Higher-ed panel of legislators told of savings option.

Arkansas spends less than most other states on instructional expenses, student services and academic support, but more on institutional support, including administrative costs, according to an analysis of public universities and colleges by a state official.

The data was prepared by Brett Powell, director of the Arkansas Department of Higher Education, and presented to lawmakers at a Legislative Task Force to Study the Realignment of Higher Education. Powell’s analysis looked at the categories as a percentage of total budgets.

Administrative expenses have been an area of focus for members of the task force, which exists to consider how higher education is structured in the state, look into redundancies and find cost savings.

Rep. Mark Lowery, R-Maumelle, who drafted legislation to merge the University of Central Arkansas into the Arkansas State University System before deciding against introducing it last year, is a co-chairman of the task force.

Powell said the state spends more on administration than the national average because its institutions are smaller.

Increasing enrollment at each institution would reduce per-student expenditures, but, besides getting more people to go to college, Powell said colleges and universities could adopt a shared-services model.

That would mean schools would share purchasing power and consolidate some divisions — such as human resources, information technology and finance.

“The efficiencies don’t naturally occur within systems until a shared-services model is implemented,” Powell said. “Some efficiencies occur naturally just by institutions joining systems, but greater efficiencies occur when there is a combination of administrative functions.”

Partnerships between schools can take advantage of economies of scale without necessarily being in the same system, Powell said.

He cautioned lawmakers to avoid focusing on national data to analyze Arkansas schools because the state has unique needs. Nationally, state governments are both building university systems and breaking them apart.

Lowery asked if administrators could teach in order to reduce institutional support costs. Powell said they could — so long as they meet teaching qualifications.

Public universities and colleges in Arkansas spend 34 percent of their budgets on instructional expenses, 5.7 percent on student services, 7.7 percent on academic support and 13.4 percent on institutional support.

Nationally, institutions spend 37 percent of their budgets on instructional expenses, 6.8 percent on student services, 9.7 percent on academic support and 10.5 percent on institutional support.

At the end of the meeting, Lowery invited college and university leaders to testify at future meetings on how they believed their schools should be governed.

“It could be an argument for why remaining independent is more beneficial for the students and for the institution,” he said.