Gov. Scott Walker’s proposed 13 percent, $300 million budget cut for the University of Wisconsin System would lead to layoffs across the UW-Madison campus, chancellor Rebecca Blank said Tuesday, even though she and others see a long-term benefit in another part of the plan to give the university greater autonomy.
The proposed spending cut is believed to be the most severe in the System’s nearly 45-year history. It would be accompanied by another two-year tuition freeze and come in exchange for System control over its finances, including major building projects.
Walker on Tuesday touted the plan as a cost-saver while campus leaders and legislators described the cuts as too severe, noting the cuts would take effect in July, long before any long-term savings could materialize from more autonomy in purchasing, building and setting employee salaries.
Blank said it would likely cost her campus $120 million in the next two years on top of another two-year tuition freeze for Wisconsin undergraduates, a drop so dramatic and immediate that people would lose jobs.
“My expectation is there will be layoffs at every school and college,” she said in an interview. Other measures — freezing open positions, lobbying for a tuition increase for out-of-state students and some in professional schools — will be tried, she said, but she doesn’t expect them to offset the cuts enough to prevent layoffs.
Walker is proposing turning the 13 four-year campuses and 13 two-year colleges that make up the UW System into a public authority, a structure that would give the university more flexibility over a wide array of matters that are currently mandated by state law.
On his Twitter account, he wrote that the increased autonomy and funding cuts would have a similar impact as the controversial 2011 state law known as Act 10, which curtailed public employees’ collective bargaining rights amid other concessions while giving school boards and municipal bodies a freer hand in negotiating pay and benefits with their workers.
“Saves taxpayers (money) yet gives UW cost saving measures they’ve been requesting for years,” he wrote in explaining how the plan’s effects would mirror Act 10’s.
Joe Gow, chancellor at UW-La Crosse and the longest tenured among campus leaders in the state, echoed Blank’s concerns.
“To freeze tuition and then cut us that deeply is going to create serious challenges,” he said in an interview. “We welcome the autonomy, but in the coming two years we are going to be significantly short on resources.”
UW System president Ray Cross said that he sees a brighter future past the next two-year budget cycle.
“If we can get through these short-term challenges and deal with the issues they create, in the long term the ability to manage our resources more effectively and be able to operate our finances more like a business is a wise thing to do,” he said. “I’m pleased with that piece of it.”
Walker announced the plan Tuesday after releasing some details to The Associated Press on Monday. The State Journal first reported that the governor was considering proposing more autonomy for UW, possibly in exchange for budget cuts.
Walker will introduce his 2015-17 spending plan on Tuesday. The UW cuts were the first glimpses he’s provided of the coming budget, with cuts to other state agencies expected as well.
The cuts proposed by Walker would be the sixth time in the previous seven budget cycles that the Legislature has significantly cut UW funding, according to the nonpartisan Legislative Fiscal Bureau. Three of those budget cuts — in 2003-2005, 2005-2007 and 2011-2013 — were offset somewhat by tuition increases approved by the UW System Board of Regents. This would be the second consecutive two-year budget in which the System had its state funding cut and its ability to raise tuition denied by the Legislature.
The state provided $1.18 billion to the System in 2014-15, or 19.3 percent of the total budget.
At the Legislature, the plan met with early skepticism, including from top Republicans.
Assembly Speaker Robin Vos, R-Rochester, pledged to keep an “open mind” but he questioned how university officials could find enough savings to counterbalance a funding drop of such magnitude.
“It appears that a significant amount of flexibility would be necessary in order to manage such a large decrease off the base budget,” Vos said in a statement. “This is a decision that’s not to be taken lightly. Legislators will need to determine the best way to give greater freedom to the UW System knowing the state will continue to give the system hundreds of millions of dollars in taxpayer support.”
A spokeswoman for Senate Majority Leader Scott Fitzgerald, R-Juneau, said he had no immediate comment but that he planned to meet with fellow Senate Republicans on Tuesday to discuss the proposal.
Sen. Sheila Harsdorf, R-River Falls, chairwoman of the Senate Committee on Universities and Technical Colleges, acknowledged such a large cut would be “very challenging” for the campuses to absorb. She also said given the projected $2 billion shortfall in the 2015-17 budget, anything less than a $300 million reduction would be a hard sell. But Harsdorf said she has long supported giving the System more flexibility.
Democrats panned the plan. Senate Minority Leader Jennifer Shilling, D-La Crosse, said Walker’s proposal would “defund and privatize” the UW System and lower the quality of education.
“Rather than investing in pro-growth initiatives to strengthen communities, Gov. Walker has proposed deep cuts that will lead to more layoffs across the state,” Shilling said in a statement.
Democratic Reps. Chris Taylor of Madison and Gordon Hintz of Oshkosh, who sit on the Legislature’s budget committee, vowed to fight the cut. “The UW System is one of the largest job creation engines in the state,” Hintz said in a statement. “How is Wisconsin supposed to compete for the jobs of tomorrow with a slash and burn approach to education?”
Frequent UW critic Sen. Steve Nass, R-Whitewater, said he was not ready to give up control to the “unelected” Board of Regents that runs the System. Nass, vice chairman of the Senate higher education committee, said Walker’s proposal “would leave tuition-paying middle class families absolutely defenseless from potentially massive spikes in tuition and fees” in two years.
The chairman of the Assembly’s higher education committee, Rep. David Murphy, R-Greenville, said the plan offers “long-term opportunities to save taxpayers money” and autonomy for campuses.
But Murphy said he wants to make sure the System continues to prioritize enrollment of in-state students. Murphy said lawmakers also will discuss whether $300 million “is an appropriate level to cut.”
A UW System document obtained by the State Journal lays out more details of the plan, including:
The System would receive a dedicated allotment of state money funded by state sales tax revenues. Increases would be based on the Consumer Price Index. It would mimic how the state’s Transportation Fund is supported, in which road repair and construction are paid for through a gas tax.
Shared governance and faculty tenure would be managed by Board of Regents’ policy rather than by the Legislature through state law. Regents vice president Regina Millner said Tuesday the board is “committed to ensuring that both remain hallmarks” of the System.
UW employees would remain public employees and in the state’s retirement and benefits program. However, the System would gain the authority to provide pay increases.
The state would retain ownership of campus buildings, but the public authority overseeing the System would negotiate a master lease with the state.
The Board of Regents would remain in place as the governing body of the 26-campus system, with no changes to how Regents are appointed or how the board is structured.