Guest View: Federal tax reform bill will harm college students

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Illinois college students and their families need a high-quality, affordable education now more than ever. Our private colleges and universities have worked hard to provide that quality education at an affordable — and increasingly competitive — price in recent years. But that progress faces a serious threat from Washington.

As the state has made historic funding cuts in the last decade, private campuses across Illinois have invested in students by controlling costs in many ways, seeking alternative ways to generate revenues to provide the high-quality education students need, and streamlining programs to provide more value for students’ investment.

These actions are in response to the needs of the students and families we serve. And in part, these actions address the call from lawmakers to slow down the increasing cost of higher education while still providing access to a college or university that best fits an individual student’s needs.

Now Congress, through its recently unveiled tax reform bill proposal, threatens to throw up additional roadblocks that threaten the financial stability of private nonprofit colleges and universities and their ability to serve students.

One ominous proposal would place a tax on private college endowments. The earnings from endowments, along with private fundraising and other institutional revenues, have long provided scholarships to students as well as base funding for academic programs. Cutting this revenue will decrease funding for needy students and increase the costs to offer programs. In Illinois alone, private colleges and universities annually contribute more than $1 billion in institutional aid, enabling tens of thousands of students to achieve a college degree. Taxing endowments makes little sense if our goal is to increase college participation.

Another part of the proposal would eliminate employer-provided education assistance, which provides much-needed assistance to working students by incentivizing employers to provide tuition assistance benefits. Most recipients of this benefit are non-traditional students trying to improve their skills and workplace mobility. Colleges, businesses and labor organizations all support this important benefit that allows employers to invest in their workforce, while allowing employees the ability to advance their education and experience.

If also enacted, the elimination of tax-exempt bonds for private colleges and universities could significantly raise the cost of capital projects, at a time when the need for infrastructure improvements and safety upgrades (many mandated by government) are greatly needed. This type of bond financing for nonprofits, which meets significant post-issuance disclosure and compliance requirements, is a proven tool with a decades-long record of success for providing vital public services and creating jobs. Low-cost access to capital helps keep private colleges and universities strong, enabling us to keep expenditures low so we can focus on the work we do for the public good and the students and families that we serve.

And there are other provisions that benefit students and institutions that are the target of new taxation. One of these include removing the student loan interest deduction, incredibly important as students start their careers and begin repaying student loans. Another is taxing employee tuition and dependent benefits, which help retain talented staff and would hurt the lowest-paid college employees the most.

A top goal of tax reform should be to support college students and the institutions they attend, not hurt them. Illinois private colleges and universities have a long commitment to providing educational services for the common good. As students succeed, so does our economy and state. Targeting private colleges and universities in this bill could have severe long term consequences, and further deters our national and state goals of having 60 percent of our adults holding some college credential by 2025. Congress should seek ways to encourage the American dream, not shatter it.

David W. Tretter is president of the Federation of Independent Illinois Colleges and Universities

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November 16, 2017 at 08:18PM

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Guest View: Federal tax reform bill will harm college students

In “State of the System,” SIU President Points to New Challenges, Opportunities

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SIU President Randy Dunn says there are challenges ahead – but he has big plans for the system.

In his annual “State of the System” address, Dunn outlined financial pressures that will continue to affect SIU, including the state budget.

“A new “Tier 3” hybrid pension plan, part of the deal that ended the budget impasse, needs to be written—and that has major implications for future recruitment and retention of highly talented faculty and staff.”

But Dunn says he’s not focusing on the fiscal hurdles – he’s forging ahead with a new plan he calls “Great Schools/SI,” an expansion of the education work SIU already provides across the region.

“SIUE’s East St. Louis Charter High School, the system’s role in helping to resurrect the regional P-20 Council for deep southern Illinois, preschool programs, the fact that SIUC serves as the university affiliate for the state’s K-12 leadership organizations and the rural schools association.”

Dunn says “Great Schools/SI” will be a collaboration helping to prep not only the next teachers, but also prepare area students for higher education and the workforce – and bolster programs that may need more support from SIU.

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October 18, 2017 at 01:17PM

In “State of the System,” SIU President Points to New Challenges, Opportunities

With Illinois budget deal secured, public universities still face challenges

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For the first time in more than two years, Illinois’ public universities can start the school year with the promise of state money from Springfield.

Illinois went 736 days without a budget when lawmakers overrode Gov. Bruce Rauner’s veto of a spending plan and tax hike July 6. State universities received a fraction of their typical state funding before the spigot was shut off in 2017 — spurring campus shutdowns, layoffs, program cuts, maintenance failures and construction delays along the way.

School leaders shared the same reaction: relief. But while the budget satisfies many short-term needs, many say they face a daunting challenge to undo the havoc that the impasse wreaked upon the reputation and fiscal stability of public higher education in Illinois.

“You don’t get one year’s funding and have people say, ‘Oh, Illinois is totally fixed now,’ ” said Rachel Lindsey, interim president of Chicago State University. “I don’t think it would be in our best interest to think of ourselves as out of the woods just yet.”

Illinois sent more than $1.2 billion to the state’s 12 public universities in 2015, the last spending plan before the impasse. In the budget-less years, two stopgap bills in 2016 provided just $996 million in state support for public colleges over two years.

The new budget gives public universities about $1.1 billion for 2017-18, according to Illinois Board of Higher Education figures. That’s about 10 percent less than what those schools received in 2015, but still more than some college leaders were expecting.

The budget “will provide the certainty higher education leaders and supporters have been calling for to start moving Illinois forward again,” the education board’s chairman, Tom Cross, wrote in a memo this week. “All sectors of the state’s higher education system will benefit.”

But university leaders cautioned that the deal does not fully resolve the financial problems that schools endured.

Schools went nearly the entire 2015-16 year without a dime from the state, then received between one-fifth to one-half of their typical funding in the first stopgap bill in April 2016, just weeks before the end of the fiscal year. The spending plan provides no other funding for that year, leaving schools to swallow the burden it created in their finances.

The University of Illinois, for example, will have to go forward with a $467 million hole in its operations.

“We are still advocating for the restoration for the (fiscal year) 2016 budget,” U. of I. President Tim Killeen said at a board meeting Thursday. “Obviously the chances of that happening are diminishing over time.”

And at Southern Illinois University in Carbondale, finances became so dire that the administration lent the campus dollars from the Edwardsville site to keep it running. President Randy Dunn said that kind of intra-system borrowing is no longer needed but Carbondale must continue with its plan to cut $19 million, which officials said includes eliminating dozens of staff and faculty.

Even with the additional money from Springfield, the university is in the hole $37.8 million for 2017.

The legislation is especially welcome for low-income students — those whose ability to attend college at all was put at risk because of underfunding of critical grants and scholarships. The deal boosts funding for Monetary Award Program grants by 10 percent: $401.3 million compared with $364.8 million from 2015, according to state data.

The bill also provides another $560.5 million to cover general operation costs for 2016-17. That, added with the second stopgap bill from June 2016, gives schools just over $1.2 billion — in line with a typical year of funding. MAP grants for last year, the costs of which some schools absorbed, are fully covered.

“It would be difficult to overstate the importance of this funding,” said Joseph King, spokesman for Northern Illinois University in DeKalb, where one-third of students receive MAP grants. “For them, knowing that MAP funding is guaranteed, without the caveat that they may someday be asked to pay it back, provides tremendous peace of mind and allows them to focus on their goal of earning a degree.”

Governors State University in University Park also covered MAP for its students during the impasse. About 1,200 Governors’ students received grants in 2015, comprising about 20 percent of its enrollment, according to the Illinois Student Assistance Commission.

Elaine Maimon, president of Governors State, said school officials were dreading how to address the issue if state funding still was not available to reimburse the university for MAP costs.

“We know that our students, many of them first-generation, that they just wouldn’t come to school,” Maimon said. “The financial issues were so oppressive to them. We did everything we could to say we will cover you and that’s a top priority.”

Lynne Baker, spokeswoman for the student assistance commission, which oversees several grants including MAP, agreed that fully funding the assistance programs is critical to keeping students enrolled.

“Truly it is the uncertainty that made it so incredibly difficult for students,” Baker said. “For the last two years, we’ve really turned financial aid on its head. We asked the very students who don’t have the funds to put forward the funds if their school couldn’t do it.”

Now, some money is already hitting the pipeline.

On Thursday, Illinois Comptroller Susana Mendoza released $327 million to pay 2016-17 MAP grants, according to a statement from her office. Another $36 million for MAP is going to community colleges.

Mendoza also said her office has started paying out $160 million for universities’ operational costs Thursday.

And with the money starting to flow, some cuts being considered for a third year of budget impasse now can be at least postponed.

Maimon said the board members had given her the authority to shut down Governors’ College of Education if money didn’t arrive in time. That is now off the table. Layoffs of about 180 full-time employees at Northeastern Illinois University have been paused, spokesman Michael Hines said.

Some university leaders said they are proceeding cautiously and delaying major moves until they know more precisely how much money for what is coming when.

“Because of future uncertainties and the far-reaching impact of the 700-plus day impasse, it is vital that we maintain Western’s ongoing fiscally conservative practices,” Western Illinois University President Jack Thomas wrote in a campus message.

Major credit agencies downgraded the ratings for nearly all the universities this summer, plunging several further into “junk” status. Poorer credit makes it more expensive to borrow for major projects.

The Higher Learning Commission, which oversees universities in 19 states, warned that schools unable to convincingly demonstrate financial health and provide quality academics could face sanctions.

State data show Illinois students are increasingly attending college in other Midwestern states. Some universities, like Indiana State University in Terra Haute, are targeting Illinoisans through special scholarships and reduced tuition.

“Those students who have decided to leave the state have already made that decision,” Northeastern Interim President Richard Helldobler said. “The rhetoric from a lot of our feeder schools has increased, and they’ve been very upfront about saying ‘We are encouraging students to go out of state.’ “

Considering how contentiously the budget came to fruition, school leaders said they must keep up their advocacy to avoid another potential impasse.

“It is important to keep that momentum going,” Illinois State University President Larry Dietz wrote in a campus message. “There may be a budget in place today, but it will take years of hard work to reverse the damage that has been done.”

drhodes@chicagotribune.com

Twitter @rhodes_dawn

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July 16, 2017 at 06:06AM

With Illinois budget deal secured, public universities still face challenges

University students detail pain of budget stalemate

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Illinois university students, professors and staff members pleaded with Illinois House members Thursday to get back to the business of funding state higher education, as legislators prepare to return to Springfield to try to break a historic gridlock over the state budget.

In detailed and emotional testimony in an hourslong hearing, public and private university students and employees told House Higher Education Appropriations Committee members that the nearly two years without regular state funding has driven them to the brink of financial failure, jeopardized their ability to complete their degrees, prematurely ended careers and threatened to shutter schools and programs.

Illinois has been without a budget since July 2015, and Illinois public colleges have not received any state funding since a stopgap bill in June 2016. The Monetary Assistance Program, which provides grants for low-income students, also has not been funded, forcing many schools to try to absorb the costs so students do not default on their tuition expenses.

“You are dismantling higher education in Illinois,” said Zaiga Thorson, a professor at Black Hawk College in Moline. “You are draining Illinois of one of its most valuable resources: its people.”

Deion Owens, a senior studying education at Roosevelt University in Chicago, said he has drained his savings account, switched from part-time to full-time work and moved to a cheaper apartment in a blighted neighborhood to be able to afford school, primarily because his $5,000 Golden Apple scholarship was not financed.

Golden Apple scholarships, like MAP grants, both receive state support through the Illinois Student Assistance Commission.

“People say to keep your eye on the prize, but it’s so hard when the state of Illinois keeps taking our glasses,” Owens said.

Amy Sticha, who studies biology at Northeastern Illinois University, said she lost two weeks’ pay from her part-time university job and 12 days of classes during two campuswide furloughs this spring. That lost classroom time is particularly problematic for science majors like her, who require a specific number of hours of lab work to complete their courses and seek jobs in the field.

“Morale is very, very low. Everyone is stressed, everyone is anxious, everyone I know has a backup plan out of state in Wisconsin or Indiana or Michigan,” Sticha said. “No one I know really has faith. No one thinks this is going to be resolved in a way where we aren’t thrown to the side.”

Three Chicago State University students discussed how in addition to the financial and academic challenges, frustration is mounting from a sense of students and universities being used as political pawns.

“The cynicism is real,” said Charles Preston, who graduated in May and who frequently helped organize student and community demonstrations about the budget debate. “We’ve reached out to politicians who laughed in our faces. We don’t feel like we’re politically represented or trust (that) our voices are being heard.”

Faculty and staff members from the schools also testified to the growing damage.

Kimberly Archer, a music professor and head of the faculty association at Southern Illinois University at Edwardsville, discussed how the lack of a budget means health insurance provider reimbursements are not being made.

SIUE is “hemorrhaging” faculty, Archer said, because they can no longer rely on that essential benefit or use their salaries to fill the gaps.

The state legislature ended its regular session May 31 without sending a budget to Gov. Bruce Rauner’s desk. The governor on Thursday called back assembly members for special session for the final 10 days of June amid mounting pressure to end the stalemate.

The fiscal year ends June 30.

“We eat and starve based on your decision,” Illinois State University senior Tia Dunlap said.

drhodes@chicagotribune.com

Twitter @rhodes_dawn

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June 15, 2017 at 07:31PM

University students detail pain of budget stalemate

University students detail pain of budget stalemate

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Illinois university students, professors and staff members pleaded with Illinois House members Thursday to get back to the business of funding state higher education, as legislators prepare to return to Springfield to try to break a historic gridlock over the state budget.

In detailed and emotional testimony in an hourslong hearing, public and private university students and employees told House Higher Education Appropriations Committee members that the nearly two years without regular state funding has driven them to the brink of financial failure, jeopardized their ability to complete their degrees, prematurely ended careers and threatened to shutter schools and programs.

Illinois has been without a budget since July 2015, and Illinois public colleges have not received any state funding since a stopgap bill in June 2016. The Monetary Assistance Program, which provides grants for low-income students, also has not been funded, forcing many schools to try to absorb the costs so students do not default on their tuition expenses.

“You are dismantling higher education in Illinois,” said Zaiga Thorson, a professor at Black Hawk College in Moline. “You are draining Illinois of one of its most valuable resources: its people.”

Deion Owens, a senior studying education at Roosevelt University in Chicago, said he has drained his savings account, switched from part-time to full-time work and moved to a cheaper apartment in a blighted neighborhood to be able to afford school, primarily because his $5,000 Golden Apple scholarship was not financed.

Golden Apple scholarships, like MAP grants, both receive state support through the Illinois Student Assistance Commission.

“People say to keep your eye on the prize, but it’s so hard when the state of Illinois keeps taking our glasses,” Owens said.

Amy Sticha, who studies biology at Northeastern Illinois University, said she lost two weeks’ pay from her part-time university job and 12 days of classes during two campuswide furloughs this spring. That lost classroom time is particularly problematic for science majors like her, who require a specific number of hours of lab work to complete their courses and seek jobs in the field.

“Morale is very, very low. Everyone is stressed, everyone is anxious, everyone I know has a backup plan out of state in Wisconsin or Indiana or Michigan,” Sticha said. “No one I know really has faith. No one thinks this is going to be resolved in a way where we aren’t thrown to the side.”

Three Chicago State University students discussed how in addition to the financial and academic challenges, frustration is mounting from a sense of students and universities being used as political pawns.

“The cynicism is real,” said Charles Preston, who graduated in May and who frequently helped organize student and community demonstrations about the budget debate. “We’ve reached out to politicians who laughed in our faces. We don’t feel like we’re politically represented or trust (that) our voices are being heard.”

Faculty and staff members from the schools also testified to the growing damage.

Kimberly Archer, a music professor and head of the faculty association at Southern Illinois University at Edwardsville, discussed how the lack of a budget means health insurance provider reimbursements are not being made.

SIUE is “hemorrhaging” faculty, Archer said, because they can no longer rely on that essential benefit or use their salaries to fill the gaps.

The state legislature ended its regular session May 31 without sending a budget to Gov. Bruce Rauner’s desk. The governor on Thursday called back assembly members for special session for the final 10 days of June amid mounting pressure to end the stalemate.

The fiscal year ends June 30.

“We eat and starve based on your decision,” Illinois State University senior Tia Dunlap said.

drhodes@chicagotribune.com

Twitter @rhodes_dawn

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June 15, 2017 at 07:31PM

University students detail pain of budget stalemate

NIU President Doug Baker To Leave Office June 30

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Northern Illinois University President Doug Baker announced at the beginning of today’s Board of Trustees meeting that he will leave the university at the end of the month. The announcement comes in the wake of a recently released report by the Illinois Office of the Executive Inspector General. It found that Baker’s administration improperly classified several new hires as "affiliate employees," a category meant for part-time, short-term workers. All the individuals involved worked full-time, in circumvention of state code. The report specifically stated that Baker "mismanaged" the university during that process. In a campus update released this morning, Baker says that, although his end-of-term evaluation was proceeding in a "positive manner," he agreed with Board Chair John Butler that the OEIG report was a "significant distraction." The Board will consider a transition agreement later today, and will release details after closed session.

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June 15, 2017 at 09:34AM

NIU President Doug Baker To Leave Office June 30

At Illinois’ Public Universities, State’s Budget Mess Tracked In Lost Jobs

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There are many ways to track the toll of the state’s nearly two-year-old budget standoff. On the campuses of Illinois’ public universities, one is the number of jobs cut.
Since the state last had a budget, in 2015, those dozen campuses have cut their payrolls by about 2,400 through layoffs and attrition.
No school has been hit harder than Eastern Illinois University in Charleston.
“We’ve cut about 440 positions from the university,” said Paul McCann, Eastern’s vice president of business affairs.
He says some employees now have to do more than one job.
While the state has provided partial funding to it spublic universities, all have had to cut back.
At Western Illinois University in Macomb, 28 people lost jobs to permanent layoffs and another 182 positions have been eliminated, spokeswoman Darcie Shinberger said.
Southern Illinois University in Carbondale has laid off 86 people and cut another 313 positions, Spokeswoman Rae Goldsmith said. Many are maintenance-related.
“What you’re likely to see there, behind the scenes, it’s going to take longer to get things done _ if something’s broken, if something needs to be fixed,” Goldsmith said.
Only Illinois State University and the University of Illinois have not laid off employees. But they have about 500 unfilled jobs between them.
Beyond the four-year schools, the state’s community colleges have been hard-hit by the lack of a budget, too. While the Illinois Community College Board does not currently have an exact count of jobs lost at the 48 schools it oversees, it has collected anecdotes from community colleges that account for about 280 jobs cuts, said Matt Berry, the board’s legislative and external affairs liaison.

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June 12, 2017 at 10:00AM

At Illinois’ Public Universities, State’s Budget Mess Tracked In Lost Jobs