The three-pronged Higher Education Stabilization Fund, which could help the state avoid drastic cuts to public colleges and universities in the event of another economic downturn, received the approval of the House Education Committee Thursday.
The fund would consist of three individual accounts that would provide additional funding to state schools when necessary. The first account would hold interest earned off student fees, which the bill's sponsor, Rep. Scott Bedke, R-Oakley, believes will amount to $114,000 in fiscal year 2011. The state would hold the money in reserve and allow it to grow over time. Bedke admitted at an earlier hearing on the issue that he knows the initial amount is not much, but he hopes its the start of an effort to provide a larger safety net for state schools. The University of Idaho would not participate in the program, noted Bedke, because it historically invests and manages its own interest account.
The second and third accounts would serve as "bucket" accounts, said Bedke. One account would be a reserve for four-year institutions and the other would hold funds for two-year colleges and Eastern Idaho Technical College in Idaho Falls. These reserves would receive money only on appropriations by the Legislature, which, due to large budget deficits facing lawmakers, will not happen in fiscal year 2011.
The measure will go before the full House for a vote in the next week and is endorsed by Gov. Butch Otter and co-sponsored by Sen. Joe Stegner, R-Lewiston.
(Note: Rep. Bedke had a busy day in the House Thursday. Click here to read about Bedke's plan to allow state agencies to close up shop to save funds.)