Wednesday, June 14th, 2017
By Eileen Klein
With the conclusion of the recent legislative session, Arizona's public universities celebrated the most significant influx of state financial support in recent memory.
Specifically, the state of Arizona's 25-year commitment of $27 million annually to fund capital infrastructure will generate nearly $1 billion to invest in new university buildings, research facilities and overdue repairs and refurbishments. We salute Gov. Doug Ducey and the bipartisan coalition of legislators who made it happen.
Those of us who have been in the policy mix a long time noticed something different this year. For the first time since I can remember, advocates for public K-12 education openly opposed higher education funding. These weren't rogue factions; they were longtime university supporters and respected voices who argued - despite a decade of reductions in state aid to universities - K-12's needs were simply more urgent and of higher priority than those of the universities.
Nobody disputes K-12 education is the state's top budget priority. Look at the numbers: In 2007, K-12 expenditures represented 39 percent of the state general fund. Ten years later, K-12 is still the state's single largest line item, at 42 percent of the general fund.
So, why the new angst between advocates of K-12 and higher education?
For starters, at $9.6 billion, the state general fund remains about the same size as it was in 2007.
During that time, Arizona added more than a half-million new state residents. That means more people requiring more state services. Our correctional system added 7,000 inmates (a 19 percent increase); 800,000 additional enrollees joined our Medicaid program (76 percent increase); and Arizona's K-12 population grew by 67,000 students (7 percent increase). Of course, higher education has also grown, with Arizona's three public universities adding 48,000 students (43 percent increase).
Amid all of this escalating demand for state services, the overall general fund has not kept pace and has actually become a much smaller slice of total state spending. That's because billions of dollars flow through state coffers each year, increasing total state spending. These dollars are mostly dedicated for specific items such as health care and transportation and often require growing levels of matching general funds. In 2007, the general fund comprised 38 percent of all state spending. Today, the general fund represents just a quarter of the total state budget.
What this means is the federal government has in many ways become the dominant player in Arizona's state budget process. You can see it in the final product. In 2007, K-12 and health care (i.e., Medicaid and public health) were the top budget priorities on a percentage basis - health care at 28 percent of the budget and K-12 at 22 percent.
Just a decade later, health care now accounts for 33 percent of the total budget; K-12 has shrunk to just 17 percent. Even if you combine K-12 and higher education, they still represent a smaller portion of the total state budget (31 percent) than health care alone.
Given these seismic fiscal shifts, it's understandable why every dollar is so precious - and how the appropriations process is beginning to pit "friends" against one another. As the demand for state services grows and as the federal government takes over more and more of the state's spending agenda, the demand for general fund dollars will only become more intense. At the same time, our growing state and flourishing economy will continue to demand an even more highly educated workforce.
At a time like this, it is critical that public education advocates view K-12 and higher education for what they are - consistent, essential ingredients of an educated populace and strong economy. This is not an "either/or" situation.
More unity, not less, among Arizona's business, community and education leaders, especially those who have stood for health care accessibility, is what will be needed to ensure Arizona students have a winning opportunity for a quality and affordable public education - at every level.