Cascades campus funding may rise
New designation would let state give school more
Published: July 05. 2006 4:00AM PST
It's all in a name - even when money is concerned.
If the Oregon University System board approves a new classification for Oregon State University-Cascades, the Bend branch campus could stand to receive more money from the state.
The board is deciding how to figure the Bend campus into its funding model for state schools. Because OSU-Cascades is a branch campus, it qualifies for less state money than schools classified as regional, stand-alone campuses.
With the new change, OSU-Cascades would get money based on enrollment rather than simply receive a lump sum.
Since the campus has been experiencing consistently high growth, OSU President Ed Ray asked at a June board meeting if there was another way the campus could get more money from the state.
When it started in 2001, OSU-Cascades was a targeted line item on the budget the university system presents to the state, which means it received a lump sum from the state to cover startup costs.
It is now treated more like a regional campus so that it can receive what's called a small school subsidy.
The subsidy is support the state provides for campuses with fewer than 7,500 full-time equivalent students. The smaller the school, the more it will receive.
The board is now grappling with how much of a subsidy to give the Bend campus.
"It has high startup costs, which would argue on the side of giving it more," said Jay Kenton, vice chancellor for finance and administration with the Oregon University System. "But on the other hand, it doesn't stand alone or have all the infrastructure of a stand-alone campus."
In the 2005-06 university system budget, OSU-Cascades received $3.4 million from the state. The small school subsidy made up $2.8 million of the total operating budget from the state's general fund.
By comparison, the much larger regional Eastern Oregon University received $13 million from the state. The small school subsidy made up about $3.3 million of that, Kenton said.
Part of the issue is that the state's universities had big funding cuts after Sept. 11, 2001. The board dealt with that by freezing the enrollment part of the budget, Kenton said.
In other words, the board decided to allocate funding for the 2005-07 biennium based on what enrollments were in 2002-03.
But OSU-Cascades went from 172 full-time equivalent students in 2002-03 to 262 in 2005-06. Since each full-time student equivalent gets about $4,000 from the state, he said, the 90-student difference cost the campus about $360,000.
"We (the university system) started out in 2001 with a pretty good budget, and then 9/11 happened and the economy kind of tanked," Kenton said. "We ended the biennium with a lot less money than we started with. ... It was a bad time to be starting up a campus."
OSU-Cascades is waiting anxiously for a decision.
"Right now, funding from the state has remained flat," said Jay Casbon, campus executive officer and vice provost of OSU-Cascades. "We're the only campus that this is the case, and we're the fastest-growing campus. These are not the kind of calculations that make sense to me."
Casbon said the campus, which currently has about 600 students, has twice the students it did when it opened in 2001.
The campus has also increased program offerings by a third and doubled its faculty.
If the campus got extra state funding, he said, OSU-Cascades could add new programs to meet the needs of Central Oregon's emerging economy.
Extra science classes, pre-med and pharmacy programs and a four-year nursing degree are all programs Casbon said the campus could develop with extra funding.
"These are things that are possible here and are wonderful matches for the robust economy that Central Oregon has," he said.
The board will likely discuss the OSU-Cascades funding model at its July 14-15 meeting, said Mark McCambridge, vice president of finance and administration of Oregon State University.
"The cost to operate a small campus is a much greater percentage of the overall budget than to operate a much larger campus," he said.
It is much less financially efficient to run a small campus because staff and administration deal with fewer students, he said.
"What we're saying is that the Legislature determined when Cascades began that they ought to have X number of dollars per year to get started," McCambridge said. "And now that the campus has grown significantly, we're saying that it should be looked at not just as targeted funds but as a regional campus. It should be recognized and funded that way."
If the board approves the reclassification at its July meeting, the proposal will then go to the Legislature and the governor's office for approval, McCambridge said. Typically, the Legislature deals with higher-education budgets in March, and it could have a finalized budget by July 2007, he said.
While no decision has been made yet, officials were optimistic about OSU-Cascades' financial future.
"On this board, there is a great degree of interest in serving the educational needs in Bend, Oregon," Kenton said. "We are interested in helping Cascades be successful, and I think everybody would agree on that."
Monique Balas can be reached at 617-7831 or at mbalas@bendbulletin.com.
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