U of I’s capital plan will focus on facilities


CHAMPAIGN, Ill. (AP) — Although the University of Illinois has invested more than $1.2 billion in classrooms, residence halls and athletic venues since 2013, the school will put a renewed focus on facilities across its three campuses.

University officials say it’s time for a renewed focus on facilities. They say they hope to use the university’s borrowing power to fund key projects — including the Discovery Partners Institute in Chicago

With no state budget for the past decade, the university had to pay for more than half of its building projects through operating funds. The state covered about 7 percent.

The News-Gazette in Champaign reports university trustee Donald Edwards says that lack of state funding, coupled with an estimated $2 billion maintenance backlog, demands a long-term approach to addressing concerns about the school’s facilities.

Copyright 2018 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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January 21, 2018 at 01:09PM

U of I’s capital plan will focus on facilities

Study Shows Students Leaving the State


Nearly every other high school graduate in Illinois who went to a four-year university chose to do so outside the state in 2016.

A new report from the Illinois Board of Higher Education says that the number of Illinois residents enrolled in a local college is continually dropping and the number of students going to school in other states has been growing for more than a decade. In 2016, almost half of the local high school graduates that planned to attend a four-year school did so out of state. The report shows that they’re primarily just crossing the borders to neighboring state schools.

Board chairman Al Bowman said the decade-long trend is troubling. He thinks recent dips in enrollment are due to other universities out-recruiting Illinois’ schools on their home turf.

Click here for summary

“The schools will collectively have to do a better job of marketing their products,” Bowman said.

Education analyst Preston Cooper with the American Enterprise Institute said the cost of administration often drives up in-state tuition, lessening the value of the local discount.

“It’s definitely an area where schools might be able to cut back if they’re looking to rein in expenditures rather than raise tuition,” he said.

Bowman said a recent IBHE study showed students often pay more in out-of-state tuition and fees than if they had attended a local university.

The University of Illinois is the third most expensive school in the Big 10 conference behind private Northwestern and Penn State. The cheapest is the University of Iowa.

The top out-of-state school for Illinoisans in 2016: the University of Iowa.

Some schools are getting the hint. The University of Illinois confirmed Thursday morning that it would once again keep its tuition rates at the same level as the previous year’s levels. Illinois State University froze its tuition rates last year. Both have seen enrollment increases in recent years, Bowman says.

Illinois’ budget impasse definitely didn’t help attendance at Illinois’ public universities, Bowman said, but the trends extend far beyond 2015, when the impasse began.

The college graduate brain drain is troubling for politicians and school officials alike. College students are statistically more likely to set roots where they went to school, rather than move back home once they graduate. On a mass scale, this exasperates Illinois’ ongoing exodus of population that is now in its fifth consecutive year of lower headcounts.

Also, fewer students inevitably means less revenue for the universities that have become increasingly reliant on tuition for operating expenses. The combination of fewer new freshmen and increasing operation costs creates a vicious cycle of financial trouble for the institutions.

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January 21, 2018 at 12:08AM

Study Shows Students Leaving the State

Illinois treasurer cites private tuition restriction on college savings plans


SPRINGFIELD — Illinois families with Bright Start or Bright Directions college savings plans will not get a break on their state taxes if they use those accounts to pay for private K-12 tuition, Treasurer Mike Frerichs said Thursday.

And if they try to claim that deduction, they could potentially face a tax penalty from the state, he further warned.

The new federal tax law includes a provision allowing families with so-called 529 college savings plans, originally only for higher education expenses like tuition, fees and books, to use those tax-deductible funds for private K-12 tuition starting this year.

“Our analysis concludes that families who use Bright Start or Bright Directions money on elementary or high school expenses and then cite those expenditures when seeking tax relief will be in conflict with state law and could incur tax penalties if audited by state authorities,” Frerichs said.

The Illinois Department of Revenue concurred with the treasurer’s analysis, saying “the Illinois plans only allow expenditures on post-secondary education without penalty,” and that “In order to expand the definition of qualified expenditures, section 16.5 of the State Treasurer Act would need to be amended.”

The idea behind Illinois’ 529 savings programs, Bright State and Bright Directions, is to incentivize state taxpayers to save money for themselves or loved ones to attend college. The plans have been popular as they are not subject to federal income taxes and contributions are tax-deductible up to $10,000 for an individual or $20,000 for a married couple on state income taxes. And when it comes time for college, withdrawals from these accounts are exempt from state and federal taxes.

According to Frerichs, more than 450,000 accounts are open in Illinois, with about $9 billion invested in them.

“The whole idea on the state tax deduction was to incentivize saving for college,” Frerichs said. “It was not to incentivize private education.”

Though Illinois residents with plans will be able to use them for private K-12 tuition, they will have to pay the regular 4.95 state income tax rate on that cash. But, many, namely the wealthy, still stand to benefit from escaping federal taxes.

“Anytime you put a benefit in the code, the wealthy most likely will use it more aggressively unless the benefit is phased out at higher income levels — as is the case with many benefits put in the tax law,” said DePaul University professor Ron Marcuson, a tax expert. “I have not analyzed all aspects of Section 529 plans but it does not appear the benefit is phased out as the taxpayer’s income increases.”

However, Frerichs is worried that the confusion caused by conflicting state and federal policies will lead policyholders to write off that expense as a state tax deduction.

The Democratic treasurer said such a write-off, in addition to violating Illinois tax code, is in conflict with the spirit of the program, to save money long-term for college. Instead, Frerichs said the new federal provision opens up opportunities he likened to money laundering.

“Now you could see someone who’s already sending their kid to private school, has a $10,000 tuition bill; instead of giving $10,000 directly to the school, they can put it into a 529 account and then next day, write a check from their 529 account to a school,” Frerichs said. “They’ve not actually saved any money and they didn’t invest in it, they didn’t earn any interest off it. It’s just basically money laundering, it’s a pass-through for tax avoidance.”

If this were to occur, Frerichs said it would could have a negative impact on tax revenue for the state.

“There’s uncertainty of what’s going to happen if they write a check,” Frerichs said. “We want them to know that there are potential penalties out there for doing this, but our hope also is that the General Assembly and the governor will provide some clarity on what they would like.”




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January 18, 2018 at 07:09PM

Illinois treasurer cites private tuition restriction on college savings plans

University of Illinois freezes in-state tuition for fourth year


University of Illinois board members approved a fourth consecutive base tuition freeze for incoming in-state students, a move partially aimed at attracting more Illinoisans to the system’s three campuses.

Trustees voted unanimously Thursday morning to keep base tuition rates the same for Illinois residents who enroll as undergraduates at Urbana-Champaign, Chicago or Springfield in the 2018-19 school year.

University President Timothy Killeen announced this month that he would propose fixing the base tuition for the fourth time. The last time the university locked tuition rates for this long was from 1974 to 1977.

Illinois residents this fall will pay $12,036 a year at Urbana-Champaign, $10,584 at Chicago and $9,405 in Springfield. Those are the same base rates paid by in-state students enrolled each year since 2014. The total price of attendance is more than double that after adding in fees, and room and board.

While base tuition remains the same, there will be higher rates for several categories of fees and room and board this year. Students in prominent programs like engineering and business will also continue to pay higher tuition.

Board Chairman Timothy Koritz in supporting the freeze pointed to recent data confirming that Illinois is continuing to lose its homegrown students to other states for college.

Statistics from the Illinois Board of Higher Education and the National Center of Education Statistics show more than 19,000 Illinois residents left the state to attend college in fall 2016, the most recent year available. Only New Jersey loses more of its students to other states.

According to the state board, Iowa, Indiana and Wisconsin universities each enrolled more than 4,000 Illinois students in 2016. Illinoisans comprised one-third of all the non-resident students enrolling in Iowa and Wisconsin schools that year, and about one-fourth of the influx to Indiana universities.

“We need to make it a priority to reverse this trend,” Koritz said.

Illinois’ Truth In Tuition law requires universities to keep tuition rates the same for four years but schools can increase other costs of attendance.

Fees at Urbana-Champaign will increase by $20, to $3,058 per year. Non-resident and international student tuition will go up by 1.6 percent. Room and board will remain the same.

There also will be a per-semester increase for international students in the College of Liberal Arts & Sciences for the first time this year. Those students will add $750 to their tuition each term starting in the fall.

Killeen said money generated from that will help fund programs and scholarships for first-generation, underrepresented and need-based Illinois students.

Fees at the Chicago campus will go up $14, to $3,146 a year. Base tuition will rise 1.4 percent to 1.5 percent for out-of-state students and 1.6 percent for international students. Standard room and board charges will increase 1 percent, to $11,070 per year.

Annual fees at the Springfield campus are to increase $200, to $2,426, starting in the spring. The change incorporates a student-approved charge to help pay for a new student union. Tuition rates for non-resident freshman students and the price for the standard housing and meal plan will not change.

Barbara Wilson, vice president for academic affairs, said the tuition freeze means University of Illinois schools compare favorably to other Big Ten and peer institutions that have raised rates by higher percentages in the last few years. Wilson also said University of Illinois enrolls a higher percentage of in-state students than similar schools.

But even with the tuition freeze, all three University of Illinois institutions post some of the highest rates for tuition and fees compared to schools of similar size and prestige. Urbana-Champaign’s rates for first-time, full-time undergraduates are the second highest among schools that include University of Michigan, University of Wisconsin and several schools in the University of California system, Wilson said.

Trustee Donald Edwards called on university administration to explore why University of Illinois is consistently pricier than its competitors.

“We remain high in terms of tuition but we receive about the average of our operating funds from the state versus our peers,” Edwards said. “We’re headed in the right direction but we have a lot of work to do.”

In other business, trustees re-elected Koritz to serve as chairman of the board. Koritz assumed the top seat on the board for the first time last year.




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January 18, 2018 at 02:30PM

University of Illinois freezes in-state tuition for fourth year

Tax bill to impact higher education: Freeman talks NIU’s financial future


President Donald Trump speaks to reporters Oct. 13 on the South Lawn of the White House in Washington 

Associated Press

DeKALB — Acting President Lisa Freeman released a statement on Tuesday informing students of the impact of a Tax recently passed bill by the Senate.

The Tax Cut and Reform Bill (H.R. 1) was passed by a Senate vote of 51-48 on Dec. 19, signed by President Donald Trump Dec. 22 and became effective Jan. 1.

Freeman said university officials tried to inform lawmakers as they drafted the bill and influence their decisions, along with many other universities across Illinois and the rest of the country.

“NIU worked closely with other universities across Illinois and the nation to engage and inform legislators as they crafted this legislation during November and December 2017,” Freeman said in her Jan. 16 statement.

The tax code advances goals of “encouraging saving for higher education, helping students and families pay for college, and assisting with the repayment of student loans,” according to the American Council on Education. Freeman said in her statement that reaching out to lawmakers helped them understand NIU’s mission of helping students and families plan and pay for college.

“Thanks to these efforts, the final law does not eliminate a number of threatened provisions from current law that enhance the affordability of higher education for students and families,” Freeman said.

A limit on state and local tax deductions “may result in decreased state funding for public higher education institutions,” according to the American Council on Education website.

“The new limit on individual state and local income tax deductions could further complicate the state’s investment in public higher education,” Freeman said.

Freeman also said a reduction in tax incentives for donations to charity means giving up gifted money used for scholarships, research and athletics.

Freeman said there will be a period of time where the university will need to evaluate the scope of the impact this has on the university’s future.

“The full magnitude of this legislation’s impact on the university, students and their families will come into sharper focus as the details of the law are analyzed in the coming weeks and months,” Freeman said. “As always, NIU is committed to ensuring that an outstanding, affordable public education at NIU remains within reach of all Illinoisans.”

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January 18, 2018 at 06:57AM

Tax bill to impact higher education: Freeman talks NIU’s financial future

Illinois Legislature Needs to Address Terrible Financial Condition


State’s financial health is worst in the union and getting worse.

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January 15, 2018 at 03:36PM

Illinois Legislature Needs to Address Terrible Financial Condition

Illinois’ higher education leaders at odds over proposed budget


Seeking state money for higher education in Illinois used to be somewhat routine.

Colleges, universities and education agencies sent wish lists to the Illinois Board of Higher Education, whose members crunched the numbers and presented them to state legislators. Lawmakers, in turn, provided the funds — usually a sizable chunk of income for the state’s public institutions.

That was before the two-year budget impasse threw that ritual off-kilter. Schools and the state board twice went through the formality of requesting funding from Springfield only to see their funding dissipate during the stalemate.

Now, state education officials are discovering that getting back to normal isn’t so easy.

A rift has emerged as education leaders debate how aggressively to push lawmakers for state aid. At the heart of the issue is how to finance the state’s public universities following two years of almost non-existent state funding.

Presidents of the state’s nine public universities wrote a letter openly opposing the budget that the state higher education board presented at its meeting in December. In unusually blunt terms, the presidents told the board its request to state lawmakers was too conservative and would “place further burdens on public universities” after “two years of financial calamity.”

“The divestment in Illinois public higher education must stop now,” the letter said. “The continued lack of support threatens to further erode confidence in the state and its institutions of higher learning.”

Budget negotiations, some feel, offer a chance for the higher education community to promote its institutions and push lawmakers to make them a fiscal priority.

Some board members supported the presidents’ demand to seek more state dollars while others, including Chairman Tom Cross, feared pressing legislators for more money out of a depleted government may seem tone-deaf and could backfire.

“I think this board needs to maintain its credibility and you lose it if you’re not cognizant of the financial situation of the state of Illinois,” Cross said at the meeting. “We can advocate for universities and also be responsible in your ask.”

The board delayed a planned vote on the budget and discussions continue.

The board’s funding proposal seeks about $3.47 billion for public universities, community colleges, grants and various higher education divisions for 2018-19. It would be a $254 million increase over current funding, according to the board report.

The share for public universities would be a little more than $1.1 billion, a $24.1 million increase from this year.

That isn’t enough for the school presidents. They want the board to request $1.2 billion from the state, matching the allocation for public universities in 2015, the last year there was a budget before the impasse began.

This year’s state allocation is 10 percent less than what schools received in 2015. Righting the ship for public universities should mean returning to the days before the deep cuts from the impasse took hold, the presidents argue.

“The two years of impasse really damaged the image of higher education in the state of Illinois,” Illinois State University President Larry Dietz said. “We’re trying to get back to the image that will keep students in the state and pursue their education at Illinois institutions. The way to do that is to provide stable funding and appropriate funding, and we thought (fiscal year 2015) was the last time that did that.”

Randy Dunn, president of Southern Illinois University with campuses in Carbondale and Edwardsville, said one goal of the letter was to show that presidents would more loudly advocate for their schools, just as they called on board members to do.

“I think the presidents through the budget crisis spent maybe too long sitting on our hands, not speaking truth to power about the damage the budget crisis was doing to our institutions,” Dunn said. “I implicate myself in that. I think collectively we don’t want to be seen as sitting on the sidelines as we go into this budget negotiation.”

Elaine Maimon, president of Governors State University in University Park, agreed.

“I think it’s hard for the general public to really understand why it is important to invest in public universities,” Maimon said. “So it was really a sense of mission that we had: In every way that we can, we needed to try to get this message out. It isn’t for us; it’s for students and it’s for the state of Illinois.”

Some board members seemed to accede. Cherilyn Murer said she felt Illinois needed to emulate other states that give stronger political and financial support for its public universities.

“The fact is that higher education has to become a significant priority,” said Murer, of Homer Glen. “The legislature is going to do whatever they choose to do and they will cut to whatever level they wish to cut.”

Christine Wiseman also indicated support for the presidents’ position.

“I don’t think we lose credibility by advocating on a principled basis what is necessary for our institutions to do the job they have to do,” said Wiseman, of Palos Heights.

Others shared Cross’s concerns about the viability of state finances. IBHE Executive Director Al Bowman said getting a $254 million increase is far from certain. Some also suggested the board will have to demonstrate how more money will produce better academic and financial performance at its schools.

“If we’re looking for consistency, are we also going to ensure to the state that enrollments will rise, bond ratings will go up, there will be more affordability and there will be more degree completion?” said Sherry Eagle, of Chicago. “The time has passed for asking for dollars and this is what you’re going to get. Assurances are hard to make right now, but so is giving money.”

The financial deficiencies of Illinois public higher education go far beyond the $100 million more the universities want.

The tab on backlogged maintenance on university buildings runs about $5.5 billion, said Nyle Robinson, the board’s deputy director of fiscal affairs and budgeting. Replacing all the state-owned education facilities would cost $26.3 billion, according to a board report.

The proposed budget seeks $1.51 billion in capital investment, as well as $20 million for projects that pose extreme risks to safety and operations if not fixed. The General Assembly has not approved any new capital funding since 2011. Even if the state legislature approved that kind of money, Cross said doling out the funds would be akin to deciding between a school with failing pipes or a school with broken pipes.

“Every year without a capital bill, this just gets worse and worse,” Cross said. “We’re trying to address the most urgent needs on this list.”

The board will convene a special meeting over the next two to three weeks to revisit the budget issue, Cross said. The two sides diverge on strategy and may not concur with the final numbers but both presidents and board members share the same clear goal: avoid another budget crisis at all costs.

“There should be an absolute principle from both parties that there will not be another budget impasse,” said Maimon of Governors State. “If there’s another budget impasse, the reputation of Illinois — I don’t know where it’s going to go.”


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January 15, 2018 at 06:51AM

Illinois’ higher education leaders at odds over proposed budget