Erickson Testimony Follows Governor’s Budget Proposal
NMU President Fritz Erickson testified Tuesday in Lansing before a joint hearing of Senate and House higher education appropriations subcommittees. The Senate and House will draft their own budget proposals after Gov. Rick Snyder unveiled his executive recommendation earlier this month. The governor’s budget proposal invests an additional 2 percent in state university operations, distributed using a modified version of the existing performance funding formula. NMU would receive a performance increase of 2.1 percent, or $916,000 on top of its operations funding of $44.3 million.
The higher education increase represents the largest use of general fund dollars in the governor's proposed 2016 budget.
“It’s early in the process, but we are pleased with the governor’s proposed investment in higher education,” said Gavin Leach (Finance and Administration). “I think he looks at higher education as being a leader in bringing about change in Michigan. We know there are important budgetary issues to address in the state and we appreciate the continued commitment by the governor and state legislature to help keep Michigan's universities affordable and accessible. The governor is also a strong advocate for career and technical education and Middle College programs, which NMU offers.”
The governor’s proposal would require universities to limit any tuition increases to 2.8 percent or less in order to receive new performance funding. The performance metrics are: weighted undergraduate completions in critical skills areas, research expenditures, six-year graduation rates, total completions, administrative costs as a percentage of core expenditures and the percentage of students receiving Pell Grants.
Snyder also wants to cap unfunded accrued liability payments for the seven universities, including NMU, that participate in the Michigan Public School Employee Retirement System (MPSERS). Payments would be capped at the fiscal year 2012 level, with the state making payments for amounts over the cap.
“It’s encouraging that the governor has taken this step toward relieving the significant impact of this state-mandated liability on the budgets of participating MPSERS universities,” said Leach. “This has been a concern of the seven schools for some time and we have consistently raised the issue during the state budget process. Under his plan, we would have a predictable cost for our retirement payments from this point forward, allowing us to accurately factor MPSERS into our budget and long-term planning.”