Deal To Keep MnSCU Open During Possible Shutdown

ST. PAUL, Minn. (AP) -- Tens of thousands of students attending institutions in the Minnesota State Colleges and Universities system would pay more in tuition this fall under a proposed budget discussed Wednesday, but at least officials are now confident the classroom doors will be open this fall even if other parts of the government shut down.

Officials said the system had enough reserves and tuition revenue to operate through the fall term, but that money was controlled by the state finance department. If that office closed in a government shutdown July 1, there was a good chance the MnSCU colleges and universities would close as well.

Scott Thiss, chairman of the board of trustees, announced Wednesday during the budget meeting that the system had reached an agreement in which it would pay the finance department to keep handling payroll and other financial functions during a shutdown.

"We're grateful our colleges and universities will be able to operate without interruption," Thiss said.

Gov. Mark Dayton petitioned a Ramsey County court on Wednesday, laying out services he said must be maintained even if the government closes July 1. According to the petition, "Operations of the Minnesota State Colleges and Universities will continue based on its statutory and practical financial autonomy" under Dayton's plan.

The court will make the final decision on which state functions are too important to stop during a shutdown, but MnSCU was confident enough to announce it expects to rescind the 6,000 layoff notices sent to its employees last week.

The Democratic governor and Republican-controlled Legislature have been unable to solve a $5 billion budget deficit or agree on a bill to fund higher education. As a result, the shutdown looms and both MnSCU and the University of Minnesota are moving ahead with budgets that can only assume state funding will come.

The MnSCU trustees considered a proposed budget for the next fiscal year that includes a $65 million cut in state funding from the $605.5 million it received last year. That's the amount of state aid contained in the bill the Legislature passed and Dayton later vetoed. Dayton wants more money for higher education.

To make up for the loss of state money -- and $26 million in federal stimulus money -- the proposed MnSCU budget includes an increase of $28.7 million in tuition and $67 million in expense cuts.

"This has been painful," Thiss said. "We've had to make some tough budget decisions."

The system's 25 two-year colleges are proposing an average tuition increase of 3.7 percent, or $166, to $4,644. At the system's seven four-year universities, tuition would go up an average of $4.8 percent, or $299, to $6,497.

The 3.7 percent tuition increase at the colleges exceeds a 3 percent cap in the bill vetoed by Dayton.

Travis Johnson, president of the Minnesota State College Student Association, asked the board to hold the tuition increase to 3 percent, saying a larger increase would have a "long-term negative impact on students in this state."

Chancellor James McCormick said he understood the students' concerns, but they weren't workable at a time when tuition money was needed to backfill another decline in state support.

"I said 4 (percent) because it is several million dollars we desperately need," McCormick said.

However, if Dayton and the Legislature agree on a higher education funding bill that includes a 3-percent lid on tuition, MnSCU Chief Financial Officer Laura King said some colleges would have to adjust.

"That's the kind of ambiguity we are living in," she said.

The system's colleges and universities are also facing another round of cost-cutting, including layoffs, closing programs, reducing service hours and delaying repair projects.

The proposed budget shows the system has eliminated 680 jobs in the past few years and given early retirement packages to 177 employees. It has also eliminated about 80 academic programs.

Don Larsson, president of the faculty union, said between 250 and 300 faculty jobs will have been eliminated between the cost cutting that started two years ago and the end of 2012.

"It has not been an easy process at all," he said. "We're still losing faculty positions."

Altogether, the proposed budget includes $197 billion in spending, down $76.8 million from fiscal 2011. If approved, the tuition increases would begin this fall at most of the colleges and universities in the system and earlier in a few. A final vote on the budget is scheduled for June 22.

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