Senator Steve Nass (R-Whitewater), Vice-Chairman of the Senate Committee on Universities, Technical Colleges, Children and Families, issued the following statement in opposition to a request from UW-System President Ray Cross for the Legislature to be called into special session to create a new law allowing the System to take on potentially massive debt in response to Covid-19. In the System’s request they reference a more than $1 billion line-of-credit recently created by another institution:
“The UW System like so many families and businesses faces tremendous economic uncertainty caused by Covid-19 and the illegal shutdown orders issued by Governor Tony Evers. While the UW-System has already adopted some cost saving measures, they are also still sitting on a large reserve and have access to significant resources in the numerous foundations associated with system campuses.
The massive line-of-credit would be tied to a funding source which is a common practice in issuing debt to public institutions. In the case of the UW-System, this debt would either have to be guaranteed by the state or would be guaranteed by tuition and fees. Such an action could set the course for potentially huge increases in tuition and fees on financially strapped families to retire this debt over many years.
I also fear the debt would be abused by the UW System to avoid necessary reforms and adopting further cost saving measures. It is simply too early in this economic crisis to consider drastic levels of debt for operational purposes. Such an action should only be considered as a last resort and not rushed for political expediency.”