Highlights of Higher Education budgets in the joint budget agreement

Under the joint budget, state support for higher education – the UNC System and Community College System – fails to ensure that adequate resources are available to provide quality education services to the more than 400,000 students enrolled in public colleges and universities across the state.

The joint budget includes a new fixed-tuition payment option that would guarantee that tuition does not increase during a specified time period for future students attending public four-year universities within the UNC System. The joint budget also limits the amount of revenue raised through student fees at public four-year universities each year. While these actions aim to address the cost of college, they fail to ensure that North Carolina’s four-year public universities have the resources required to ensure quality education services.

Steady erosion of state support for higher education in recent years has played a direct role in the increasing cost of college in North Carolina. Tuition at community colleges has increased by 81 percent since 2009. At public four-year universities, state funding per student remains more than 15 percent below its 2008 pre-recession level when adjusted for inflation – equating to hundreds of millions of dollars in funding cuts. This pressing reality is unaddressed in the joint budget negotiated by lawmakers.

Highlights from the joint budget for higher education:

Community College

• Provides $41.8 million in state funding for salary increases and one-time bonuses for community college employees. Permanent full-time state employees in the Community College System’s central office will get a 1.5 percent permanent pay increase and a 0.5 percent one-time bonus payment. This state funding also includes retirement contributions for eligible state employees.
  • Half of the $41.8 million is one-time, non-recurring funding.
  • Funding for pay increases can be used for merit pay, across-the-board increases, recruitment bonuses, retention increases, and other compensation increases as determined by community college boards of trustees.
  • The $41.8 million for pay increases includes a $10 million transfer from existing funds that lawmakers appropriated in their original biennial budget last year.
• Reduces state funding by $26.2 million to account for expected decline in enrollment.
• Provides a total of $12.4 million in state funding to restore some of the recurring funding cuts to community colleges in prior years. Only half of this restored state funding is permanent, meaning community colleges will once again have to find $6.2 million in permanent cuts following the upcoming academic year.
• Provides funding to administer the Connect NC Bond program, passed by NC voter early this year. The Community College System is set to receive $350 million of the bond proceeds for facility construction and renovation.
• Provides $6 million in one-time state funding to purchase instructional equipment and technology at all 50 community colleges.
• Provides $3.4 million in one-time state funding for the Gaston Community College Center for Advanced Manufacturing to be used for capital and equipment.

UNC System

• Provides $84.8 million in state funding for a 1.5 percent salary increase for permanent full-time UNC System employees, one-time merit-based bonuses for state employees, and retirement contributions.
  • Nearly half of these dollars are one-time, non-recurring funding.
• Provides $31 million in state funding for enrollment growth in UNC System.
• Provides $2.3 million in one-time state funding for technology and academic support strategies to recruit, retain, and graduate students who have started by not finished their undergraduate degree.
• Restores $16.3 million in state funds lost by institutions within UNC System as a result a cap being placed on the amount of state funding universities can spend for advancement activities (e.g. fundraising). A special provision in the joint budget repeals this cap.
• UNC System required to reduce its operating budget by an additional $16.3 million – referred to as a management flexibility reduction – and builds onto prior reductions in recent years. This funding cut essentially offset the additional state funding provided as a result of repealing the cap on advancement activities spending.
• Provides $3 million for the UNC School of Medicine’s Asheville Campus to support administration, faculty, and related programs.
• Provides a total of $8 million to ECU’s Brody School of Medicine to provide support for the school due to lost revenue. Half of the additional state funding is non-recurring.
• Provides $3.5 million in recurring state funding for a Principal Preparation Program that will provide competitive grants for school leadership development.
• Includes an additional $5.8 million in state funding special education scholarships for eligible K-12 education students.
• Creates a reserve fund to allow forward funding for existing private voucher program (named Opportunity Scholarship Program). A total of $34.8 million in state dollars are allocated to the reserve fund to ensure that funding is available to expand the program in the years ahead.