Arizona Universities Receive Financial Boost from Remaining COVID Funds
In an unexpected turn, Arizona’s state universities are set to receive a financial boost as Governor Katie Hobbs allocates approximately $16.5 million from surplus COVID relief funds. These funds will counteract the budget cuts agreed upon earlier this year. Northern Arizona University is among the beneficiaries of this financial reprieve.
Despite having previously agreed to an $18.3 billion budget with a 2.5% budget cut impacting several state entities, Governor Hobbs has opted to tap into the unused federal funds from the American Rescue Plan Act. Originally distributed in 2021, this fund was intended to alleviate pandemic-related challenges for state and local governments.
According to legislation, these funds must be allocated by the end of 2024 and spent within this year. However, questions linger about the original allocation of these funds and the timing of their reallocation. Governor Hobbs’ spokesperson, Christian Slater, withheld details about these decisions but dismissed any suggestions that the timing was politically motivated, coinciding with her upcoming reelection campaign.
“As the governor has always said, she is committed to doing what’s right for Arizona and putting politics aside,” Slater stated.
Initially, Republican lawmakers proposed a 5% permanent cut for most state agencies, sparing essential services like Medicaid and law enforcement. This would have amounted to a $38.9 million cut for the universities. However, Governor Hobbs managed to reduce this to $16.5 million, which has now been fully restored with ARPA funds.
The recent financial allocation includes nearly $8.1 million for Arizona State University, more than $4.7 million for the University of Arizona, including $1 million for its Health Sciences Center, and over $2.6 million for Northern Arizona University.
Republican legislators justified the cuts by pointing out that universities receive substantial funding from grants and contracts, including international sources. They argued that the universities’ reliance on out-of-state tuition revenue supports their financial stability. Kingman Republican Rep. John Gillette remarked, “This is big business. If they’re going to remain big business, then they don’t need state money.”
In defense of the budget, Peoria Republican Rep. David Livingston noted the temporary nature of the cuts and the universities’ substantial budgets. “These universities have multi-billion-dollar budgets,” he said.
While other state agencies continue to face budget reductions, the decision to allocate the entire $16.5 million from ARPA funds to universities underscores Governor Hobbs’ commitment to higher education. “The governor is committed to protecting our state universities and ensuring that they have the funding they need to give Arizonans opportunities to thrive and deliver a strong workforce for entrepreneurs looking to start and grow their businesses in Arizona,” Slater added.
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