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| 09-20-2004 | Previous edition: 09-17-2004 |
        
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Printer-friendly version Indiana defers higher education paymentsBy Brent ForguesCity Editor After three years of deferring payments to state universities, Indiana owes nearly $100 million for higher education. Kevin Green, director of state relations for Purdue’s Office of Governmental Relations, said the state makes 12 monthly payments to universities every year; however, in 2002, Indiana rolled over June’s payment to the next fiscal year due to budget difficulties. As of 2004, the state has still not paid, and as state appropriations increase each year, so does the payment to universities. Green said Indiana deferred $95 million in appropriated funds for state universities in 2002, which has grown to $99 million as of 2004. In 2002, $26.8 million of the $95 million belonged to Purdue, and as of 2004 it has grown to $27.2 million. Those payments have already been deferred to 2005, and if the state rolls over the payment into 2006, Green said the money due to state universities will grow to $102.2 million. "We’re approaching over $100 million, which is owed to the universities for payment they never received," he said. "It’s obviously of great concern to us." Green said the University has had to draw money from its reserves to accommodate for each rollover and a sizable amount of money has also been lost from the interest that Purdue’s money could have made in the bank. "It’s kind of like a double hit," he said. Although significant funds still remain in Purdue’s reserves to make up for the money lost each year, he said the amount of support that comes from the state can affect tuition costs in the long term. "If you plot this over time, there is a high correlation between strong state support and low fees, which means kind of intuitively there is an opposite correlation," he said. Green said he hopes he doesn’t have to consider what Purdue will do if Indiana "reneges on its commitment" to state universities if the payment grows too large and the state cannot pay it. If the $600 million owed to local schools across the state is taken into consideration with the $100 million for higher education, in addition to the state’s deficit of $800 million, Green said Indiana will need about $1.5 billion just to get even. "We have no indication about at which point in time they will pay us back," he said. State Rep. Sheila Klinker, D-District 27, said the furloughed money will be addressed in legislature this year, but paying off $99 million at once would be unlikely. "You don’t just tell someone that you want $100 million," she said. Klinker said she would look at figures like $35 or $75 million and make up the difference by reexamining the issue on a yearly basis. Her opponent said the problem won’t be addressed soon enough. Jeff Crites, Republican candidate for state representative, said one of the first things he will do is draft a bill to make it illegal to furlough money to state universities. "It’s important to make sure that educators have their money and furloughing the funds like they have is making a promise and not keeping it," he said. Terry Strueh, vice president of governmental relations of Purdue’s Office of Governmental Relations, said rollovers are not uncommon and happen about once a decade during difficult times when cash flow is tight. "There’s real interest in the states to do these rollovers for fiscal difficulties," he said. Printer-friendly version |
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