Louisiana’s higher education leaders are floating several suggestions to help mitigate the nearly $400 million in budget cuts that could come to the state’s public universities and colleges next year.
The following ideas are currently being discussed (though some of these suggestions have already been vetted — and dismissed — by the Louisiana Legislature in years past.)
State lawmakers — and likely Gov. Bobby Jindal — would have to sign off on all the proposals.
Redirecting dollars used for business tax exemptions toward higher education
The Legislature should temporarily repurpose some of the money that goes toward business tax exemptions now, and use it for higher education purposes. Some of the state’s tax exemptions and credits have grown in price over the years, such that they are worth far more now than they were when the exemptions were originally implemented.
Higher education leaders are suggesting some of the money included in the growth part of exemptions be transferred to the higher education budget. In other words, Louisiana would be devoting as much money to the exemptions as it did when they first went into place. But now, it would use some of the “growth” area of the exemption to fund the higher education budget.
Higher education leaders are hoping this plan would meet Jindal’s standard for a “revenue neutral” proposal. The governor has said he won’t approve any budget management proposal that could be interpreted as tax hike.
Several legislators — including many Republicans — don’t agree with Jindal’s interpretation of a tax hike. They do not consider reducing business tax credits and exemptions to be the same as a traditional tax increase.
A few legislators have also discussed rolling back one tax credit or exemption and replacing it with a similar tax break for people and companies that donate directly to higher education foundations in the state. The foundations would then transfer the donations associated with this new tax credit directly to their universities and schools to help cover operating budget costs.
Charge different amounts of tuition for different programs
Schools should be able to increase the price for academic programs that cost more to run.
While this won’t work on every campus, Louisiana’s flagship university, LSU in Baton Rouge, could certainly charge more certain degrees without losing out on students, according to higher education leaders. It is more expensive for LSU to run a program like petroleum engineering than most liberal arts departments.
Differential tuition wouldn’t be very effective though, unless Louisiana’s generous scholarship program — Taylor Opportunity Program for Students — was run slightly differently. TOPS would have to be capped for at least some degree programs, so that the state didn’t end up raising tuition for certain degrees — like engineering — and then paying more out in scholarships to cover its higher costs.
Higher education officials have floated the idea of charging higher tuition for certain degree programs in the past, and the Legislature has never approved such a proposal.
Using more private contractors to perform services at public universities and colleges
Higher education leaders feel that some services could be provide more cheaply if colleges and universities were able to higher companies from the private sector to complete them, instead of using public sector employees.
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Julia O’Donoghue is a state politics reporter based in Baton Rouge. She can be reached at [email protected] or on Twitter at @jsodonoghue. Please consider following us on Facebook at NOLA.com and NOLA.com-Baton Rouge.