Thursday, September 22, 2011

Week In Review

State Capitol Week in Review

LITTLE ROCK – University officials reported to a legislative committee that it's a common practice for institutions of higher education in Arkansas to award long-term contracts to vendors without seeking competitive bids.

It's also common for the vendors to provide gifts to colleges and universities, such as renovations to existing buildings or donations to scholarship funds. One university president described renewing of contracts in exchange for gifts as a business arrangement in which both parties expect a benefit. Another president said that changing food vendors frequently was disruptive and expensive.

Some legislators were not convinced that the system is a good way to budget and account for the expenditure of public money at state-supported colleges and universities. If the amounts of the gifts and significant details are clearly presented in contracts, university officials can make informed judgments when comparing various offers from vendors in order to get the best deal.

Another university president, after questioning by a senator, admitted that when a food vendor awarded gifts to a university in exchange for contract renewal, the cost of the gift would be included in the price of meals in the dining hall.

The contracts are routinely for as long as seven years and can be for millions of dollars. They give private companies exclusive rights to operate book stores and dining halls, or they award "pouring rights" to one particular soft drink company to stock soda machines on campus.

Universities and colleges operate under different laws than those governing state agencies, which must seek competitive bids when they purchase goods and services in order to get the lowest price.

Higher education has a degree of constitutional autonomy that buffers universities from political interference by the legislature and the governor. However, the extent of their constitutional independence is not clear because litigation has never reached the state Supreme Court. There are legislators who believe higher education should be protected from political meddling but who at the same time believe university administrators should be more accountable to the public because they receive and spend tax dollars.

The issue has real consequences for students and Arkansas families because of the spiraling costs of a college degree. In the past five years the Consumer Price Index has gone up 11.6 percent while tuition and fees at Arkansas state colleges and universities has risen twice as fast and on some campuses three times as fast as inflation.

Higher education officials attribute the need for increased tuition and fees to the fact that state funding has not kept up with factors that drive up costs, such as growing enrollment, the need to add courses and degree programs, utility bills, new facilities and the acquisition of technology and equipment.

Highway Bond Election

On November 8 Arkansas voters will decide whether to authorize the Highway Commission to issue additional bonds that would be backed with revenue from four cents per gallon of the state motor fuels tax on diesel. According to the Highway Commission, the four cents generates a total of $23.8 million a year. Of that total the Highway Department gets $16.1 million, cities and counties each get $3.46 million and other state agencies $785,000.00.

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