Friday, May 13, 2011

LV Chamber: NSHE *is* reform. So will you support enhanced state investment for higher ed?

Editor's note: This article by Jim Richardson, NFA Lobbyist, and and Gregory Brown, NFA Vice-President, originally ran in the NFA's print publication, The Alliance. For the full issue in which it appears, click here.

We in the Nevada System of Higher Education were heartened recently to see the Las Vegas Chamber of Commerce state in a letter that more revenues may be required to deal with the many needs of the State of Nevada, especially in the area of education.

We are also heartened that, in its March 1 “reform agenda,” the Chamber endorsed a policy change that the System has long sought — allowing campuses to retain student tuition and fees. They also endorsed an end to the state’s antiquated “per-pupil funding system,” which has emphasized quantity of enrollment over quality of output.

We appreciate as well that, in the 2011 update of its study of public sector compensation, the Chamber again found (as it had in 2009 and 2010) that Nevada higher education instructional faculty and staff are paid below the national average — and that the gap has widened since 2008.

“[H]igher education instruction [is paid] 91 percent of the national average, a decline from last year’s 95 percent as the number of instructors fell from 3,600 in the prior year to 3,400 in 2009.... Nevada higher education instructional employees [rank] 34th in the nation, a drop from 30th in the nation in 2008."

And with another round of across-the-board pay cuts of five percent all but certain in the coming biennial budget, Nevada is clearly losing its competitive position in the market for talented researchers and teachers. Thanks in part to the support of the Chamber, Gov. Brian Sandoval and Democratic leadership have jointly proposed economic diversification legislation (AB 499) for Nevada that would assign a prominent role to NSHE. (We are concerned that, so far, no funding source for the Knowledge Fund in AB 499 has been found, but are hopeful that additional revenues will be allocated for this effort.)

Clearly, the Las Vegas Chamber gets it —Nevada should be supporting quality, affordable, higher education, not out of generosity but out of economic self interest.

Grave Concerns about Tactics

However, we have grave concern about the political strategy that the Chamber seems to be advocating in its letter — placing unrelated conditions on its support for a balanced, fair and stable revenue stream to support adequate public investment in NSHE institutions.

From the Chamber's letter:
Although it is not clear what the Legislative budget committees will recommend, our review has led us to believe that additional tax revenue may be necessary. However, let me be clear: The Chamber’s willingness to support additional tax revenue is absolutely dependent on the passage this year of significant and meaningful reforms that will fix systemic problems that are plaguing our state. Meaningful reform includes:
  • Fixing the Public Employees Retirement System (PERS) to reduce the $10 billion unfunded liability and lowering the cost of providing this benefit [in the future]
  • Discontinuing the State Retiree Health Insurance Subsidy through the Public Employees Benefits Plan (PEBP) for new employees
  • Reforming the collective bargaining process and providing local governments with the flexibility they need to weather this
  • Transforming K-12 education to encourage and reward results
  • Retooling higher education
This list of reforms demanded by the Chamber would hold higher education in Nevada hostage to reforms in areas that impact NSHE very little if at all, and over which NSHE has no control.
  1. Very few NSHE professional employees are in PERS. (Only people who are in PERS when they are hired may remain in PERS; that represents a very small percentage of professional employees. NSHE classified staff are in PERS.) The proposed change in access to PEBP retirement benefits for new hires will make it harder for NSHE to hire and retain faculty in the future. Moreover, the proposed change does nothing to reduce expenditures this biennium.
  2. NSHE employees are NOT covered by the local government collective bargaining statute, NRS 288.
  3. NSHE has virtually nothing to do with reforming K-12 education, except that several NSHE institutions are involved with teacher training — and are doing a very effective job.
  4. NSHE’s need for “retooling” is not detailed in the letter, so it is unclear what the Chamber wants. The implication that NSHE is not being involved in redefining its mission is patently false. This very general demand for “retooling” seems an excuse to include NSHE funding, never mind the collateral damage.
The Chamber letter and report should have pointed out to readers that NSHE institutions have been hit much harder than any other area for which the state is financially responsible.

State support for Nevada’s higher education system was cut over 20 percent for the current biennium, whereas many other areas saw much smaller cuts, or even increased funding. (See Table 1, source State Budget Office.)

This same pattern is presented in the Sandoval budget for the next biennium, with NSHE slated for another huge cut in state support (another $162 million cut from current spending) — even if NSHE receives the controversial $121 million in revenues from the counties that is recommended by the governor. (See Table 2, source LCB Fiscal Staff.)

Without the $121 million, the shortfall in government support for the next biennium would be an astounding $283 million compared with the level of funding this year. Budget cut plans submitted by NSHE institutions for the upcoming biennium demonstrate that, if the Sandoval budget is approved, more than 1,000 additional positions will be cut, along with many more degree programs and departments, affecting thousands more students.

It is important to note the extent to which NSHE institutions, and particularly faculty, have already reduced expenses and streamlined academic programs in the past few years. During the last biennium, in response to the 20-percent reduction in
state support, NSHE cut more than 700 faculty and staff positions around the state. Only last spring, in order to implement the 6.9-percent cut passed in the February 2010 special session, UNR and UNLV undertook a painful curricular review that resulted in the elimination of more than two dozen academic programs and the redeployment or lay-offs of more than 50 tenure-eligible and tenured faculty. Administrative expenses have been streamlined through a System-wide Efficiency and Effectiveness Task Force, student fees have been sharply increased, and other measures have been taken to reduce costs and further enhance flexibility in the coming biennium.

Indeed, toward this end, NSHE faculty supported additional workloads for tenured faculty without compensation, while tenure-eligible faculty and all professional and classified staff took unpaid furloughs. Furthermore, the faculty supported an amendment to the NSHE Code that had been sought by the Chancellor and enacted last spring to pass through a legislatively mandated across-the-board pay cut up to 6 percent per annum. These represent considerable sacrifices by faculty, who, as already noted, are paid on average below the national median.

Finally, there is significant ongoing curricular reform at all institutions and across the System to facilitate more rapid progress towards degrees.

A Simple Request

We therefore ask the Las Vegas Chamber of Commerce and similar groups not to stand by and allow the dismantling of a fine system of higher education as a political strategy that links NSHE funding to issues over which NSHE has no control and which do not impact NSHE.

This approach seems misguided and would be destructive. Higher education in Nevada is being held hostage in a fight that we did not pick or want. If this strategy is pursued, the State of Nevada will be the loser — and the consequence will be a brain drain of unprecedented magnitude, as many more of our faculty give up on Nevada and leave for other opportunities.

The state’s business community must not tolerate the dismantling and perhaps even the closing of institutions, devastating educational opportunities for thousands of students, and ruining the careers of countless educators who came here in good faith to help build a better Nevada.

Now is the time for business leaders to join students, faculty, alumni and community members across the state — join people who have given voice to their concern about the future of Nevada and who have stood up to oppose an unbalanced, cuts-only approach to higher education.

We ask the Las Vegas Chamber and other business groups to support a quality, affordable higher education system and to demand adequate funding for NSHE to help secure a more stable, prosperous future for the state.

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