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PANEL TOLD HIGHER EDUCATION NEEDS MORE MONEY While Governor Jennifer Granholm <http://www.gongwer.com/index.html?link=bio.cfm&nameid=6701&locid=1> 's proposal to boost higher education spending by 3 percent in the 2008-09 fiscal year is encouraging, the state has to engage on a course of consistent additional funding for its universities if the schools are to play a major role in turning Michigan's economy around. At the opening hearing on the proposed higher education budget for the upcoming year, the Senate Higher Education Appropriations Subcommittee heard that while most states have boosted spending on higher education over the last five years by 23 percent in Michigan it has decreased by 11 percent. Mike Boulus, executive director of the Presidents Council State Universities of Michigan, said that, adjusted for inflation, universities have lost $2,600 per student from state funding. And Wayne State University President Irvin Reid, joined by the presidents of Michigan State University and the University of Michigan, said "Our world class universities will not stay that way unless government puts a premium" on higher education funding. But Sen. Tom George <http://www.gongwer.com/index.html?link=bio.cfm&nameid=20601&locid=1> (R-Kalamazoo) said the state is not paying universities as much because it is paying more for health care. Much of those health care costs are for diseases that can be at least partly blamed for behaviors, such as smoking, he said, and he asked the three university presidents, who appeared together, if they would ban smoking by all university employees. UM President Mary Sue Coleman said she would not, but she, MSU President Lou Ann Simon and Mr. Reid said the issue of health care cost control is a serious issue that must be dealt with nationally. They also said they all have programs in place to deal with health issues at their universities and to improve health practices in the community. Also asked about whether universities should tap into their endowments to help keep tuition costs low (as Ms. Granholm suggested they might have to), the presidents said this issue would provide them with an opportunity to explain how endowments work and how the vast majority of endowment funds are encumbered for specific purposes and not available for general purposes like student tuition. The Tuesday hearing was the first the panel will hold in which it will hear from all the state's 15 public universities (the presidents of Eastern Michigan University and Lake Superior State University also spoke at the meeting). The presidents of the state's three largest universities appeared together as the university research center universities. They said they represent the largest such concentration of such universities in the nation, with more than 130,000 students, and except for the amount spent on research in universities in northern and southern California, more money is spent on research at the three schools - $1.27 billion - than at similar centers in North Carolina, Massachusetts, Pennsylvania and Illinois. The importance of higher education to the state's economy was a key to the testimony of the officials. Mr. Boulus said it was critical to the state to attract and retain talented young workers, and getting more students in the state to attend university is critical to that goal. The increase that Ms. Granholm is proposing to the higher education budget is the first in six years, he said. If the state will contribute more money to their operations then the universities can start to moderate the increases in tuitions, he said. In fact, Ms. Simon said MSU began developing an endowment because the relationship between the university and the state changed dramatically. In the era of former President John Hannah it was always assumed the state would finance the bulk of the universities financial needs. That has clearly changed in the decades since, she said. (Last week, when Central Michigan University announced it was forced to drop its tuition promise, President Michael Rao said he worried whether the public financing aspect of public higher education would continue long into the future.) Even so, Mr. Reid said the universities would "never lessen their commitment" to the needs of the state and the communities. But the presidents also pressed on the committee that the world's top economic nations are determined to improve their schools. The University of Shanghai, in China, produced a list of the world's top 300 schools. All three of Michigan's biggest universities are on that list, Ms. Simon said (and UM and MSU are in the top 100), but the list was produced because it is China's goal to place 50 of its colleges in that list. And 25 Chinese college presidents will visit all three of the universities to review their systems, she said. Michigan is not just competing against the other schools in the Big Ten or other schools across the nation, it is competing globally to remain in the top level of higher education, she said, and officials have to keep that mind.