In concurrence with Gov. Matt Bevin’s budget, the Kentucky State Senate voted Wednesday to cut funding to institutions of higher education, and to include a partial system of outcomes-based funding for state universities.

The heavily Republican body passed the proposal by a 27-2-9 margin, with all Republicans voting yea, and all but two Democrats abstaining from the vote. This budget sharply counters the plan passed by the House of Representatives, which restored all of Bevin’s cuts to public universities along partisan lines.

The budget set aside $1.19 billion over the next two years to the Commonwealth’s ailing public pension systems. This is accomplished by making sharp cuts to state agencies and higher education.

Under Bevin and the Senate’s proposals, UK will receive a $25 million reduction in state appropriations, according to an email from President Eli Capilouto, which is a 9 percent cut to UK’s state funding. 

“I am grateful to the members of both parties in both chambers for their efforts to craft a budget in the face of challenging constraints; and their willingness to listen to our story throughout this process,” Capilouto wrote in his email. “Our story continues to be that if we hope to position our Commonwealth to be a national leader in workforce development and economic prosperity, we cannot sacrifice critical investments in the engine that drives the state’s important transformation — our colleges and universities.”

While the plan is a setback for UK, the process still has a ways to go, as members of both the House and the Senate will meet in a conference committee to work out their disagreements. They will then send a compromised budget to the governor, who has the power to veto it. Bevin promised in January to veto any budget that is not similar to what was originally proposed.

In addition to the cuts, another item related to education spending could have a dramatic effect on UK’s operating budget. Heeding the governor’s call to reward taxpayer dollars to universities based on merit, the Senate budget includes a provision to allow schools to compete for 25 percent of postsecondary dollars based on academic performance, according to Capilouto’s email. Starting in fiscal year 2018, this funding will be allocated on performance-based metrics, including graduation and student retention rates, among other things.

While Capilouto has not taken a firm stance on outcomes-based funding, he has both acknowledged the role the new potential system could play, while expressing skepticism in the current proposal. At a committee meeting dedicated to postsecondary education funding, Capilouto said Bevin’s plan would bring “uncertainty” to the process.

Although it is currently unclear what UK’s funding levels will be for the next biennium, leadership of the Democratic-controlled House remain adamant about restoring Bevin’s cuts to UK and other universities. The legislature has until April 12 to override any potential vetoes by the Governor, but the session can run until April 15 if legislators need more time.