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May 27, 2005 :: State Funding for Higher Education Near FY 2003 Levels

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Significant increases for state scholarship programs and additional funding for Oklahoma’s public colleges and universities highlight higher education’s appropriations for fiscal year 2005-2006, the Oklahoma State Regents for Higher Education announced today.

State lawmakers recently approved a funding increase to higher education of $87.3 million for FY 2006, which begins July 1. The new monies represent a 10.8 percent increase from the $802.1 million the state system received in FY 2005. However, more than $15 million of the $87.3 million will go toward capital bond payments during FY 2006, leaving the remaining $72.3 million for state system operations and programs. That amounts to a 9 percent net gain in state appropriations for higher education.

Higher education officials said the increase will allow colleges and universities to restore most of the budget reductions they were forced to make during FY 2003 and FY 2004 when the state experienced significant revenue shortfalls. It also means tuition rate hikes next year will most likely be held under 10 percent. Earlier this spring, officials warned that many students would likely see double-digit increases in their tuition rates if funding was not adequately restored to previous levels.

“Having a nationally competitive system of higher education is critical if we expect to see our state’s economy grow in the 21st century. This increase in funding will help ensure that our public colleges and universities can attract top faculty and provide their students with a quality, but still affordable, college education,” Chancellor Paul G. Risser said. “This increase, coupled with the passage of the capital bond issue this session, sends a strong signal to business that our state is willing to invest in higher education.”

Risser said the allocation recommendations were based on four objectives of the state system, including (1) generating fairness and equity among institutional allocations; (2) moderating any tuition increases; (3) increasing the number of college graduates; and (4) improving academic and research quality.

Colleges and universities will receive nearly $53 million of the new monies, $34.5 million of which will be distributed among the institutions as part of their base-funding allocation. More than $6.9 million will pay for unfunded building operations on college campuses, and both the Oklahoma State University Agricultural Experiment Station and the University of Oklahoma will get an additional $2.5 million each.

Scholarships and grants will receive an extra $14.1 million, which represents a 32.2 percent increase over FY 2005 funding. The Oklahoma Higher Learning Access Program (OHLAP), which pays college tuition for students who meet certain academic and behavioral requirements in high school, will get the majority of that money – $12 million. Higher education officials expect approximately 12,000 students will receive an OHLAP scholarship in FY 2006.

The remaining $3.9 million of the $72.3 million will go toward paying system and mandatory allocations, including $1 million for a new Brain Gain initiative and $1 million for the second-year participation in the National LambdaRail (NLR).

The National LambdaRail is an ultra-fast fiber network that is 100 times faster than the conventional Internet and is a major initiative of U.S. research universities and private-sector technology companies to provide a national-scale infrastructure for research and experimentation in networking technologies and applications.

OneNet, Oklahoma’s official telecommunications network for education, government and research, will be offering its statewide network to link to the NLR and provide immediate access to Oklahoma’s research institutions.

“This has been a very good year for higher education in Oklahoma,” said State Regents’ Chairman Jimmy Harrel. “Significant increases in our state appropriations and full funding of the OHLAP program underscore our legislators’ and Governor Henry’s strong commitment to improving the funding commitment for higher education. We are grateful for their support.”