Illinois budget: 2.3 percent more for higher ed?
By Sharita Forrest, Assistant Editor 217-244-1072; slforres@illinois.edu
The UI would receive a $13.3 million increase in its general funds appropriation during fiscal year 2008, which will begin July 1, if the budget proposed by Illinois Gov. Rod Blagojevich on March 7 is approved by the Illinois General Assembly. Overall, Blagojevich proposed increasing general funds appropriations for higher education operations and grants by $51.9 million, or 2.3 percent, over FY07 levels. Blagojevich proposed a 1.9 percent increase – to $721.5 million - in the UI’s general funds appropriation, a $99.8 million capital budget, plus an additional $119.4 million for capital projects from the state’s Opportunity Returns economic development program. The UI would get $10.7 million for general repairs and renovations, the highest priority item on its capital budget request; about $6.2 million of that would be for projects at the Urbana campus. Additionally, the Urbana campus would get $55.1 million for remodeling Lincoln Hall. With funding from the Opportunity Returns program, Urbana also would receive $42 million in matching funds for construction of the Electrical and Computer Engineering Building, $16.9 for the South Farms project and $60 million for constructing the National Center for Supercomputing Applications Petascale Computing Facility. The UI had asked for an 8 percent, or $101 million, increase in its operating funds and a capital budget of $262 million for FY08. Although Blagojevich’s budget proposal fell short of the UI’s request, any increases – especially in funding for capital projects, which has been scarce in recent years – was good news to UI President B. Joseph White. “The governor’s budget recommendation is welcome news for public higher education in Illinois and for the UI, which would put the increased funding to good use in maintaining the excellence on our three campuses that 70,000 students and their families expect,” White said in a written statement. “The UI will work with the governor and state legislators to secure approval for the recommended higher education appropriation and capital budget, and to share our research-based expertise as the state addresses the many challenges it faces. Public higher education is clearly a priority for the administration and the legislature, and the UI is committed to fulfilling our part of the public compact by providing an affordable and accessible college education, world-class innovation and research, and results-oriented public service.” Blagojevich recommended funding grants at their FY07 levels, except for a $1 million reduction in funding for the Higher Education Cooperation Act program and a $90,000 reduction in funding for the Center for Applied Research. Two new grants were added: a $1 million grant for the Science, Technology, Engineering, Mathematics Initiative, which encourages students from underrepresented groups to participate and achieve in STEM disciplines; and a $600,000 request for the Integrated Student Information Systems, to expand and enhance the Teacher Data Warehouse, the Shared Enrollment and Graduation System, the High School Feedback Report and the Course Applicability System. Blagojevich also presented a plan for bolstering the state’s pension system by leasing out the Illinois Lottery for $10 billion, and refinancing the pension system debt by issuing $16 billion in pension obligation bonds. He said the plan would save more than $60 billion in interest by 2045 and enable the pension program to reach a 90 percent funding ratio by 2040, five years earlier than the plan established by the Legislature in 1995. In an effort to decrease the state’s multibillion-dollar budget deficit, Illinois began a five-year plan of reduced appropriations to the State Universities Retirement System and its four other retirement plans under a law enacted in 2005. In FY06 and FY07, the state’s “pension holiday” reduced contributions to the retirement programs by $1.2 billion each year. The state’s five pension plans are among the most under-funded public retirement programs in the nation at 60.5 percent. The state has about $40.5 billion in unfunded obligations for the plans, which provide pensions for state workers, teachers, university employees and judges. Additional funding for the pension system and other initiatives would come from a controversial $6 billion tax on business gross revenues called the Tax Fairness Plan, a program that Blagojevich presented that is aimed at closing tax loopholes and forcing businesses that make more than $1 million annually to pay their share of state income taxes.
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