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A reasonable cost-cutting move, or ‘micromanaging’ higher-ed spending?

An administrative cost reduction at Minnesota’s public higher education systems seems reasonable to Republican Sen.

An administrative cost reduction at Minnesota’s public higher education systems seems reasonable to Republican Sen. Jeremy Miller, but opponents call his attempt to legislate the cuts “micromanaging” a lean sector.

The Senate Higher Education Committee heard Miller’s bipartisan legislation Monday along with strong testimony from the Minnesota State Colleges and Universities system.

His bill would mandate that MnSCU cut 10 percent from its central office for the next budget cycle while requesting the University of Minnesota to do the same.

“They can do this without negatively impacting the students,” Miller said.           

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MnSCU Vice Chancellor Laura King told the committee that the system’s administration is “dangerously lean.” She noted the central office accounts for about 2 percent of MnSCU spending and that the administrative budget has been cut at least 22 percent since 2009.

Important processes system-wide, including legal services and capital improvement efforts, as well as the introduction of a giant new technology system, could hang in the balance if too many cuts are required, King said.

“I think we’ve done a very good job of responding to the services that campuses want … and no more,” she said.

But Miller respectfully disagreed. Increases in MnSCU’s administrative budget significantly outpaced system wide spending between 2002 and 2009, he said, citing a legislative auditor’s report.

“We’re not talking about abolishing the MnSCU central office, we’re talking about a 10 percent reduction,” he said.

Ranking DFLers on the committee rose in defense of higher education, sparring with Miller about the motivation, effect and practicality of forcing the cuts.

“I think it’s micromanaging on the part of the Legislature to be so specific [about the reductions],” ranking DFLer Sandy Pappas said after the hearing. “You either trust the Board of Trustees or you don’t.”

Much of the discussion focused on MnSCU because no university representative testified. Donna Peterson, the U’s chief lobbyist, met with Miller before the meeting to discuss specific language in the bill.

Despite remaining absent, the state’s land grant institution managed to walk away without the responsibility dumped on MnSCU.

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The committee passed an amendment “to request” the university to make the cuts, while retaining the bill’s original mandate to MnSCU. Pappas said she proposed the amendment because of a longstanding relationship between the state and the institution that calls the legality of such specificity into question.

The university declined to comment on the legislation.

One major hang-up comes because the university doesn’t have a central office or a dedicated administrative budget, and the nature of the cuts is only broadly specified in the bill.

“It’s hard for me to tell you how much we spend on something that [Miller] doesn’t define,” university CFO Richard Pfutzenreuter said.

The legislation was laid over for possible inclusion in an omnibus higher education bill.