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Minnesota State chancellor says system needs state's help with budget deficit

ST. PAUL--Minnesota State has settled on a long list of fixes for the higher education system's yawning budget deficit, but they'll need the Legislature's help, too.

ST. PAUL-Minnesota State has settled on a long list of fixes for the higher education system's yawning budget deficit, but they'll need the Legislature's help, too.

Chancellor Steven Rosenstone told trustees Tuesday that after a year of discussion, he now feels good about closing a budget deficit that's projected to grow to between $66 million and $475 million per year by 2025.

"I'm extremely optimistic. I think we do now have a road map ... that will lead to our success," he said after presenting his plan.

However, a big part of the solution is out of the system's control.

Rosenstone made the case Tuesday that the state is vastly underfunding its colleges and universities. If lawmakers were to increase per-student spending to the national average, he said, Minnesota State would have received an additional $184 million in 2013-14.

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"This is a three-legged stool," he said. "The state of Minnesota also has responsibilities and it absolutely must be an active partner in ensuring the financial sustainability of our colleges and universities."

Besides general appropriations, Rosenstone said lawmakers should consider dedicating lottery revenues to higher education or allowing for local-option sales or property tax levies.

Rosenstone's plan combines ideas from a sustainability work group and comments he's received since that group's recommendations came out in June.

Revenue proposals include:

• Raise more private donations, $35 million annual budget impact

• A variety of initiatives to get students to stay in school and graduate, $18.2 million

• Grow enrollment and customized training, $10.4 million

• Promote transfers from two- to four-year schools, $2.9 million

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• Boost college readiness in the state's high schools, $1.6 million

Cost-cutting measures include:

• Improve curricular efficiency, $21.2 million

• Keep salary increases in line with new ongoing revenue, $18 million

• l Reduce administrative costs, $11 million

• l Reduce facilities costs, $7.5 million

Trustees agreed Tuesday to move forward with the chancellor's proposals, but some wanted more dramatic changes.

"A lot of the same," Robert Hoffman said. "I think we have to just change the model. We have to be a lot more creative."

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"Dreaming even bigger, I think, is in order," Dawn Erlandson said.

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