Higher Education Budget Update – Mr. Jason Schrock, CDHE, provided an update on higher education budget issues. The legislative Joint Budget Committee (JBC) introduced to the legislature a FY 2020-21 state budget package that addressed a $3.5 billion shortfall. Many state programs were cut, including several of the Department of Higher Education’s programs. State funding for public higher education institutions’ operating budgets was reduced $493 million, or 58%. This large reduction was cushioned by $450 million in federal funds from the federal CARES Act to the state allocated by the Governor through an executive order. This money must be used by institutions for responding to public health needs resulting from COVID-19 and also to provide economic support to the state through educating and completing students. Mr. Schrock also reviewed an updated analysis of potential budget gaps faced by institutions that takes into account the state funding reduction in the FY 2020-21 budget package and federal funds provided to institutions from the Governor.
State Financial Aid Allocations – Ms. Emily Burns, CDHE, explained that due to the legislative session delay, the final state-funded financial aid allocations addressed by the action item may need to change if there were significant changes to the financial aid state appropriation. Ms. Burns indicated that this scenario was unlikely and thus is bringing the action item for commission approval despite the long bill not being adopted yet. She explained that the action item contemplates an undergraduate need-based allocation formula with -3% and +5% guardrails. Ms. Burns also stated that the Joint Budget Committee had taken action to eliminate merit aid for FY 2020-21 but that all other lines had been held flat. Ms. Burns explained that given the volatility in funding for higher education this year, she had elected to hold all other financial aid allocations flat from the prior year.