2010 Higher Education
Content
Since the 1995 legislative session, the legislature has combined the appropriation for the six four-year campuses, five colleges of technology, and most of the Office of the Commissioner of Higher Education into a single, biennial lump-sum appropriation. Appropriations for the remaining units are contained in line items in the general appropriations act (House Bill 2). Long range building funds are appropriated in House Bill 5 for capital projects. The legislature also appropriates general fund to support the state pay plan that is applied to MUS employees.
How Many Students Are Enrolled?
The following table shows actual full-time resident and nonresident student enrollment for fiscal years 2000 to 2010 and projected enrollment through 2013. Resident enrollment has steadily increased over this period while nonresident enrollment has fluctuated, but reached a recent high-mark in FY 2010.
Montana University System Student FTE Enrollment Fiscal 2000 - Fiscal 2013
Fiscal Year FY 00 Actual FY 01 Actual FY 02 Actual FY 03 Actual FY 04 Actual FY 05 Actual FY 06 Actual FY 07 Actual FY 08 Actual FY 09 Actual FY 10 Actual FY 11 BOR Op Budget FY 12 MUS Est.* FY 13 MUS Est.* Resident Student FTE 24,605 24,851 25,566 26,226 26,828 26,322 26,422 26,263 26,279 26,740 28,398 28,526 28,883 29,102 Annual % Change 0.7% 1.0% 2.9% 2.6% 2.3% -1.9% 0.4% -0.6% 0.1% 1.8% 6.2% 0.5% 1.3% 0.8% Non-Resident Total Student FTE Student FTE 6,893 31,498 6,715 31,566 6,524 32,090 6,447 32,673 6,353 33,181 6,441 32,763 6,667 33,089 6,910 33,173 7,071 33,350 7,180 33,920 7,520 35,918 7,436 35,962 7,658 36,541 7,732 36,834 Resident as a % of Total 78.1% 78.7% 79.7% 80.3% 80.9% 80.3% 79.9% 79.2% 78.8% 78.8% 79.1% 79.3% 79.0% 79.0%
The Legislative Fiscal Division
Presents
FOCUS ON…
HIGHER EDUCATION FUNDING
October 2010 Fiscal Pocket Guide
How Does Tuition Fit in the Budget?
The Board of Regents is the sole authority in setting the tuition rates for the MUS. Tuition is not controlled or appropriated by the legislature. The following table shows the total current unrestricted budget for the Montana University System educational units for fiscal years 2000, 2008, and 2010. The state appropriated component (general fund and six-mill levy) and tuition and other funds are shown separately. As shown on the table, the growth in the current unrestricted budget has been funded more from tuition increases than state appropriated funds.
Montana University System Current Unrestricted Operating Funds - Educational Units Summary Detail of Funding
(in millions) Revenue Source State Appropration Tuition & Fees Scholarships & Fellowships All Other Total Budget FY 2000 $109.73 99.17 9.41 2.31 $220.62 FY 2008 $142.66 177.70 27.13 3.96 $351.45 FY 2010 $151.95 187.49 30.67 2.92 $373.02
* Data from the Office of the Comm is sion of Higher Education (Septem ber 2010)
What does the State Percent Share mean in the MUS?
The state percent share is that proportion of the current unrestricted operating fund (which supports all components of the educational mission) for the university educational unit campuses that are funded by state funds (general fund and six mill levy revenue). In 1988 the state percent share of the university educational units’ budget was 74 percent while in 2010 the state percent share was 41 percent. This percentage is important as part of the university system budget because historically (the 2007 session being a recent exception) the state percent share level from the current budget is used to drive state funding levels to support present law programs in the next budget. In the 2007 session, the legislature approved the Governor’s College Affordability Plan proposal that funded budget increases based in the proportion of Montana resident and Western Undergraduate Exchange (WUE) students to total enrollment (85%) and resulted in zero tuition rate increases for Montana students in FY 2008 and FY 2009.
LFD Mission Statement We are committed to enhancing the legislative process through understandable and objective fiscal policy analysis and information.
Average Annual Percent Change State Appropriation Tuition & Fees Scholarships & Fellowships All Other Total Budget 3.3% 6.6% 12.5% 2.4% 5.4%
“While the Montana Constitution grants governance authority to the Board of Regents, the power to appropriate state funds remains with the legislature…with this power comes authority to attach policy decisions and accountability measures to state funding.”
Source: Board of Regents Operating Budgets Legislative Fiscal Division State % Share Calculation
Primary Contact: Pam Joehler Room 110A, State Capitol Helena, MT 59620-1711 (406) 444-5387 E-mail: [email protected]
Organization and Governance
Section 20-25-201, MCA, defines the Montana University System (MUS) as: The University of Montana, with campuses in Missoula, Butte, Dillon, and Helena Montana State University, with campuses in Bozeman, Billings, Havre, and Great Falls For budgeting purposes, the term “university system” also includes the: Office of the Commissioner of Higher Education Board of Regents Agricultural Experiment Station Forest and Conservation Experiment Station Cooperative Extension Service Bureau of Mines and Geology Fire Services Training School Community Colleges (17-7-102(13), MCA) Although the Board of Regents is organizationally placed in the Executive Branch, the Montana Constitution grants the Board broad, autonomous governing authority over the MUS. Article X, section 9, of the Montana Constitution provides “the government and control of the MUS is vested in the Board of Regents, which shall have full power, responsibility, and authority to supervise, coordinate, manage, and control the... system.” The Board consists of seven members appointed by the Governor. The regents’ powers and duties are further described in 20-25-301, MCA.
Other fund types include current restricted (federal grants), current designated (service fees), current auxiliary (service operations such as dormitories), student loan funds, endowment funds, plant funds, and agency funds (fiduciary).
What Is the State’s Role in Funding the University System?
While the Montana Constitution grants governance authority to the Board of Regents, the power to appropriate state funds remains with the legislature. The MUS is funded through a combination of government money, in particular state general fund and revenue from the six-mill property tax levy, as well as federal program funds. Such funds must be appropriated by the legislature. With this “power of the purse” comes the authority to attach policy decisions and accountability measures to the funding. On the other hand, higher education primarily consists of the delivery of service to private individuals who pay for services in a contractual manner. So the MUS is also supported with “private revenue” for services that individuals contract for, including: tuition for courses, residence halls, food service, tickets for athletic and arts events, etc. Within this constitutional configuration, therefore, a tension exists between the autonomy that comes with governance authority and the power that comes from the appropriation of state funds. Through a series of legal decisions, this tension has been reconciled as follows: The Montana Legislature cannot do indirectly, through fiscal appropriation, what it is not permitted to do directly by the Constitution. In other words, appropriation of state funds cannot be used to blatantly drive MUS governance policy as governance is the constitutional role of the Board of Regents. Legislative appropriation power does not extend to private funds received by state government that are restricted by law, trust agreement, or contract, such as student tuition and the other fees listed above.
Legislative appropriation power does, however, allow the legislature to establish requirements of MUS compliance with audit, accounting and fiscal accountability measures. The Montana Legislature can establish conditions on the appropriated funds. If the MUS accepts the funds, it accepts the conditions.
For more information about this Constitutional structure and history, see The Structure of Higher Education in Montana: Meandering the Murky Line, Montana Legislative Services Division, Sept. 1999 memo available at: http://leg.mt.gov/content/publications/services/gal/ opinions/regents.pdf
Why Is General Fund So Important?
State general fund support is the second largest source of revenue for the MUS. General fund appropriations in House Bill 2 provide the vehicle with which the legislature may have a public policy impact upon the MUS. Finally, Montana Supreme Court decisions say that the Regents’ power to govern must be harmonized with the legislature’s power to appropriate, set public policy, and ensure accountability of state revenue and expenditures.
What Kinds of Funds Support the University System?
The MUS is funded from several sources, including the state general fund and statewide six-mill levy, tuition and fees, federal and private grants, service fees, service operations, and other sources. Using national accounting standards and state statute, the university system classifies its revenue and expenditures into various fund types. State funds appropriated for general operations and tuition are classified as “current unrestricted” funds.
How Is the State Appropriation Determined?
The legislature considers many factors to develop the MUS appropriation including: Projected student enrollment Base year actual expenditures and funding State funds available Legislative priorities Governor’s recommendation Board of Regents’ requests
How Many Students Are Enrolled?
The following table shows actual full-time resident and nonresident student enrollment for fiscal years 2000 to 2010 and projected enrollment through 2013. Resident enrollment has steadily increased over this period while nonresident enrollment has fluctuated, but reached a recent high-mark in FY 2010.
Montana University System Student FTE Enrollment Fiscal 2000 - Fiscal 2013
Fiscal Year FY 00 Actual FY 01 Actual FY 02 Actual FY 03 Actual FY 04 Actual FY 05 Actual FY 06 Actual FY 07 Actual FY 08 Actual FY 09 Actual FY 10 Actual FY 11 BOR Op Budget FY 12 MUS Est.* FY 13 MUS Est.* Resident Student FTE 24,605 24,851 25,566 26,226 26,828 26,322 26,422 26,263 26,279 26,740 28,398 28,526 28,883 29,102 Annual % Change 0.7% 1.0% 2.9% 2.6% 2.3% -1.9% 0.4% -0.6% 0.1% 1.8% 6.2% 0.5% 1.3% 0.8% Non-Resident Total Student FTE Student FTE 6,893 31,498 6,715 31,566 6,524 32,090 6,447 32,673 6,353 33,181 6,441 32,763 6,667 33,089 6,910 33,173 7,071 33,350 7,180 33,920 7,520 35,918 7,436 35,962 7,658 36,541 7,732 36,834 Resident as a % of Total 78.1% 78.7% 79.7% 80.3% 80.9% 80.3% 79.9% 79.2% 78.8% 78.8% 79.1% 79.3% 79.0% 79.0%
The Legislative Fiscal Division
Presents
FOCUS ON…
HIGHER EDUCATION FUNDING
October 2010 Fiscal Pocket Guide
How Does Tuition Fit in the Budget?
The Board of Regents is the sole authority in setting the tuition rates for the MUS. Tuition is not controlled or appropriated by the legislature. The following table shows the total current unrestricted budget for the Montana University System educational units for fiscal years 2000, 2008, and 2010. The state appropriated component (general fund and six-mill levy) and tuition and other funds are shown separately. As shown on the table, the growth in the current unrestricted budget has been funded more from tuition increases than state appropriated funds.
Montana University System Current Unrestricted Operating Funds - Educational Units Summary Detail of Funding
(in millions) Revenue Source State Appropration Tuition & Fees Scholarships & Fellowships All Other Total Budget FY 2000 $109.73 99.17 9.41 2.31 $220.62 FY 2008 $142.66 177.70 27.13 3.96 $351.45 FY 2010 $151.95 187.49 30.67 2.92 $373.02
* Data from the Office of the Comm is sion of Higher Education (Septem ber 2010)
What does the State Percent Share mean in the MUS?
The state percent share is that proportion of the current unrestricted operating fund (which supports all components of the educational mission) for the university educational unit campuses that are funded by state funds (general fund and six mill levy revenue). In 1988 the state percent share of the university educational units’ budget was 74 percent while in 2010 the state percent share was 41 percent. This percentage is important as part of the university system budget because historically (the 2007 session being a recent exception) the state percent share level from the current budget is used to drive state funding levels to support present law programs in the next budget. In the 2007 session, the legislature approved the Governor’s College Affordability Plan proposal that funded budget increases based in the proportion of Montana resident and Western Undergraduate Exchange (WUE) students to total enrollment (85%) and resulted in zero tuition rate increases for Montana students in FY 2008 and FY 2009.
LFD Mission Statement We are committed to enhancing the legislative process through understandable and objective fiscal policy analysis and information.
Average Annual Percent Change State Appropriation Tuition & Fees Scholarships & Fellowships All Other Total Budget 3.3% 6.6% 12.5% 2.4% 5.4%
“While the Montana Constitution grants governance authority to the Board of Regents, the power to appropriate state funds remains with the legislature…with this power comes authority to attach policy decisions and accountability measures to state funding.”
Source: Board of Regents Operating Budgets Legislative Fiscal Division State % Share Calculation
Primary Contact: Pam Joehler Room 110A, State Capitol Helena, MT 59620-1711 (406) 444-5387 E-mail: [email protected]
Organization and Governance
Section 20-25-201, MCA, defines the Montana University System (MUS) as: The University of Montana, with campuses in Missoula, Butte, Dillon, and Helena Montana State University, with campuses in Bozeman, Billings, Havre, and Great Falls For budgeting purposes, the term “university system” also includes the: Office of the Commissioner of Higher Education Board of Regents Agricultural Experiment Station Forest and Conservation Experiment Station Cooperative Extension Service Bureau of Mines and Geology Fire Services Training School Community Colleges (17-7-102(13), MCA) Although the Board of Regents is organizationally placed in the Executive Branch, the Montana Constitution grants the Board broad, autonomous governing authority over the MUS. Article X, section 9, of the Montana Constitution provides “the government and control of the MUS is vested in the Board of Regents, which shall have full power, responsibility, and authority to supervise, coordinate, manage, and control the... system.” The Board consists of seven members appointed by the Governor. The regents’ powers and duties are further described in 20-25-301, MCA.
Other fund types include current restricted (federal grants), current designated (service fees), current auxiliary (service operations such as dormitories), student loan funds, endowment funds, plant funds, and agency funds (fiduciary).
What Is the State’s Role in Funding the University System?
While the Montana Constitution grants governance authority to the Board of Regents, the power to appropriate state funds remains with the legislature. The MUS is funded through a combination of government money, in particular state general fund and revenue from the six-mill property tax levy, as well as federal program funds. Such funds must be appropriated by the legislature. With this “power of the purse” comes the authority to attach policy decisions and accountability measures to the funding. On the other hand, higher education primarily consists of the delivery of service to private individuals who pay for services in a contractual manner. So the MUS is also supported with “private revenue” for services that individuals contract for, including: tuition for courses, residence halls, food service, tickets for athletic and arts events, etc. Within this constitutional configuration, therefore, a tension exists between the autonomy that comes with governance authority and the power that comes from the appropriation of state funds. Through a series of legal decisions, this tension has been reconciled as follows: The Montana Legislature cannot do indirectly, through fiscal appropriation, what it is not permitted to do directly by the Constitution. In other words, appropriation of state funds cannot be used to blatantly drive MUS governance policy as governance is the constitutional role of the Board of Regents. Legislative appropriation power does not extend to private funds received by state government that are restricted by law, trust agreement, or contract, such as student tuition and the other fees listed above.
Legislative appropriation power does, however, allow the legislature to establish requirements of MUS compliance with audit, accounting and fiscal accountability measures. The Montana Legislature can establish conditions on the appropriated funds. If the MUS accepts the funds, it accepts the conditions.
For more information about this Constitutional structure and history, see The Structure of Higher Education in Montana: Meandering the Murky Line, Montana Legislative Services Division, Sept. 1999 memo available at: http://leg.mt.gov/content/publications/services/gal/ opinions/regents.pdf
Why Is General Fund So Important?
State general fund support is the second largest source of revenue for the MUS. General fund appropriations in House Bill 2 provide the vehicle with which the legislature may have a public policy impact upon the MUS. Finally, Montana Supreme Court decisions say that the Regents’ power to govern must be harmonized with the legislature’s power to appropriate, set public policy, and ensure accountability of state revenue and expenditures.
What Kinds of Funds Support the University System?
The MUS is funded from several sources, including the state general fund and statewide six-mill levy, tuition and fees, federal and private grants, service fees, service operations, and other sources. Using national accounting standards and state statute, the university system classifies its revenue and expenditures into various fund types. State funds appropriated for general operations and tuition are classified as “current unrestricted” funds.
How Is the State Appropriation Determined?
The legislature considers many factors to develop the MUS appropriation including: Projected student enrollment Base year actual expenditures and funding State funds available Legislative priorities Governor’s recommendation Board of Regents’ requests
