New State Policies

T HE financial administration of state universities, teachers' colleges, normal schools, and other types of institutions is undergoing a significant change as a result of the adoption of new policies by state legislatures in providing funds for their support. Just prior to the depression period, it was the general practice of state legislatures to allow the individual institutions fixed amounts of state funds for their use covering an annual or biennial period. These amounts were paid out of the state treasury directly to the governing boards or on their order. In the expenditure of the state funds, the governing boards with the assistance of the presidents of the institutions had more or less free rein in the administration of their fiscal affairs. Within the recent past, however, many state legislatures have revised the methods of distributing state funds to the institutions as well as the other executive offices, departments, commissions, boards, and agencies of the state. Since financial administration is dependent upon control, the effect has been that the legislatures have deprived the governing boards of a considerable measure of administrative authority over the finances of the institutions and have virtually assumed this administrative responsibility themselves. The purpose of this article is to show the present policies of the legislatures of the several states in supplying state funds for the support of their universities and colleges with special reference to the effect on their financial administration and management. Sources of the information are the most recent appropriation acts and other statutes enacted by the state legislatures appropriating funds for the support of their state universities and colleges. The plans by which the states commonly finance their institutions may be classified as follows: by making appropriations to them for annual or biennial periods at the regular sessions of the state legislature, and by setting aside for a continuing period the annual proceeds from special taxes levied for their particular use. By far the majority of the states employ the first plan of annual or biennial appropriations. There are twelve states where the second plan of setting aside the proceeds of special taxes is wholly or partially utilized

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