Higher ed finances 'bleak' in Oklahoma after $74M in cuts

Many of the state's public schools lack enough cash reserves to protect them in case of emergencies

The Oklahoma State Regents for Higher Education on Thursday approved $26 million in budget cuts, which combined with previous reductions means that the state's higher education system is now operating with $74 million less than last fiscal year. 

The state is expected to fall $800 million to $1 billion short of needed funds in FY 2016-2017. Currently, higher education accounts for 14.4% of state appropriations. That funding makes up 35% of Oklahoma's higher education budget.

Oklahoma's colleges brace for a major budget shortfall

The state system's public tuition has increased just 5.2% in the past six years, and according to the Department of Education it is the third most affordable system in the nation.

Typically, a tax on oil gross production revenue generates $94.7 million annually for the higher education system, but this year's estimate is $26.3 million less, according to Amanda Paliotta, vice chancellor for budget and finance.

"We spread it out among all our institutions, all of our programs and our agency, so everybody took their fair share of this reduction," Paliotta says. 

Drastic measures

Higher education leaders in Oklahoma are preparing for the budget shortfall by consolidating back-end functions and cutting programs. In anticipation of the funding cut, some of the state's 25 colleges and universities are developing plans to reduce costs, such as creating joint degree programs, and centralizing payroll, human resources, and accounting across multiple campuses.

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Paliotta says the most cuts are being made to personnel. Colleges and universities are offering early retirement incentives, but doing so leaves vacancies unfilled and forces institutions to cut faculty and staff.

"We're struggling to keep the quality of the student experience," says Northern Oklahoma College President Cheryl Evans. "It's a bleak outlook."

Chancellor Glen Johnson outlined some steps the state's colleges and universities are taking to save money:

  • Cameron University has eliminated 32 positions;
  • Redlands Community College is eliminating its equine and volleyball teams; and
  • Seminole State College is eliminating some scholarships.

Northeastern Oklahoma A&M College President Jeff Hale says the school has reduced its operating expenses for FY 2015-2016 by $1 million and shuttered all discretionary spending. Hale says he is also considering a 10% tuition increase and selling assets for extra cash.

State colleges and universities must have enough cash reserves to cover a month's worth of expenses in case of emergencies. However, Paliotta says 16 schools will not meet that goal this fiscal year, and more schools are not far behind (McNutt, The Oklahoman, 3/6; McNutt, The Oklahoman, 3/3). 

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