Tuition could increase next fall if Ohio Gov. John Kasich cuts education funding to close the state’s nearly $10 billion deficit.

“All state governments, all universities are all waiting to see what happens in Columbus,” President Lester Lefton said.

Since the recession began, tax revenue in Ohio has decreased leaving the state with less income to pay its bills, said Curtis Reynolds, Kent State economics professor. This left Ohio with a budget shortfall currently estimated to be between $8 to $10 billion for the next two years.

Unlike the federal government, Reynolds said states, excluding Vermont, are not allowed to carry a budget deficit. To balance the budget without raising taxes, states must cut services and lower the cost of their bills.

Kasich ran his election campaign on a platform of deregulation and promised not to raise taxes in order to plug the budget shortfall in Ohio. He is now faced with looking at all public spending, including higher education, and deciding where to cut.

“It’s important to recognize that universities spend every dime that they get, it’s not like we make profits that we keep,” Lefton said. “And when we are trying to hold tuition down, any cut that you get has consequences.”

For the last two years, Ohio had a tuition increase cap of 3.5 percent. If Kasich cut higher education funding, removing the caps would allow universities to make up for their own budget shortfalls by raising tuition.

Reynolds suspected that the cap on tuition would rise in the next budget, he said.

“The expectation is that (Kasich) is going to cut funding for education,” Reynolds said. “But being more of a free market sort of guy, he would allow tuition to rise.”

Tuition for an Ohio student at a public university is almost $2,000 above the national average, and ranked 11th highest in the country in 2009, according to the National Center for Education Statistics. In 2008, Ohio ranked eighth.

The tuition cap over the last two years has been responsible for the drop, Reynolds said.

For the 2009-2010 academic year, Reynolds estimated Ohio to have dropped further down on the list to 13th.

Tuition caps are rare, Reynolds said. Since the recession, they’ve been growing even more rare.

“The overall theme right now is that states are pretty unlikely to have tuition increase caps,” Reynolds said.

Chris Christie, New Jersey governor, said he is considering moving in that direction. At a recent press conference, Christie said keeping New Jersey’s 4 percent tuition cap in the last budget might have been a mistake, and he is considering removing the cap completely from this year’s budget, due next month.

State colleges in California raised tuition by 30 percent in a single year because of a budget shortfall of more than 50 percent in 2009.

“It’s a worst case scenario, but it’s not one that Ohio actually faces,” Reynolds said.

California had one of the highest state budget deficits in the country, combined with historically low state tuition. This meant the state’s public universities relied heavily on government funds at a time when money became scarce, Reynolds said.

“States are looking for ways to save money,” Reynolds said. “One of the ways states have been saving money for about the last 40 years is to cut education funding.”

Reynolds said California is a cautionary tale, but realistically, students at Kent State will probably be facing a much smaller tuition hike next year.

Lefton said Kent State receives about 23 percent of its funding from the state, so it is far less reliant on the state for operating costs than California. An increase in tuition would also assume that the administration made no cuts in its spending.

But Lefton said that will not be the case.

“Our principle goal, no matter what happens, is to spare students as much as possible,” Lefton said. “But the truth is you never save your way to success. Cutting is not the way to win in a difficult economic time.”

The Ohio Board of Regents made recommendations to Kasich’s administration about a few cost-saving measures for higher education, press secretary Rob Evans said. One such suggestion has been to allow universities to participate in joint purchasing agreements.

“For example, all universities buy mattresses, so why not allow them to buy together and drive down costs that way,” Evans said.

Lefton said that while shared purchasing agreements are good, they are “not going to save millions. But there are lots of things that we buy, and where we can save money we want to do it.”

Another cost saving measure Evans suggested was to remove the legal prohibition, known as multiple prime, that currently prohibits state institutions from contracting out construction management.

When a university decides to build a building, it has to hire the plumber, carpenter and electrician all separately rather than hiring one general contractor, Evans said. This leads to significant cost increases because universities waste time and resources trying to coordinate all the different contractors.

Lefton said he completely agrees with Evans and that every university president in Ohio shares this view on multiple prime.

“It costs every university in the state enormous amounts of money,” Lefton said. “The legislature is unfortunately under extraordinary political pressure to keep multiple prime in place under the labor unions.”

He thinks that getting this past the legislature would be a “Herculean feat,” but Lefton said the new government in Columbus might have a better chance than administrations in the past.

“There’s been lots of rhetoric in the past few months that this governor and this legislature will be pro-deregulation,” Lefton said. “And the reality is there is a Republican house, a Republican senate and a Republican governor.”

Until the governor gives his budget on March 15, Lefton said he plans to focus on trying to enhance revenues at Kent State through distance learning, graduation rates, fundraising and retention. He also said that all the vice presidents have begun the process of scenario planning for different degrees of budget cuts.

“We’re hoping for the best and planning for the worst,” Lefton said.

But he said he is aware that the legislature in Columbus faces tough times and tough choices.

“Some agencies are going to have to be cut more severely than others,” Lefton said. “I would make the argument that higher education is so central to job development in Ohio that it would be a huge mistake for the legislature to cripple universities.”

Contact Anna Staver at [email protected].