Dive Brief:
- The political standoff between the Illinois Gov. Bruce Rauner and the state's legislature is having further negative consequences on the public higher education system, as the state enters its ninth month without a budget and public colleges and universities continue to go without funding.
- Chicago State University sent layoff notices to all 900 of its employees last week and announced it would not hold spring break to finish the semester early, though it is not clear how many faculty members will lose their jobs as President Thomas J. Calhoun Jr. said there would still be summer and fall classes.
- The Chronicle of Higher Education reports that Western Illinois University plans to cut $20 million from its operating expenses in the coming two years and lay off 100 employees, and Moody’s downgraded three other regional universities’ credit ratings, given their dwindling financial reserves.
Dive Insight:
Democrats are putting forward proposals with spending levels that Rauner, a Republican, refuses to endorse. Because higher education spending is discretionary, no laws have required payouts in the middle of the impasse. While some thought the financial strain on universities may have forced elected officials into a compromise, they do not appear to be any closer to a deal than they were a few months ago.
Northeastern, Northern, and Eastern Illinois University are the three that must now contend with a credit downgrade, which will make all of their borrowing more expensive at a time when they can least afford it. These schools will almost certainly have a harder time recruiting students for the 2016-17 school year, given their well-publicized strain. But with no end in sight and few options for external revenue, these institutions can do little more than wait.