2020 IOWA LEGISLATIVE PREVIEW

State funding of Iowa's regent campuses holds key to tuition rates

Even with rate hikes, universities nationwide face enrollment cliff

Steam rises Feb. 8, 2019, from the University of Iowa Power Plant in Iowa City. In a deal being looked at by Iowa's two
Steam rises Feb. 8, 2019, from the University of Iowa Power Plant in Iowa City. In a deal being looked at by Iowa’s two other public universities, the UI made a 50-year deal to partner with a private manager of the operation, creating an endowment that will help fund UI strategic initiatives. (Liz Martin/The Gazette)
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It’s the $18 million question lawmakers face over Iowa’s three public universities when the Iowa Legislature convenes starting Monday.

Iowa’s Board of Regents — which governs the public universities — has asked for the increase that would, if approved, bring its state support for the 2021 budget year to $642.4 million.

Most of that goes into the general education budgets at the University of Iowa, Iowa State University and the University of Northern Iowa.

The universities have been calling for more legislative support after state budget shortfalls led to funding cuts that were never fully restored even after the financial times improved.

“State appropriations are one of two primary sources of core operating funds supporting higher education,” the regents wrote in their request.

Tuition is the other. And the board in November 2018 unveiled a five-year plan promising annual increases for UI and ISU students — but tying the severity of those hikes to state support.

If lawmakers this session approve the full $18 million requested increase for next year, the UI and ISU each would get $7 million more and UNI would get $4 million more — allowing the UI and ISU to hold tuition increases to 3 percent for Iowa undergraduates and UNI, potentially, to keep its base rate frozen.

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Regents have repeatedly stressed that higher education funding from the state remains significantly less than in the 2009 budget year.

The campuses have placed more emphasis on state support — and on improving internal efficiencies and finding creative revenue sources — as the tuition revenue, even with the increases, remains in question.

Higher education experts warn of a looming enrollment cliff thanks to a drop in birthrates shrinking the pool of collegiate prospects. Brent Gage, UI associate vice president for enrollment management, has said the Midwest will be especially hard-hit, with forecasts projecting a 19 percent drop in students attending national four-year institutions from 2012 to 2029.

“If we do nothing at the University of Iowa, if we do exactly what we’re doing right now, what should we expect between 2012 and 2029?” Gage asked during a July presentation. “We should expect that we would be 15 percent smaller.”

Regents in October convened a retreat to discuss, among other things, the dire enrollment projections. One suggested step involved broad cooperation with private and community colleges in support of a mission to strengthen the economy and keep rural Iowa afloat.

Sen. Joe Bolkcom, D-Iowa City, said Friday he’d like to see Gov. Kim Reynolds take the lead on that discussion.

“Gov. Reynolds should convene a higher education summit with the entire enterprise of higher education and begin to have a conversation about how we can work together to address this challenge,” Bolkcom said. “Because there’s a high likelihood of some of our private colleges not being about to survive this change that’s going to happen.”

The regents and their public universities can help facilitate a discussion, Bolkcom said, but in the end they have their own interests to protect — in that they, too, have to sustain enrollment by competing for students in Iowa and surrounding states.

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“It’s not the regents’ job to address the problems at the community and private colleges,” Bolkcom said.

As for the regents’ funding request this session, Bolkcom said he supports a robust provision but suspects the Legislature’s response will be similar to last year, when lawmakers appropriated a $12 million increase — $6 million shy of the request.

Although former Gov. Terry Branstad typically heard the regents’ legislative requests during a collective meeting in December, this year his successor — Reynolds — swapped that with private meetings.

ISU President Wendy Wintersteen and ISU State Relations Officer Carolann Jensen met with Reynolds in December to go over ISU’s 2020 legislative priorities, according to ISU spokeswoman Angie Hunt.

Additionally, she said, ISU and the UI are seeking full funding of a joint biosciences innovation program that got $1.1 million of a requested $4 million total last year.

“ISU would use $3 million of those economic development state dollars to lead the work on three of the four bioscience platforms — biobased products, precision and digital agriculture, and vaccines and immunotherapeutics — while Iowa spearheads work on medical devices,” Hunt said.

The Ames campus also is requesting a $30 million commitment — or $10 million annually over three years — for a College of Human Sciences building plan.

When asked about its meetings with the governor and its priorities for the new session, UI government relations stated that “President (Bruce) Harreld and UI leadership regularly meet with the university’s local legislative delegation, the governor, and other legislators” on requests.

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The UI recently engaged in a novel public-private partnership for the operation of its utility system that officials hope will provide a new annual revenue stream.

A private partner is paying the university an upfront sum of $1.165 billion in exchange for the promise of 50 years of stable revenue as its utilities operator.

Much of that sum will go to an endowment, from which the UI plans to pull annually to support its strategic plan.

When asked whether the other regent universities are considering similar arrangements, ISU spokeswoman Hunt said her campus “continues to evaluate options, including public-private partnerships, as part of ongoing efforts to achieve greater efficiency and effectiveness of campus operations.”

UNI spokeswoman Cassie Mathes said her campus is “studying the arrangement.”

When asked whether UNI or President Mark Nook have met with Reynolds on legislative priorities — or whether they plan to — Mathes said, “no.”

Iowa’s community colleges work together to advocate for their entire system through the Iowa Association of Community College Trustees and the Iowa Association of Community College Presidents, said Justin Hoehn, a spokesman for Kirkwood Community College. In December, Hoehn said, those representatives discussed the “need for an $8.8 million increase in state general aid” in the face of higher costs and flat or declining enrollment.

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

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