SF 3

2nd Engrossment - 92nd Legislature (2021 - 2022) Posted on 11/09/2021 01:25pm

A bill for an act
relating to state government; reducing planning estimates in the February 2021
forecast; report on the expense patterns of public higher education institutions.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1. ADMINISTRATIVE EXPENSES REDUCTION.

Notwithstanding any law to the contrary, when preparing the February 2021 budget
forecast under Minnesota Statutes, section 16A.103, the commissioner of management and
budget shall reduce the general fund administrative expense planning estimates for each
state agency by five percent each year in fiscal years 2022 through 2025. For purposes of
this section, "state agency" means a department, commission, board, or institution in the
executive branch, but does not include the Department of Human Services direct care and
treatment program, the Department of Veterans Affairs, or the Minnesota State Colleges
and Universities.

EFFECTIVE DATE.

This section is effective the day following final enactment.

Sec. 2. REPORT ON THE EXPENSE PATTERNS OF PUBLIC HIGHER
EDUCATION INSTITUTIONS.

(a) The Board of Trustees of the Minnesota State Colleges and Universities shall perform
an internal audit of expenditures to determine the extent to which administrative costs have
increased based on uniform, historical data, and provide a report to the chairs and ranking
minority members of the house of representatives and senate higher education committees
and the chairs and ranking minority members of the senate Finance Committee and the
house of representatives Ways and Means Committee by April 1, 2021.

(b) The Board of Trustees shall provide the following information for each institute
under its jurisdiction. The Board of Trustees shall use the Integrated Postsecondary Education
Data System (IPEDS) data submitted to the National Center for Education Statistics (NCES)
to ensure uniformity, as institutions that receive federal financial aid funding report their
financial data annually to NCES, and expense classifications are generally consistent
year-to-year and apply to institutions uniformly. The report shall include for each Minnesota
state college and university the following information:

(1) the amount and description of expenses included in the following terms as reported
in the integrated postsecondary education data system:

(i) instruction;

(ii) research;

(iii) public service;

(iv) academic support;

(v) student services;

(vi) institutional support; and

(vii) other core expenses;

(2) historical data on the amount of expenses listed in clause (1) over the previous ten
years, accompanied by a graph reflecting the figures;

(3) the current ratio of the institution's spending on institutional support versus instruction,
and the ratio over the previous ten fiscal years, accompanied by a graph reflecting the figures;
and

(4) an analysis as to whether the institution's administrative operations are growing
disproportionately in relation to its core academic functions, which may place upward
pressure on the cost of tuition and required fees, if such institution has any ratio under clause
(3) that is greater than the respective median ratio for institutions of its Carnegie classification
and of similar undergraduate enrollments. The variables in clause (3) must be used when
comparing and calculating ratios for institutions of the same Carnegie classification and
similar undergraduate enrollments.

(c) The Board of Trustees shall also provide in the report an analysis of administrative
costs at the central office and the increase in staffing over the previous ten years.

(d) The Board of Regents of the University of Minnesota is requested to perform an
audit and provide the reports as specified under this section.