships for students to take college credit courses during their last year in high school. The idea is similar to a proposal by a collection of the state's private colleges.
As typically happens, both state-supported institutions received less than they asked for. MnSCU's Linda Kohl calls the governor's proposal a promising beginning.
"This is the largest budget increase for the system ever recommended by a governor. And we're also pleased that the governor's recommendation has, for the most part, followed the priorities set by our board of trustees," Kohl said.
The governor's plan includes $60 million for technology upgrades for MnSCU, about $10 million less than requested. The budget also gives $12 million to recruit and keep underserved students, about half what MnSCU hoped for. But he did not grant some $55 million that MnSCU officials say covers a 3.25 percent increase in basic costs.
"Fuel costs have been going up more than that. Health insurance is expected to increase at least 10 percent or more. So we're looking to get some help covering those inflationary costs," Kohl said.
In making his presentation, Pawlenty never mentioned tuition, which has seen smaller relative increases the past two years, but ballooned 75 percent at the University of Minnesota between 1995 and 2003.
U of M Chief Financial Officer Richard Pfutzenreuter says the governor's proposal would make it hard for the university to keep tuition increases below the 4.5 percent target for the coming school year.
"The governor neglected to deal with about half of our request," he said. "We're disappointed about that and very concerned about the potential impact that could have on tuition for our students."
Pawlenty provided $38 million in one-time money for a partnership between the U of M and the Mayo Clinic, but he did not acknowledge the U's effort to form a long-term $313 million bioscience research endeavor.
"We were quite surprised to see that he provided no recommendation on that, or our very modest $22 million request to keep our facilities in repair," Pfutzenreuter said.
The governor's budget plan also did not address MnSCU's $34 million in construction projects.
The implied tuition increase is bad news for students such as Scott Formo, president of the Minnesota State College Student Association representing students in the state's two-year college system.
The association had hoped to push for $73 million beyond the initial MnSCU request to keep the tuition increase flat. He says the governor's proposal dims that possibility.
"By not funding the system, we're looking at another very significant increase in tuition, which is something we wanted to try to avoid if at all possible," Formo said.
Pawlenty tried to head off concerns by those believing his budget doesn't do enough to fund their proposals. He says most Minnesotans would agree that spending increases well above the Consumer Price Index are fair. He says the higher education budget plan balances what the institutions are used to with changes for the future.
"We hope it's enough to get their attention without disrupting their traditions or heritage too much, but enough to get them to start looking at things in a different way," Pawlenty said.
Officials with the colleges and universities hope the Legislature will look at their proposals in a different way, appealing to legislative leaders to bring the dollar amounts closer to their original requests by the end of the session.