Iowa universities seek $34 million state funding hike, cite inflation

Marking its highest requested state funding increase in nearly a decade, Iowa’s Board of Regents is seeking $34.7 million more in education appropriations from the Legislature for the next budget year — due, in part, to soaring inflation.

“These rates of inflation are close to the highest rates experienced in the United States during the late 1970s and early 1980s,” according to the board’s proposed appropriations request for fiscal 2024, which regents will consider next week.

“There is great concern about employee costs in a market heavily influenced by inflation, competition for quality talent and labor shortages.”

The board’s proposed appropriations ask includes a $32 million bump in general education funding for its three public universities — plus another $2.7 million for its special schools and special purpose units, such as the University of Northern Iowa’s new community college collaboration.

If lawmakers grant the board’s request, they would up the regents’ total education appropriations from $575.9 million this year to $610.5 million next, according to board documents made public Tuesday.

The board’s total requested increase amounts to its highest in nine years, and regent staff justified the current request by citing a 9 percent increase in the Consumer Price Index from June 2021 to June 2022.

The annualized rate of change in June 2022, according to the board request, was 17 percent.

“The costs of nearly all services provided and goods purchased by the regent universities are rising,” according to the board. “Examples include information technology hardware and software, food, utilities, fuel, collective bargained wages and personnel costs.”

How has the legislature responded to past funding proposals?

If approved, the increase would come after years of cut, level or less-than-requested funding for the regents — who collectively govern the University of Iowa, Iowa State University and UNI.

Where the board last year asked the Legislature for $22.1 million more for the now-current budget year, lawmakers in May finalized a budget upping regent funding by $6.2 million for the fiscal year that started July 1 — $5.5 million of which was designated for general university appropriations.

That translated to a 1.1 percent increases for each of the three universities:

The year before, lawmakers denied the board any general education funding increase — rejecting in full its request for $26 million more. That year’s ask came after the state in 2020 cut regent appropriations by $8 million in response to the pandemic.

Looking back more than 40 years, during which tuition in 1981 accounted for 21 percent of the universities’ general education funding and appropriations accounted for 77 percent, the near reverse is true today. For the current budget year, appropriations account for 31 percent of general education funding and tuition accounts for 64 percent.

The board again increased tuition rates this fall by 4.25 percent for most students across its campuses.

The board’s strategic plan, according to its request, "calls for adequate support of regent institutions from all sources.”

Vanessa Miller covers higher education for The Gazette.

Comments: (319) 339-3158; vanessa.miller@thegazette.com