President Susan A. Cole Testifies at 2013 Senate Budget Hearings

Montclair State University's President Susan A. Cole delivered opening testimony at the March 13, 2012 Senate Budget and Appropriations Committee public hearings on Governor Christie's proposed FY13 state budget.  Her statement to the committee follows.

Chairman Sarlo and members of the Committee, I am pleased to welcome you to Montclair State University, and I appreciate the opportunity to make a few comments about some of the pressing issues related to New Jersey higher education.  The more recent news is, of course, about the Advisory Committee report on The University of Medicine and Dentistry and Governor Christie’s endorsement of its provisions.  That report addresses important issues related to medical education and research, and it addresses a major realignment of certain higher education institutions in South Jersey.  There is, however, a prior report which was issued in December of 2010, the Report of another task force appointed by Governor Christie and chaired by Governor Tom Kean.  I would urge the members of this Committee not to lose sight of this earlier report while you pursue the implications of the new report, because the Kean Report provides extremely important recommendations about the larger context of higher education in the State of New Jersey.

Most particularly, and most convincingly, the Kean report strongly confirmed that New Jersey’s higher education institutions have been under-built and under-supported for decades, that the methodologies related to operating and capital support for higher education are broken, and that they require urgent correction.  That report makes clear that the state’s institutions which hold the responsibility for, and which do, educate the majority of students in New Jersey at the baccalaureate level and above have not been given resources or support commensurate to their quality, their size, or their importance to the economic prosperity of the state.  I am talking about institutions such as Montclair State University, that enrolls 18,500 students and grants about 4,000 baccalaureate, masters and doctoral degrees a year, just one of the twelve senior public institutions that collective educate over 178,000 students.  

As the Kean Report made clear, both operating and capital funding for these institutions has been seriously inadequate, and the current circumstances have no basis in reason or policy and work against the best interests of the State of New Jersey, its economy and its people.  This problem can be fixed.  Doing so is neither difficult from a policy perspective, nor is it particularly expensive compared to the massive investments made to support K-12 education in New Jersey.  As the State may move forward with initiatives related to medical education and mergers, it must not neglect the important core foundation of higher education in New Jersey, including the role of the community colleges in workforce development and the critical importance of the state colleges and universities in providing affordable, high quality opportunities to New Jerseyans for baccalaureate and graduate education, conducting important research, nurturing business/industry partnerships, and serving the communities of New Jersey in numerous important ways. 

To be more specific, the operating appropriations for all the public institutions are too low by any national standards, and, over recent years, they have been cut severely from an already very modest base.  State operating appropriations for the twelve senior public institutions declined from about $956 million in FY 2006 to $716 million in FY 2012, a 25% decline, just over the last six years.  During this same six-year period of funding decline, headcount enrollments grew by about 17%, from 152,000 to 178,000 students.  That sums to 26,000 more students and $240 million less in operating aid.  As a result, among the ten traditional senior public institutions, the average investment by the state per full-time equivalent student dropped from about $5,400 in FY 2006 to $3,800 in FY 2012.  Governor Christie has said that the average per pupil expenditure in New Jersey’s K-12 schools is $17,700.  Please consider that number against the $3,800 average per student at the state colleges and universities.  The comparison is stark, and I think we all understand that it costs considerably more to educate a student at a University level than it does, for example, in the fifth grade.  The Kean Report states unequivocally, “Erosion of operating support [for the state’s colleges] over the past 20 years has weakened the foundation of New Jersey’s economy and has caused a crisis.  It must be addressed.”

An average $3,800 in operating support for a student will not provide the kind of public higher education infrastructure that New Jersey needs to grow its economy and sustain the quality of life of its population, and it places far too heavy a burden on New Jersey students and their families, who consequently are forced to pay among the highest public tuitions in the nation.  And remember, I am talking about the average.  There are a number of institutions which by an accident of history are below that average.  For example, Ramapo College receives only $2,700 per full-time student.  Montclair State receives only $2,500 per full-time student.  Even a cursory look at the appropriations across the institutions would make clear that they are painfully low and that there is no meaningful basis for how the existing funds are allocated, leaving the students at some institutions grossly under-funded compared to their peers at other institutions.  The Kean report made this point forcefully:  “The allocation of the State’s operating support…has had no basis in reason for at least the last two decades.  As a consequence, there continue to be very substantial and unjustified differences in the level of support provided by the State for the education of students from one institution to the next.  Given the severity of the disparities, a rational correction to the situation should not be delayed any longer.” 

For decades now, there has been no methodology or policy employed in the allocation of State operating support.  No consideration is given to the nature, size, quality, growth, development, accomplishments, or circumstances of the institutions in providing annual operating support.  Every year by law, each of the twelve senior public colleges and universities produces a budget request to explain the institutions needs, accomplishments, and circumstances.  I am not sure who, if anyone, reads them.  But this much is clear, it has made absolutely no difference in regard to appropriation if an institution has enrolled more students, granted more degrees, improved its retention rates, achieved national recognition for its quality, developed programs important to the State or failed to do any of these things.  As a result, over many years, the disparities and irrationalities have just accumulated, bringing us to the current circumstance so strongly articulated by the Kean Task Force.

The second of the two issues I want to touch upon is the issue of support for the capital needs of the state’s higher education institutions.  As the Kean Task force forcefully stated, “After years of neglect, New Jersey needs to help build academic facilities for a 21st-century education at our colleges and universities, protect existing resources, and take the burden for financing these projects off the backs of students.”  New Jersey has been, as far as can be determined, the only state in the nation that, over the last several decades, has virtually abandoned making any capital investments in its higher education institutions.  As a result, in order to provide at least minimally for the advanced instructional and research needs of contemporary colleges and universities, each institution has gone out independently to the bond market, and the students of New Jersey have paid the debt service on those bonds through higher tuition and fees.  Even with the significant new construction, renovation and repairs that the campuses have undertaken on their own, the backlog of unmet needs has grown.  The state’s institutions have recently undertaken an assessment of their highest priority instructional, research, academic support, and infrastructure capital needs and the current need, including both public and independent, 2-year and 4-year institutions totals to approximately $6 billion, the largest portion of which is attributable to the twelve senior public institutions. 

New Jersey’s higher education community has long advocated for a capital initiative, but we recognize that $6 billion is too high a number to tackle all at once.  In 2005, our last formal state-wide proposal was for a capital initiative at the level of $2.7 billion.  That initiative, as you know, never came to fruition, and today, seven years later and in the face of continued accumulating needs, that number probably needs to be closer to $3.5 billion.  But whatever the number, and that is of course a decision for the Governor and this Legislature to make, a start must be made.  We also would strongly recommend a revolving fund structure, similar to the Chapter 12 methodology currently in use for the community colleges, so that the problem of capital support can be solved on a permanent basis, allowing New Jersey to keep up in an organized way with these needs and to preserve and improve the important asset represented by the state’s higher education campuses. 

Mister Chairman and members of the Committee, the higher education community understands the pressures of the current economic situation, but New Jersey cannot continue as it has done in the past if it is to have the educational and knowledge base that will keep the state competitive and prosperous in the years to come.  As the Kean Report noted, “Higher education in New Jersey has arrived at a decisive moment.  After twenty years of declining State funding and increased tuition, the fortunes of citizens and our state hang in the balance.  Student access to an affordable college education and the economic prosperity of our state are at stake.  New Jersey must decide to change course and provide greater support for higher education.”  Members of the Committee, the students of New Jersey look to you for your leadership in regard to these issues, and, on behalf of the higher education community, I can assure you that we stand ready to assist your efforts in any way that we can. 

Thank you.