As higher education nationwide struggles with continuing budget cuts resulting from state budget crises, many institutions are turning to a new model — a model that makes them less reliant on state funds.
Take the University of Oregon, for example. The school relies on state appropriations for only 7 percent of its operating budget, according to The Oregonian.
That contrasts with LSU, which just dropped to 49 percent state funding last semester — falling below 50 percent for the first time.
Education administrators like University Chancellor Michael Martin have repeatedly said more independence from the state government would give the University more financial stability because its budgetary fortunes would not rise and fall with the state’s.
It’s also argued that such independence would be better for the state and its citizens, which would theoretically have to pay less.
Louisiana, for example, pays $292 per capita for higher education, according to the national report card on education. On average, that’s $10 for every $1,000 of personal income for Louisianians.
In the Southeastern Conference, only Alabama pays more, with $305 per capita, according to the national report card.
But if a public university is paid less by the state, one must wonder where it gets the money to operate.
One solution is to partner with private companies to fund certain parts of the university. Oregon, for example, has for the past few years drastically weaned itself off public funding for construction, relying on private funds instead.
Edward Ray, president of Oregon State University, said private funding for construction in the Oregon University System grew from $20 million in 1993 to $113 million in 2007.
State-funded construction for the entire system, on the other hand, totaled only $3.5 million — significantly less money than the state gives LSU alone for construction, let alone the entire LSU System.
But while Oregon administrators tout this private investment as a boon to the school, some say relying on corporate funds could pose problems for the universities.
“There are risks in such a transformation,” wrote the Portland Register-Guard editorial board in September. “One is that legislators and the public will conclude that universities, having proven themselves capable of attracting private support, can survive a further withdrawal of state funding.”
The board also warns that such a transformation might give undue influence to the corporations who contribute.
“Donors, seeing a continued erosion of the public’s share of a partnership in financing higher education, will insist on a larger voice in the development and governance of universities,” the editorial said.
LSU administrators have public partnerships that could provide the University with some budget stability.
“We’ve got to go from 50 percent dependent on the state to well below 40 or 30,” Martin said. “We should always be a public University, but we should not always rely on the public to support us.”
The University already has some proposals similar to Oregon’s building projects.
The new $60 million Business Education Complex, for example, has half of its fund being paid for with state capital outlay funds and half from private donors.
Another proposed project includes finding a public partner to fund reconstruction of the old student housing on Nicholson Drive. Martin said the administration has had “ongoing discussions” with possible donors for that project, as well as potential projects like a proposed microbrewery.
“We need to maybe spend a little more time on those things,” he said.
Another major solution is increased tuition. Read tomorrow’s edition of The Daily Reveille for a more in-depth look at possible tuition increases in Louisiana.
 
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Contact Matthew Albright at [email protected]