Monday, January 11th, 2016
Leaders from across our state are anticipating Gov. Ducey's State of the State Address later today, especially in a year where Arizona's fiscal health is improving. For our part, the governor has hinted that he will "turn the trend line" for higher education.
Investing in our public universities is the sure path to economic vitality and personal success for our state and its citizens. Reversing an era of defunding our institutions will provide the educated workforce for Arizona's future when the majority of jobs are based on knowledge - work that requires post-secondary education. An ongoing, permanent commitment to public higher education in our state requires our state's elected leaders to prioritize access to higher education for all Arizona residents.
The good news is that our state is now positioned to reinvest in students. Arizona's economy is improving with 2016 on track to be the best year yet in our state's continued recovery, according to forecast reports by university economists. Recent data includes gains in jobs, wages, consumer spending and building permits for single-family homes.
Last year, state revenue growth far exceeded projections. This year continues that trend. Legislative budgets originally forecast the FY 2016 general fund ending balance at zero dollars. Their most recent forecasts now put that balance at $555 million, with at least $218 million of that as on-going revenue. Further, in November alone, Arizona's general fund revenues were up $84 million over the enacted budget, suggesting the budget picture may even be brighter.
Understanding the state has many fiscal commitments to consider, all indicators point toward the state being able to afford to incorporate our funding model in the FY 2017 budget.
Make no mistake - this is not a sales pitch.
It's my fundamental belief that our universities must remain healthy and viable for future generations as our state constitution intended.
Recently, I was included in The Arizona Republic's "16 Arizonans to Watch in 2016," an illustrative roster of pivotal leaders who are united in their commitment to the well-being of our state and our citizens. I thank each of them for their hard work. For my part, it was stated that I have an important but difficult job of selling lawmakers on university funding.
Indeed! I deliberately took my role as president of the Arizona Board of Regents to advance the sustainability of our university system because the truth is, these institutions are central to economic vitality and growth for our state. Funding our universities is a crucial message I share not only with lawmakers, but with everyone I talk to.
The Nobel Prize winning economist Milton Friedman aptly stated, "Universities exist to transmit knowledge and understanding of ideas and values to students, not to provide entertainment for spectators or employment for athletes." Our universities drive our state's economy by delivering high-quality education for Arizona residents and learners from around the world.
Today, our skilled workforce is mostly homegrown, reversing a trend of the past where most talent came to Arizona from other states. Within two years, two-thirds of jobs in Arizona will require some post-secondary education. Thousands of baby boomers are retiring over the next 10 years, and they will need to be replaced with new talent.
A better educated citizenry means more tax revenue and reduced expenses for incarceration and social services.
Higher education brings greater earning potential for individuals. Over the course of a lifetime, it's estimated that an individual with a bachelor's degree will earn $1 million more than they would have with a high-school diploma alone. While college may not be right for everyone, it is still one of the best guarantees of personal success.
Public higher education allows all citizens to advance their knowledge and personal liberty which is central to our democracy. Simply put, a college degree or certificate remains Arizona's most powerful tool for economic development and personal advancement.
That's why the Arizona Board of Regents and our public universities have proposed a new funding model and strategic plan that puts Arizona resident students at the center. The model proposes that state dollars be allocated to squarely support Arizona resident students, upending the model of performance funding. While performance funding is not the core of our new funding model, it is important to share that we have significantly enhanced the accountability, performance and transparency of our institutions over the past few years with the introduction of operational, financial and quality reviews. Our performance metrics also provide a transparent measure of growth in key outcomes for the state.
Our new model requests that over time, the state increase its commitment to resident students to 50 percent. Currently, the state funds 34 percent of a resident student's cost of education, down from a high of 88 percent in 1998.
I look forward to working with Gov. Ducey and our Legislature, on behalf of Arizona's students and families, to forge the path together toward greater sustainability for the future of our public universities.
We can turn the trend line. We must.