The following are talking points on the six issues that are being used to
mislead the public about the universities. The higher education partnership
is encouraging members to stay true to the message--equal treatment for
higher education and K-12.
Also, attached is a copy of the Birmingham News editorial from April 13,
Question 1- Why University Fund Balances are not Sufficient To Cover the Cost
Restricted funds cannot be used to pay operating expenses.
- While most institutions have reserves, they are not extravagant. Most
could operate less than a month on reserves.
- The National Association of College and University Business Officers
recommends that sound business practices be applied to the management of
institutions. They further suggest that operating reserves are a
characteristic of good management. National accreditation agencies also
recognize the importance of reserves in best management practices. Loss of
accreditation results in the loss of faculty positions, inability to attract
new faculty, decreased value of diplomas. Lost accreditation puts student
loans in jeopardy. Loans account for more than half of the students enrolled.
- The items characterized as fund balances include many non-liquid assets.
Among the assets counted in fund balances are textbooks in libraries and fuel
for fleet cars.
- The dollars that are encumbered for expenses already incurred are not
available for expenditure.
- Fund balances include receivables and prepays, which are not available
for operating expenses.
- The university fund balances that were reported are not the only fund
balances that exist. K-12 has school systems that have reserves. In 2000, the
City of Eufaula had $3.9 million, Lee County had $11.4, Birmingham City had
$41.9 million, Lawrence County had $3.9 million, etc.
Question 2 - Why Per Student Appropriation Comparisons are Misleading
The dollars appropriated to universities and to K-12 are utilized in a
predetermined manner to deliver a different set of outcomes? It costs more to
educate a college student than a second grader. The costs of educating a
chemist or engineer are much greater than the cost of teaching a second
grader about multiplication.
- Calculations, which include restricted funds such as endowments and
federal grants, cannot be used in per student appropriation comparisons
because these dollars are not available to cover operating expenses.
- Research projects, which are great examples of restricted funds, are used
to develop the state's economy. Without the scientific research surrounding
the space station what would life be like in Huntsville? Where would the
Wiregrass Region be without the developments in peanut research?
- Teaching doctors to practice medicine is the responsibility of two public
institutions in Alabama. This is due to the fact that no private medical
school exists in state. With a greater level of demand for public medical
education comes a greater requirement for state appropriations. To compare
dollars invested in professional training with dollars invested in a K-12
classroom is inequitable. Making this comparison will skew the numbers.
- The correct manner for comparing per student appropriations at K-12
schools and the universities was developed by the Southern Regional Education Board (SREB) and uses general-purpose operation appropriations.
Universities have $22,000 in appropriations per Full Time Equivalent
(FTE) Student. This figure is taken from a spreadsheet total that includes
non-state funds such as restricted endowments, grants and contracts.
- Appropriate Comparison
The SREB reports that universities receive $4871 per FTE student that
ranks Alabama 14 out of 16 southeastern states in student appropriations. The
SREB figure includes all general-purpose state funds. The funds available for
instruction. The SREB calculation utilizes a methodology that is generally
accepted by institutional research officers across the nation. These are the
appropriations that can be linked directly to instruction.
Question 3 - Why would the Teachers' Union (AEA) use $1,488,333,157 of
endowments to criticize the universities:
The Alabama Education Association is wrong to highlight endowment dollars as
spendable income; $1,488,333,157 represents dollars that have been donated
for restricted purposes. The dollars that are available in endowments are
designated for special circumstances like research or scholarships. Yes,
Alabama's universities have endowments and so do the other universities in
the southeast. Endowment income is necessary for institutions to compete with
Could it be that AEA is trying to hide some facts? A recent report (2000)
from the Public Affairs Research Council of Alabama showed that since the
inception of the Foundation Program (K-12 funding) in 1996 that $566 million
of growth has been generated, yet only 1 percent or $6 million has been used
for instructional support and textbooks. Teacher unit salaries and fringe
benefits have accounted for 76 percent or $465 million of this growth. Other
current expenses have accounted for 15 percent or $85 million. Only, 1
percent has gone directly to the school children!
The shame of this statistic is that when the teachers' union (AEA) worked to
pass this legislation in 1995 they claimed that the reason for the bill was
to make sure the children of the state received an adequate and equitable
education. The reality is that the Foundation Program has been used to
provide more benefits for K-12 employees, not more support for the young
Question 4 - Why does the teachers' union (AEA) attack rather than explain?
What about mandated salaries and "PEEHIP?"
It is the health insurance secret. Alabama's K-12 employees are the
beneficiaries of the nation's best health insurance plan. In the 2002
education budget, it may seem that all of education is cut by 6.2 percent
with 70 percent of the new money given to K-12 and 30 percent higher
education. However, that is not the whole story. No, the truth is that the
K-12 employee health insurance, known as Public Education Employee Health
Insurance Plan (PEEHIP), is receiving close to $70 million dollars even in a
year when there is proration. Everything else gets cut, not this benefit. The
state is paying $414 per month for K-12 health insurance and the employee is
paying $2 per month. What average citizen would not accept a health
insurance payment of $2, $10 or even $50 per month. Health insurance should
be provided for all of the state's education employees. However, the
teachers' union (AEA) has structured an unreasonable health insurance plan
that must be revisited. The teachers' union is asking Alabama citizens to pay
for a benefit for K-12 employees that the people of Alabama cannot afford for
PEEHIP is the Alabama Education Association's major concern, not the children
of the state. The union is proving, in this terrible proration crisis, that
it would rather destroy higher education and hurt the school children of the
state than change this insurance program. The teachers' union (AEA) has
managed to set up the budget so that the mandated pay raise and the PEEHIP
appropriation take first priority EVERY YEAR. No wonder the State Department
of Education says the school systems are financially distressed. Someone
should ask, how many of those school systems were already in distress before
proration even arrived? Why are so many K-12 systems under "alert" status?
In 2000 the Alabama Education Association (AEA) pushed legislation through
the Alabama legislature mandating that K-12 teachers be paid the national
average in salaries. The rationale for passing the legislation was based on
the belief that Alabama's K-12 schools could not compete with other states
for teachers. It was argued that the teacher was the most critical component
for improving the quality of education. Certainly, the importance of the
teacher's contribution is not to be denied.
What was the most viable argument against mandating that K-12 teachers'
salaries reach the national average? It was the funding process used for
reaching the goal. The state teachers' union (AEA) convinced the legislature
that this goal could be reached by committing 62.5 percent of each year's
growth in education revenue to this purpose. With scarce resources available
to fund education, paying for these salaries would take money from other
areas of education. What happens when last year's mandated pay raise is
measured against future year impact? Children in K-12 will have to go without
books, supplies and technology. Universities will fall farther behind their
competitors by having higher tuition and low salaries. To emphasize the
disparity of this problem, the Public Affairs Research Council of Alabama in
a 1999 report claims that the salaries of Alabama's K-12 teachers already
rank 23rd in the nation while university faculty rank 44th.
If teachers were already well compensated, why did the bill pass? It passed
because the state teacher's union (AEA) had a stranglehold on the Alabama
legislature. Plus, the Siegelman Administration cut-a-deal with the K-12
teachers' union (AEA) and ignored the fact that EVERY other education support
organization in the state opposed the manner in which this bill was written.
Now, with the help of the Siegelman Administration, the teachers' union (AEA)
is at it again. They are leading the charge to force the universities to take
second-class status whenever proration occurs. In times of proration, AEA
wants the state to protect K-12 salaries and make the rest of education take
the crumbs. For a K-12 employee, this may seem admirable. For higher
education, it is even worse than it seems.
Question 5 - What is the truth about the number of public universities in
Alabama has 15 very good and efficiently operated public universities. The
regional average for the number of four-year state universities is 12.4.
Alabama has only 2.6 more public universities because of a shortage private
universities. While Alabama has 18 very good private universities, the
average number of private universities throughout the Southeast is 29.
Alabama is 11 private institutions short of the regional average, which
explains the greater need for four-year public education.
In additon, Alabama is a poor state. The state's average per capita income
is approximately 80 percent of the national average. This creates a greater
dependency on public four-year education.
Moreover, Alabama's universities follow a strict guide for course
creation and implementation. Even though, they are funded at 60 percent of
the regional standard, as determined by the Southern Regional Education Board
out of Atlanta, they still have been willing to put themselves under the
microscope. The higher education reform legislation of the mid-1990's has led
to the elimination of over 1000 university programs because they did not meet
the efficiency standards. Universities are accountable and public higher
education is the key to Alabama's economic future.
Question 6 - How can the teachers' union (AEA) criticize the universities for
having less students than K-12?
If the state funded higher education like other states in the region, Alabama
would not rank 37th in the nation in the number of citizens with college
Even more, state leaders take into account the difference in student numbers
when they appropriate 70 percent of the new money to K-12 and 30 percent to
higher education. Considering how much more it costs to educate a person in
biochemistry than it does to teach a second grader, the funding is definitely
skewed toward K-12.
WOULDN'T IT BE BETTER TO STOP CRITICIZING AND BEGIN LOOKING FOR WAYS TO
ENCOURAGE EDUCATIONAL ADVANCEMENT AT ALL LEVELS! WOULDN'T IT BE BETTER TO
TREAT ALL OF PUBLIC EDUCATION EQUALLY!
BELOW IS A COPY OF THE APRIL 13 EDITORIAL FROM THE BIRMINGHAM NEWS
Hubbert's JIH Ad
Destructive Campaign Shows Union Boss for Who He Is
It must be that Alabama Education Association chief Paul Hubbert is just a
Hubbert didn't get exactly what he wanted during the Legislature's special
session on the education funding crisis, so now he's lashing out, like a
spoiled child who didn't get his way on the playground. Apparently, it's
beyond the union boss' comprehension that higher ed officials would protest,
and rightfully so, that they were being treated unfairly in forced budget
Hubbert's misleading, paid rants against higher education are destructive.
The AEA's false television ads are bad, and last weekend the teachers' union
ran large newspaper ads that were also grossly misleading. All the ads are
part of a campaign that pits K-12 against higher ed by falsely painting
higher ed as flush with cash.
Visit the Opinion page
The most recent ads claim that state universities have as much as $1.5
billion in the bank. "Why are our universities whining?" an ad in Sunday's
Birmingham News asks.
Of course, not one to let facts get in the way, Hubbert fails to point out
that those "investments and endowments" are restricted. The money may be
earmarked for scholarships or have a specific use designated by the donor who
gave it. Indeed, one of the reasons colleges and universities have to raise
so much money from private sources is because of poor state funding. For
example, less than 10 percent of capital improvements at the University of
Alabama at Birmingham have been financed by the state, and universities must
maintain adequate reserves to cover the bonds they're forced to sell because
state funding is so low.
Too, Hubbert conveniently ignores the partnerships state colleges and
universities have with K-12 schools across the state. Forget that it's the
many schools of education that provide Hubbert with his members. There are
numerous programs that public schools would have to do without if it weren't
for the universities.
UAB alone has hundreds of programs that directly benefit public schools,
including after-school programs that help keep students from dropping out;
one-on-one tutoring for children who are reading below grade level; a
training program with area school systems to help teachers improve their
skills; a program that allows hundreds of high school students to see theater
productions for free; and vision, dental and health screenings for thousands
of Birmingham area children.
There are too many to list, but that doesn't interest Hubbert in the least.
If Hubbert truly cared about education in Alabama, he'd stop his jihad
against colleges and universities right now. He would apologize. But don't
hold your breath.
Like any big labor boss, the only thing Hubbert really cares about are his
union members - teachers and school workers. (Of course, those members pay
him hundreds of thousands of dollars a year so that he'll "really care.")
Despite exploiting schoolchildren in his ads, Hubbert's concern isn't about
schoolchildren. If Hubbert cared about schoolchildren, he wouldn't have
fought so hard for so long against background checks for teachers. His
concern isn't about decent school buildings, or new technology, or even
better textbooks. It's about salaries, benefits and job security for the
workers in schools.
Hubbert has earned his pay there, but when it comes to improving education
overall, he's done next to nothing.