LA CROSSE, Wisconsin (WXOW) -- In the wake of the Legislative Fiscal Bureau's report claiming the University of Wisconsin system entered the current year sitting on a $650-million reserve fund, UW-La Crosse Chancellor Joe Gow said Thursday that debate on possible tuition raises in the next, two-year budget should remain in consideration.
The LFB report, issued Friday, said $414-million of the reserve surplus came from student tuition -- despite universities consistently raising tuition in recent years.
"For students, what's initially concerning is that in three years the amount of tuition money in that fund has doubled," said UW-La Crosse Student Association president Nick Bezier.
"We've been told by the UW system that we needed 5.5% tuition increases for the past six years and that's the maximum (allowable amount) under the cap right now," Bezier.
Bezier said he believes if the reserve fund continues to grow tuition must be cut or the tuition funding must be funneled into other parts of his university's budget.
But Gow disputed that campuses such as his own, which reported a reserve fund of almost $28-million, were simply stockpiling student tuition dollars with no purpose.
"Why would we sit on cash?" Gow said. "That doesn't make any sense. We're not a for-profit business."
"I kind of expect to get some criticism when we raise tuition," Gow said. "But what's not appreciated is this notion that we have some big slush fund. That's really a hoax."
Gow said in a letter to campus that all $27.7-million in the UWL's reserves are earmarked for specific projects. The chancellor sent out a full summary:
Extra Class Sections & Curriculum Development $1.3 million
Online & Service Based Programs $1.9 million
Faculty Hiring Start-up Funding $1.3 million
Classroom & Lab Facilities $2.8 million
Classroom Equipment & Technology $2.6 million
Technology Infrastructure $2.8 million
Enrollment Initiatives $1.2 million
Differential Tuition Program Contingencies $13.8 million
Gow said the $13.8-million devoted to "differential tuition program contingencies" constitutes roughly one year of pay, plus benefits, for 202 UWL employees.
Gow said those employees are paid solely with tuition money and not using state funding.
"The people in those jobs, if enrollment goes down and we don't have as much tuition, we still have to pay them," Gow said. "So we've held back some money."
Gow added that a tuition freeze, which has been backed by Gov. Scott Walker as well as ranking members of both parties in the state legislature, would effectively negate the possibility of university employees being given pay raises.
He said that could mean those workers depart the UW system for greener pastures.
"Our people haven't had a pay increase in over five years," said Gow. "You're going to lose the top talent and we need to address that very soon. We were hoping to do that with a very small tuition increase this time around but now it looks like the legislators aren't going to let us do that."
The UW had called for a roughly 2% increase in tuition over the next budget.
Bezier also remained skeptical of the possible freeze.
"I'd rather see a tuition cap than a freeze if it means faculty are going to leave for other institutions," Bezier said. "I think there's a compromise that can be found."
It's highly unlikely state lawmakers would agree to new tuition hikes following the release of Friday's report.
But the Governor's budget proposal as written provides a boost of approximately $180-million in state funding to the UW during the next biennium.
Gow said while the state money alone will not be enough to increase pay to workers, his campus would be able to avoid cutting any resources if the budget is passed as proposed.
Walker has not said whether or not he will amend the proposed funding levels for the UW system in light of the LFB's findings.
But a spokesperson for the Governor said a decision regarding a possible request to freeze tuition and changes to Walker's budget proposal should come in the next nine days.
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