Budget mandates could raise university expenses by $17 million
A Senate version of the 2013 state budget may be the exception to South Carolina’s streak of higher education cuts, but it may not be enough to cover new expenses brought on by state employee mandates.
According to the $6.6 billion spending plan approved by the Senate May 24, USC would receive a total of over $99 million for instruction and general academic services for the 2012-2013 fiscal year. That’s $2.5 million more than last year, yielding the first increase in funding from the state since the first major recession cut in 2008.
The same budget, however, mandates increases in employee salaries, retirement and health insurance that would bring USC’s expenses up $17 million. However, state funding would only allot $7 million of its annual taxpayer share to cover those additional expenses, leaving the university to garner the other $10 million through tuition increases and research revenue.
It’s a two-sided predicament for the university, according to Chief Financial Officer Ed Walton.
“There hasn’t been an employee pay raise legislation since 2008, but at USC and at other universities, that pay raise would come with a limited amount of funding,” Walton said.
The total funding amount would cover about 10.5 percent of USC’s reported operating needs for its academic mission, which excludes housing, athletics and deferred maintenance.
Before 2008, USC was funded by the state for nearly 22 percent of its budget.
Other specific budget provisions include $10 million to the School of Law, constituting the first state support of the law school’s replenishment initiative in over ten years. The state would also apportion a one-time allocation of $2.1 million and a recurring allocation of $2.8 million for Palmetto College, USC’s online campus initiative set to roll out with a pilot liberal arts program this fall. Vice Provost Michael Amiridis said these funds would allow for faster progress with transcribing courses for Palmetto College and constructing a new building for the law school.
“This is no surprise, since they represent priorities that President Pastides repeatedly articulated to members of the general assembly,” Amiridis said in an email. “I am optimistic that members of the general assembly will continue to recognize the value of USC and programs that support our academic mission.”
A $20 million growth in revenue due in part to lottery ticket sales has also led to a proposal for a $5.1 million provision to USC for deferred maintenance, $4.7 million of which would go to the Columbia campus.
“With students paying what you have to pay, we want to make sure that you’re getting the best faculty and the best facilities so that you get what it is you’re paying for in the time you are here,” Walton said.
With its Senate revisions, the new budget is now headed back to the house for re-evaluation. Walton said he hopes both houses will reach a conclusion by the end of June, but he anticipates that extended debates will draw out conclusions even longer.