Rutgers president says declining aid for capital projects a concern

TRENTON – While college presidents in attendance at the Senate Budget and Appropriations Committee’s Higher Education Services hearing Monday were grateful for increases in state aid, there was concern that continued cuts in capital funding assistance will hurt the colleges and universities.

In addition, Richard McCormick, president of the N.J. Presidents Council, told the committee that while he believes a double-digit tuition hike could be avoided, it still is too early in the budget process to tell.

The overall Higher Education Services budget, which consists of money from the State and Treasury departments, is slated to be $1.38 billion for fiscal year 2012, which is less than 1 percent lower than the $1.39 billion allocated in fiscal year 2011.

Of that, $714.2 million will go to public institutions in direct aid and $134.8 million to cover operational costs at county colleges.

The budget also calls for an increase in the amount allocated for – and the number of students who receive – Tuition Aid Grants. The FY 2012 spending plan calls for $319.5 million in TAGs, an 8.5 percent increase from $294.3 million allocated in FY 2011. That amount will provide 66,733 students with such Tuition Aid Grants, which is 2,418 more students than were helped in the 2010-11 school year.

County college students will also be helped with TAGs, as the amount appropriated for those students went up 21.5 percent, from $9.6 million to $11.7 million. The number of students who will be helped are 16,672, or more than 2,100 students.

While funding assistance for students is up in the FY12 budget, there is less money going toward capital improvement debt service payments, or the “Higher Education Capital Improvement Fund Act.” For 2012, the payment by the state is $8 million less, from $43.9 million in FY 2011 to $35.9 million in FY 2012. The lowered payment reflects a decline in the state’s debt service obligations.

McCormick, president of Rutgers University and the New Jersey Presidents’ Council, told the Senate Budget committee that the trend of declining aid for capital projects is of great concern, given that many of the schools are overcrowded.

“Our facilities are in need of significant upgrades and expansions,” he said. “If the state’s colleges and universities are to continue to play a critical role in New Jersey’s economic growth and recovery by educating and training our citizens, creating jobs, broadening opportunities and research partnerships with New Jersey employers, and improving the business climate in New Jersey, they must have the support they need.”

McCormick added New Jersey has “the very undesirable” distinction of being the largest exporter of college-bound students.

“Too many residents who aspired to attend college in New Jersey are forced to leave the state to attend institutions that can guarantee them places in programs with superior facilities,” he said. “These students are lost to the New Jersey workforce, often permanently.”

Some student funding programs saw a cut, such as STARS. That program declined a whopping 64 percent, with tuition provided to eligible students slipping from $3,500 per semester to $1,250.

Legislators on the budget panel asked if a large tuition hike could be avoided, one that is at least 10 percent or higher.  While McCormick said he believes he could avoid a double digit increase, he said it was too early to tell, given that the budget  has not been enacted.

Things are  slightly different this year regarding potential tuition hikes. Last year, there was a 4 percent cap on hikes for tuition and general fees. Any school that increased more than that faced reductions in state funding. That clause has not been included for the FY2012 budget.  Rutgers president says declining aid for capital projects a concern