Chris Vetter

With the announcement of a state surplus of nearly $1.4 billion over the next two years, the University’s chances of getting increased funding from the state might have improved.
State officials and University administrators remain guardedly optimistic, but insist the favorable economic forecast will not necessarily translate into more University funding. When Gov. Arne Carlson announced tentative plans for distributing the budget surplus Tuesday, the University was not mentioned as one of the beneficiaries.
Carlson’s plans, which must be approved by the Legislature, include state tax relief, money for the state’s reserve and additional funding for K-12 education.
The University sent their biennial budget request to Carlson in October. The request calls for about $115.5 million additional dollars per year over the next two years from the state, bringing the total request to $580 million each year. This represents a 19 percent increase over the funding level for this year.
Richard Pfutzenreuter, vice president for Budget and Finance, said he was not overly surprised by the surplus announcement. “I had heard estimates last summer that ranged up to a billion dollars,” he said.
While the significant request increase seems well timed in light of the surplus, Pfutzenreuter said administrators have been optimistic about the ambitious request since they began putting it together more than a year ago. “Whether there was a surplus or not we would have put this request in,” he said.
Pfutzenreuter is one of three University representatives to a budget discussion group that has been meeting regularly with Carlson. He said the governor has been very supportive of the request thus far and by Dec. 25 could make a recommendation to the Legislature.
Tom Stinson, a state economist and University economics professor, said if the University is to receive any portion of the surplus, it would come out of pool of about $550 million in available funds. The rest of the surplus is tentatively tied up in the projects that Carlson outlined Tuesday.
“If the University were to get its full budget request, they would be getting a much larger than normal share of the surplus budget,” Stinson said. “The University is asking for 40 percent of the surplus available after the K-12 cap is met.”
Stinson said Carlson and many legislators have agreed that increased education funding is needed for K-12 schools, which accounts for about $337 million of the surplus.
But Senate Majority Leader Roger Moe, DFL-Erskine, said the odds of the University receiving more funding increased when the surplus was announced.
“The University’s budget request stands a much better chance than if the state’s forecast had been bad,” Moe said. Moe said the University will probably not receive all of its requested funds, but should receive a large percent of the request.
“Higher education in general can make a better case than anyone for an increase in funding than anywhere else in the state,” Moe said.
House Majority Leader Phil Carruthers, DFL-Brooklyn Center, said the University needs additional money to help alleviate rising tuition.
“Lean budgets from the state each of the past few years has caused a higher tuition burden on students,” Carruthers said. “We need to put more resources into education.”
The University will also be competing with other state colleges for additional funding, Stinson said. The University’s biggest competitors for funding are health care, crime prevention and K-12 education, Pfutzenreuter said, and added that other short-term needs often hurt funding requests for long-term investments.
He said when there is more money on the table, every group thinks they deserve a bigger share of the pie. “What we need to do very quickly is turn our attention to making our case in the House and the Senate,” he said.
This is not the first time the state has had a large surplus. The state had a surplus of $824 million dollars two years ago when the University made its last budget request. The University asked for an increase of $87 million for that biennium, and received $60 million.