Budget deal would aid Ore. colleges, universities

SALEM, Ore. (AP) -- Oregon's public universities and community colleges will be among the first in line to get more money if a so-far-elusive budget compromise results in more revenue and lower employee pension costs.

Students are facing higher tuition bills next year, but university officials say those tuition increases could be reduced or even eliminated if Republicans and Democrats can end their stalemate over tax revenue and public-employee pension cuts. Community colleges have already set tuition for next year but most could freeze it in the following year.

The state House is scheduled to vote Thursday on two-year spending plans for universities and community colleges. Both are on track for increases in state support after four years of cuts, although they'll still be below their state funding levels from 2007 despite higher enrollment.

The universities are thankful to see an 8 percent increase in their state funding after several years of cuts, said Jay Kenton, vice chancellor for finance at the Oregon University System.

"But it's going to be a challenging budget and will require that our students pay higher tuition in the future, which is troubling given who those students are likely to be," Kenton said.

The State Board of Higher Education is scheduled to set tuition rates for next year on Friday. The proposed increases for resident undergraduates are between 4 and 6 percent at all schools except Western Oregon University, which has an average increase of 1.9 percent because Western students can choose to lock in their tuition rate as freshmen.

Community colleges are on track for an increase of about 16 percent in state support. Average community college tuition has increased 35 percent since 2007.

Lawmakers have been working for weeks on a compromise between Democrats, who want to raise upward of $200 million in additional tax revenue, and Republicans, who want more than $1 billion in savings from reductions in retirement benefits for government employees.

Legislators from both parties agree that most the additional revenue would go to education at all levels — primary and secondary schools, community colleges and universities — but they've been unable to agree on how to get there. A portion would also likely be allocated to mental health, lawmakers said.

Democrats have majorities in the House and Senate but need at least two GOP votes in each chamber to raise taxes.

The proposed funding for higher education is "embarrassing," said Sen. Mark Hass, a Beaverton Democrat and chairman of the education committee. But a deal on taxes and pensions would allow the state to freeze tuition for students, he said.

"That's what we will be able to do, if we can go this extra step, and I think we will," Hass said.

If the higher education board increases tuition on Friday, and the Legislature increases state support for universities, board members could reverse the tuition increases, Kenton said.