Prism - September 2002
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Feeling the Pinch

- BY Warren Cohen

Engineering schools around the nation are cutting back programs and handing out pink slips as states struggle with budget shortfalls.

In 2000, Oregon legislators recognized that the state's economic base was shifting away from natural resources like timber and moving toward technology. Much of the state's employment growth was coming from the expanding number of high-tech companies sprouting up around Portland. Thus, it was with much fanfare that the legislature announced a $10 million grant to the college of engineering at Oregon State to increase its engineering graduates from 480 to 550 students by 2005. The funds would also allow the school to expand its laboratory facilities and help it vault into the nation's top 25 engineering programs. But just as OSU was swinging into action, along came a state fiscal crunch. And OSU dean of engineering Ron Adams found out the grant would likely be cut by 5 to 10 percent. “The state needs a top tier engineering program badly because of the strength of high-tech industry,” says Adams. “These cuts will slow us down.”

And Oregon State is not alone. Expansion plans at engineering schools across the nation are being stymied by a post-boom downturn that has changed the color of state balance sheets across the nation. Since fiscal 2002 budgets were enacted in spring 2001, 40 states have had to battle budget shortfalls that total nearly $40 billion, according to the National Association of State Budget Officers. State coffers, fattened by years of growth, suddenly have gotten lean because less tax revenue is coming in. At the same time, healthcare costs in programs like Medicaid have skyrocketed, increasing 10 to 12 percent a year. And since this is the second lean year, many states have already gone through their “rainy day” reserves and spent their awards from the tobacco industry settlement. “Many states used up all their savings because they thought an economic recovery was right around the corner,” says Mike Griffith, a policy analyst at the Education Commission of the States. “But now it looks like we're not going to pull out of it that quickly.”

States had been riding high thanks to an extremely healthy economy, and the crunch has hit them hard. Since 1983, state spending has increased at an average of 6 percent a year. But in the last year, state spending rose only 2 percent and it is expected to be even slimmer next year. In comparison with recent recessions, this fiscal crisis is worse. In 1992, state shortfalls totaled 6.5 percent of revenues. But this year, that figure will likely be 7.8 percent.

Since politicians of all stripes are reluctant to raise taxes in an election year, states are trying to balance their budgets through cuts. And higher education makes an alluring target. State spending on colleges and universities represents about 11 percent of aggregate state budgets, the third biggest line item behind K-12 and Medicaid. According to the National Conference of State Legislatures, 29 states have either made—or talked about making—cuts in higher education during this year's budget sessions. Increases in state tuition can't make up the difference, so colleges are having to adapt to the new realities. “It's one of the most difficult short term budgetary cutbacks in the last 30 years or so,” says Paul E. Lingenfelter, executive director of the State Higher Education Executive Officers.

Although many legislators recognize the important role that engineering programs play in turning out tomorrow's innovative workforce, they have had to treat the discipline like every other. As a result, engineering departments like Oregon State are putting their plans on hold and trying to cope. Various strategies include cutting departments and slicing course offerings, reducing the number of faculty members, delaying overdue modernization plans, and reducing any extra programs not deemed absolutely essential. Not surprisingly, engineering deans aren't happy about these changes. “We are making it more difficult to offer quality education to students,” says James L. Melsa, dean of engineering at Iowa State University.
In Iowa, the state government has experienced six waves of cuts since January 2000. This year, it faces a $219 million shortfall. Melsa is still waiting to hear the final impact on his engineering department in the coming year but expects his budget to shrink at least 2 percent. He's decided to drop two academic degrees: engineering science, which allowed students to customize their own academic program by mixing various electives, and engineering applications, a program that focused on engineers who run factories. Both have only about 20 students, and phasing them out will save approximately $200,000. In addition, a graduate program in engineering mechanics that deals with theoretical and applied mechanics will be narrowed over the next few years to focus on solid mechanics, once the 30 or so current students finish the program. That will save another $500,000.

Other electives, such as a class on radar, have either been cut or are offered less frequently. These actions come at a time when ISU has grown from 4,200 engineering undergraduates in 1997 to 4,900 last year. “Students aren't seeing big programs get killed, but they do have fewer choices,” says Melsa. “We're struggling with it.”

Painful Purge

In Virginia, the state faces a shortfall of $3.8 billion over the next two years. Leading state universities, Virginia Tech and the University of Virginia, have both been forced to trim about $24 million from their budget over the next school year and more than $30 million the following year. Tech is responding by laying off 270 staffers, with older, higher paid professors receiving severance offers. The reductions will save $15 million.

At Virginia Tech, with their engineering department facing a 6 percent budget cut, all of the 24 professors who were offered buyouts took them. That's nearly 10 percent of the entire engineering faculty. In order not to lose promising young researchers, the offer was restricted to those 50 years or older who have at least 20 years of service. Interim dean Malcolm McPherson also placed a cap on the offers so that no department would be disproportionately affected. McPherson says the early retirements won't affect the overall staffing level because he can replace the departed professors with younger faculty. A 20-year veteran earns about $100,000 annually, while an entry-level faculty member is paid about $65,000. “The major loss is in the teaching experience and teaching capabilities of the people we are losing,” says McPherson. “That's part of the price we're having to pay for budget cuts imposed upon us.”

Meanwhile, at the University of Virginia some 150 miles away, the engineering department is facing cuts in the 8 percent range. Faculty members haven't had raises for the past two years and aren't likely to get them next year either. A one-time bonus hasn't mollified disgruntled teachers, and dean Richard W. Miksad fears that other schools may try to poach his best faculty. “It's a Herculean effort to keep some of our stars,” he admits. “The best people who may move first are the ones we can least afford to lose.”

In addition, the salary freeze is accompanied by a restriction on hiring. In a typical year, Miksad can make offers on about 20 slots, but this past year he could only make seven. As a result, roughly 15 faculty positions remain open, which will translate into larger classes, especially in popular areas like computer science and biomedical engineering. UVA had to put caps on some of its biggest offerings to prevent class sizes from getting out of hand. Miksad worries that these shortfalls could ultimately affect the school's research program. UVA has been attracting more research grants, but its $200,000 annual figure per faculty member still trails peer institutions that average closer to $300,000. “If you don't have the numbers of faculty or the broad array of programs, your research program goes downhill,” he says.

Restricting Research

Maintaining a high quality research program is a priority at many schools, including California Polytechnic State University. But the Golden State is having to contend with a shortfall that could run as high as $23 billion, its biggest since World War II. Cal Poly engineering departments are girding for budget cuts that may be around 2 percent. For Bill Clark, chair of mechanical engineering, reductions in budget means it's likely that the school won't be able to replace its outmoded robotics equipment for at least another year. Students taking robotics classes have to work with an older generation of robots that can't be programmed using more modern languages. With each piece of equipment costing roughly $100,000, Clark sees little hope getting the purchase approved. “There is never quite enough money to buy something like this, and there certainly won't be if we have cuts on the order of 2 percent,” says Clark.

To help with potential budget shortfalls, Cal Poly asked its student body last March to pay $200 per quarter more in student fees. Currently, all undergrads pay $722 per quarter. The measure passed on a student vote, with 54 percent of engineering students supporting it. Students in mechanical engineering will now get to decide how to distribute their $600,000 collected from the fees. Even though there are other pressing needs for the money, such as adding more professors in key areas, Clark hopes that the students will consider buying new robotics equipment. “Our lab committee will present the students with a list of what we feel the department could best utilize,” he says. “and I'm sure they will be responsive.”

State budget problems also threaten the next generation of engineers. North Carolina faced a shortfall of $1.6 billion, and the state university system was told in May to spend only a quarter of its monthly allocation.The prospect of further cuts have hurt a statewide program called Summer Ventures in Science and Mathematics. For the past 18 years, rising high school juniors and seniors have attended math and science classes at one of six campuses in the summer. The cost is roughly $270,000 per institution.

But when state officials warned schools to reduce expenditures, many cut enrollment in Summer Ventures. North Carolina Central University, which offers a course called engineering mathematics, had to reduce the number of students who could participate and is considering cutting the number of teaching days. At the University of North Carolina at Wilmington, the program cut its enrollment from 82 students last summer to 33 this year. “We need to expose students to this opportunity that could lead to future math and science careers,” says Karen Shafer at UNC Wilmington.

Around the nation, reductions in the capital improvement budgets translate into outdated dorms and libraries, not to mention labs and facilities. Rising tuition affects the affordability of college. These higher costs are arriving at a time when the college age population is growing. The demographic bulge and tuition inflation—combined with freezes on faculty growth—could result in many promising students getting shut out of college.

Even worse, the state fiscal crisis shows no sign of abating anytime soon. State coffers tend to be replenished only 12 to 18 months after an economic recovery. And because of the uncertain economy, further spooked by terrorist threats, 2003 doesn't seem that promising either. “The general feeling is that next year will be worse,” says Griffith. The Catch-22 is that an economy ever more dependent on high-tech jobs may be putting its supply of quality science and engineering graduates in jeopardy. Warns Lingenfelter, of the State High Education Executive Officers, “I think it will be challenging for politicians and educators to meet the growing demand for quality higher education in the context of these difficult economic times.”


Warren Cohen is a freelance writer in New York City.
He can be reached at