Budget panel to consider UW tuition cut, performance funding

MADISON — University of Wisconsin System students would save hundreds of dollars on tuition and campuses would have to compete for additional state funding under provisions in Gov. Scott Walker's budget that are up for votes Tuesday in the Legislature's powerful finance committee.

The Joint Finance Committee is in the midst of rewriting Walker's budget before sending it on to the full Senate and Assembly for votes. The committee's work is key because the panel essentially finalizes the spending plan. The Senate and Assembly rarely make further changes to the document before sending it back to the governor, who signs it into law. Walker can use his partial-veto power to make changes to whatever lands on his desk.

The two-year budget Walker submitted to the Legislature calls for extending a four-year-long freeze on resident tuition rates for another year and cutting tuition by 5 percent in 2018-19. That would translate to a couple hundred dollars of savings for students annually. The budget would supply the system with $35 million to offset the lost revenue.

Walker's proposal comes as he's gearing up to run for a third term next year and looking for inroads with student voters. The cut faces long odds in the finance committee, though. Republicans have greeted the proposal with skepticism. They're wary of pumping more tax dollars into the system to balance the lost tuition money. The Legislative Fiscal Bureau estimates that a 5 percent cut would actually cost the system $42 million, not $35 million.

Republican Rep. Dale Kooyenga, a finance committee member from Brookfield, has proposed allowing the system, individual campuses or even individual programs to raise tuition to match the inflation rate or the latest increase in the state's median household income, whichever is less. Assembly Speaker Robin Vos has said he would rather increase financial aid than cut tuition.

The committee also could choose to use a portion of the $35 million Walker earmarked for tuition backfill to fund 2 percent salary and benefit increases for UW employees. The increases were supposed to have been covered under Walker's budget by savings generated by moving the state to a self-insurance model.

Under such a plan, the state would directly pay for the health insurance of about 250,000 state workers and their families rather than purchasing it for them through an HMO. The state would assume the risk for medical claims.

Republican legislators aren't convinced such a move would generate the savings Walker has promised. Finance committee leaders have signaled they won't approve such a model.

Another component of Walker's budget would allocate an additional $42.5 million in state aid for the system, which UW officials have applauded in concept. The system endured a $250 million cut in the last state budget.

But the money comes with strings attached. The budget creates a lengthy list of performance standards for UW institutions, including affordability, student work readiness, student success in the workforce, campus efficiency and community service. Each category has a number of detailed sub criteria as well, ranging from time to degree to percentage of students who participated in internships. Schools that do a better job meeting all the criteria according to a scoring system the Board of Regents would establish would get bigger chunks of the $42.5 million.

Twenty-six states have implemented similar performance-based funding for public four-year schools, according to a 2015 report from the National Conference of State Legislatures.

Walker's proposal has raised questions, though, about whether it would discourage high-performing and low-performing schools from improving their performance and whether the money is enough to cause any school to change its behavior.

Other budget proposals up for votes Tuesday included increasing grants for UW System students, private college students and technical college students by $5.6 million and opening up a program that grants free tuition at UW System and technical colleges to children and spouses of dead and disabled veterans who enlisted at any location in the country. The family would have to have lived in Wisconsin for at least five years before a member starts college.

The program currently requires that the veteran had to have been a Wisconsin resident when he or she enlisted.