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Budget battle continues, math differs

As the House and Senate work toward finalizing their budgets by March 8, USF still believes there are fundamental differences in the way the budgets are being calculated.

The House Joint Legislative Budget Commission, chaired by Rep. Denise Grimsley, R-Sebring, proposed cutting all universities by 8.4 percent – a method of equal reduction traditionally used in years of budget cuts to higher education. The Senate, whose budget committee is chaired by Sen. JD Alexander, R-Lake Wales, initially proposed to cut USF’s budget by 58 percent, but reduced it to 23.5 percent in a new formula that bases funding to a university on its “carryforward” cash reserves.

Under the original plan, Alexander said USF could continue “business as usual” and not be impacted.

Yet Mark Walsh, USF director of governmental affairs, said the Senate calculates cash reserves differently than the University.

“We have had to draw down substantially on our reserves already to help offset prior years’ cuts in state support and the end of federal stimulus funding assistance,” he wrote in an email to The Oracle. “Just because we had a certain amount of money on December, 31, 2011 (when the Senate calculated USF’s reserves to be $163.5 million), doesn’t mean we will have that same amount available by June 30, 2012 when the reductions kick in.”

Board of Trustees (BOT) Chairman John Ramil said during Thursday’s BOT meeting that the Senate’s formula for applying the cuts were unfair.

“As soon as a dollar comes in the door, you don’t have to spend it,” he said. “You reward people for thinking that way. And we will now be punished for behaving that way. The numbers being thrown around are not grounded in any type of reality. The proposed budget cuts are too deep, and it’s inaccurate to say we’re hoarding cash.”

The belief that USF can use all of its reserve funds is inaccurate, he said.

“Reserves are not just cash sitting around for a rainy day,” he said. “I don’t even like the term reserves.”

John Long, Chief Operating Officer for USF, said that while the University does have some flexibility with the extra money, each branch campus has its own reserves that can’t be altered by any other campus in the USF System. USF Health also has its own reserve fund. Additionally, money from the reserves must be moved into other areas with limited funding, he said, like construction projects, for which USF received no Public Educational Capital Outlay (PECO) funds from the state last year, nor anticipates to this year.

“It doesn’t help when the roof blows off,” he said. “One hurricane, and it’s going to be millions of dollars in damage. It’s a crystal ball that nobody knows if it’s going to break. We didn’t receive PECO last year, and it’s been drastically reduced in the past few years.”

Yet finding solutions for offsetting the cuts aren’t easy, Ramil said, particularly when they come at the expense of students paying higher tuition.

On Friday, the Florida House of Representatives voted 85-28 in favor of a bill that allows Florida State University (FSU) and University of Florida (UF) to freely raise tuition based on the market rate.

However, USF will have to find an alternate solution to offset potential budget cuts that continue to differ between the House and the Senate.

According to the bill, in order to qualify to raise tuition a state university must reach at least 11 of 14 benchmarks, which include an average GPA of 3.8 or higher for incoming freshman and an average SAT score of 1800 or higher.

The current USF freshman class has a 3.91 GPA overall, but the average SAT score was 1203.

“Some of (the criteria) were a little vague, so we’re trying to get a handle on where we stand right now,” Walsh said.

While Walsh said achieving the 11 benchmarks is still a goal for the University, raising tuition is not necessarily something USF administrators think is the best solution to offset budget cuts.

“Students and their parents are saying they’re paying 15 percent more every year and not seeing anything out of it,” USF Provost Ralph Wilcox said at a Board of Trustees (BOT) meeting Thursday. “We’ve got tot put the brakes on this.”

The House and Senate will meet today to resume talks on the higher education budget.