Oregon's Higher Education Coordinating Commission last week approved a suite of policy recommendations meant to increase efficiency at the state's seven public universities. If enacted, institutions would see regular audits of academic programs and could face mergers.
The recommendation report, passed in a 13-2 vote at a special Jan. 6 meeting, found that "bold action is necessary to guarantee the ongoing vitality of Oregon’s public universities."
But discussions around the report raised questions about how the recommendations would be adapted to the state’s broad range of university types.
Challenges continue
Oregon's public universities are expected to face ongoing budget shortfalls in the near future, the report said. That's despite the institutions' already significant efforts to balance their budgets.
For example, the University of Oregon last year laid off nearly 120 employees and cut almost 60 vacant positions to save $29.2 million and close a projected multimillion budget shortfall.
The smaller Southern Oregon University declared financial exigency last fall and enacted even more dramatic cuts meant to stabilize its budget following years “marked by unprecedented fiscal crises.” In September, its board approved closing 23 academic programs and eliminating dozens of positions, including 18 through layoffs.
The commission's report, created at the behest of the Oregon Legislature's Joint Ways and Means Committee, found that each university had been operating efficiently in recent years.
Even so, they are up against a shrinking prospective student pool and declining enrollment, as well as "the state’s constrained fiscal environment," the report said.
During the Jan. 6 meeting, Commissioner Michael Dembrow said any policy changes must be accompanied by increased funding from the Legislature.
"This report shows very clearly that the universities have been working hard to contain costs," said Dembrow, who voted to approve the recommendations. "It once again reminds us of just how far behind other states Oregon's funding of higher education is."
In fiscal 2024, Oregon legislators appropriated $8,625 per higher education student, well below the national average of $11,683, according to the State Higher Education Executive Officers Association.
"On the current path universities will be forced to continue to make substantial cuts annually or, in aggregate, fund balances will be completely exhausted within an estimated three to five years," the report said.
‘Institutional integration’
HECC's report advised all of Oregon's public colleges to collaborate and develop plans for "targeted institutional integration."
The integration could range from two independent colleges "operating under a single system policy umbrella" and sharing certain programs to "a full merger of two or more institutions," the report said.
In addition to its seven universities, Oregon is home to 17 public community colleges. The report suggested that a university and community college could combine services if they find they overlap regionally.
Prior to the board's vote, HECC Executive Director Ben Cannon presented the recommendation, and the report as a whole, as a much needed expansion of institutional options.
"The failure to go down that path means that we are likely to experience at many of our universities the same thing that we have been experiencing over the last several years, which is these very, very difficult budget cuts that have negative impacts on students and communities," Cannon said during the meeting.
He also cautioned against framing the vote as either approving the recommendations or continuing to make cuts.
The report "doesn't make those financial realities immediately go away," he said. “But it does put some different options on the table."
If the institutional integration recommendation is enacted as written, the Legislature would empower HECC to act as a facilitator among higher ed institutions. The commission's proposal would be due by January 2027.
A review for academic programs
The commission's report also advises the Legislature to require degree programs at public universities to be "periodically reviewed and renewed."
Its suggested metrics for judging programs include minimum enrollment thresholds, financial sustainability requirements, support for a university's mission, and the value provided for students and communities.
The report also said a university's programs should not unnecessarily duplicate its other offerings.
The audit process, which the commission would oversee, should allow institutions a "substantial window" — from one to three years — to correct the issue before shuttering a program, the report said.
Whatever the yet-to-be-established factors, legislation should "strictly limit" them as to not allow overreach, the report said.
"HECC should be required to take into account impacts on underrepresented students, institutional missions and priorities, statewide workforce needs and not strictly financial returns to the individual, and must be guided by well-researched policy, not ideological preferences," the report said.
Universities respond
University representatives showed support for the commission's efforts but warned against enacting wide-sweeping policy shifts.
Charles Hoffman, board chair at Eastern Oregon University, told HECC commissioners that officials at his institution share the goals of affordability, efficiency and long-term financial sustainability. He pointed to the 8.4% cut Eastern Oregon made to its fiscal 2025 operating budget.
However, Hoffman said at the special meeting that the call for institutional integration is "premature and could harm our regional universities."
"It assumes inefficiency where discipline already exists and it risks imposing one-size solutions onto institutions that have fundamentally different missions, different scales and different geographies," Hoffman said.
HECC's report acknowledged the significant variances in Oregon's public universities, both in their scale and the demographics they serve, and noted that sectorwide challenges would manifest differently at each.
"While each of the seven public universities will experience these trends differently — some perhaps even managing to stay cash-positive — Oregon needs all of its public higher education institutions to thrive," the report said.
Hoffman also flagged that cutting seemingly low-performing academic programs could unintentionally hurt areas where universities are seeing progress.
"Much of the growth at EOU and at other universities reflects low-cost concentrations, certificates, and workforce aligned pathways built onto existing courses. Often with net-neutral or positive fiscal impacts," he said.
Should the Legislature enact a program review, the criteria must be developed through collaboration between HECC and the universities, Hoffman said.
AJ Romero-Gemmell, the graduate student trustee at Portland State University, expressed concern that the HECC report both duplicated efforts that are already underway and could introduce challenges.
"Our board, as well as the boards at many of the universities, is already addressing many of the issues outlined in the HECC recommendations," he said.
"We should work to enhance the efforts already underway to support our students rather than introducing ideas that may inadvertently harm those efforts."
