With the fall 2010 semester just around the corner, a steep budgetary cliff is quickly coming into view for the Arizona university system, leaving much to discuss at the Aug. 5 and 6 Arizona Board of Regents meeting.
In 2010, Arizona’s three universities received $225.9 million in State Fiscal Stabilization funds, commonly known as stimulus dollars, to help balance their respective budgets. In 2011, that amount is expected to drop to zero.
However, despite the lack of federal stimulus dollars, the fiscal year 2011 All Funds Operating Budget will increase from $4.6 billion in 2010 to $4.8 billion in 2011 — an overall increase of 4.6 percent.
Most of the increase will come from increased student tuition and fees.
According to the regents meeting agenda, total tuition and fee revenues are estimated to be $1.3 billion, an increase of approximately $143 million over the 2010 budget.
“”Financial aid is primarily, almost exclusively funded through university funds and it has been a longtime commitment that a particular amount was going to be earmarked for financial aid,”” said Johnny Cruz, assistant vice president for communications at the UA.
Mirroring the substantial increase in university tuition, the amount of money available for financial aid will be approximately $329.9 million, or 26 percent of regular tuition and fee revenues, an increase of $42.6 million or 14.8 percent over fiscal year 2010.
“”The intent of the regents when we set tuition last year was to allow the universities, given the situation with the state, to provide ongoing services throughout the system at a comparable level,”” said Regent Rick Myers. “”So the thought process in setting the tuition is that a significant proportion of that is for financial aid.””
In addition to increased funding for financial aid, the university system is expecting a slight increase in revenue received from gifts, grants and contracts for the system as a whole — $1.2 billion for 2011, an increase of $36.3 million from 2010.
According to Jennifer Grentz, assistant vice president for public affairs for the Arizona Board of Regents, funding from gifts, grants and contracts varies depending on the university.
“”Outside funding is on a university-to-university basis,”” she said.
Speaking specifically for the UA, Cruz said the university’s commitment to pursuing research grants and other forms of outside funding has never been higher.
“”Obviously, private donations play a role in this, as does research funding,”” he said.
The 2011 fiscal year state operating budget for the UA is currently estimated to be $520 million, the vast majority of which will come from state funds and tuition dollars.
Due to the current budget crunch, the board of regents will devote time to formulating a realistic preliminary budget for fiscal year 2012, according to the agenda.
While formulating the 2011 budget during the 2009-10 academic year, the regents directed the universities to increase their preliminary requests in order to fully recognize future needs.
The universities developed a list of requests that includes student enrollment growth; a focus on improving student access and affordability through partnerships with community colleges and branch campuses; and increased student financial aid, according to this week’s meeting agenda.
Considering the fact that the Joint Legislative Budget committee predicts a state budget deficit of between $368 million and $1.2 billion for the 2011 fiscal year, additional funding from the state in years to come is not very likely. Since 2008, the university system’s state funding has been cut by $229.4 million, or 20 percent, while student enrollment has increased by more than 10,000.
In other words, the UA will have to continue to look for funding elsewhere.
“”The university did a tremendous job in securing research funds that were made available this year. That has certainly been a new source of funds,”” Cruz said. “”In times like this, you have to be creative and you have to hustle.””
