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Budget Cuts in Higher Education & Behavioral Health: A Leadership Lens on Resisting the Beast

  • Nov 21
  • 7 min read

Updated: Dec 1

Disclaimer

The information presented in this analysis is drawn from publicly available sources, which may contain bias, incomplete data, or misinterpretations. This document does not claim absolute accuracy; rather, it offers a perspective on how silence and lack of proactive engagement can shape narratives and influence policy decisions. Readers are encouraged to critically evaluate the content, seek additional verification, and consider multiple viewpoints before forming conclusions.


Understanding the Fiscal Pressures


Across the United States, fiscal pressures and shifting policy priorities are forcing states to make tough budget decisions affecting higher education and behavioral health. These decisions often stem from new sources that can be biased or misinformative. The challenge arises when communication fails, leaving many in silence. From legislative stalemates affecting Medicaid funding to institutional responses in public universities, both East and West Coast states are navigating complex terrain. This analysis applies principles from The Plant of Leadership philosophy to explore how leaders can cultivate ethical growth amid fiscal adversity while resisting systemic beasts of inequity. #neverfeedthebeast


East Coast States: Higher Education and Behavioral Health


North Carolina Budget Cuts


  1. Historic Minority-Serving Institution (HMSI) Cuts:

    In May 2025, the North Carolina Senate proposed cutting over $180 million from public university funding in the biennial state budget. This includes a $9.5 million reduction in the UNC Campus Scholarship Program, disproportionately impacting Historically Minority-Serving Institutions. For instance, UNC Pembroke faces a $700,000 annual loss, while UNC A&T loses $778,000 and Winston-Salem State nearly $484,000 (Atkinson, 2025).


  2. Cost-Saving Measures at UNC-Chapel Hill:

    UNC-Chapel Hill announced approximately $70 million in operational savings, about 2% of its annual budget. These cuts include $38 million in administrative and procurement savings, $14 million from academic program alignments, and nearly $30 million in immediate cost reductions (UNC leadership, 2025). Critics argue that institutional reserves remain strong, despite justifications based on anticipated federal and state funding shortfalls.


  3. Medicaid Behavioral Health Cuts:

    In early October, the North Carolina Department of Health and Human Services imposed 3–10% reductions in Medicaid reimbursement amid budget impasses. Autism-specific behavioral health therapies faced cuts of up to 10%. Families filed lawsuits citing discrimination, leading to preliminary injunctions that halted these cuts (Clements, 2025; Spectrum News, 2025).


Together, these cuts in North Carolina indicate a prioritization of institutional cost-savings and austerity over equitable funding across education and behavioral health.


Virginia Budget Cuts


  1. Capital Project Delays:

    Governor Youngkin cut nearly $900 million from the state budget, including over $600 million removed from planned capital investments at ten higher education institutions. Renovation projects at Central Virginia Community College and building expansions at Virginia Tech have been delayed (Slaughter, 2025).


  2. Research Budget Vulnerabilities:

    Virginia's research universities face challenges due to federal funding cuts. The National Center for Science and Engineering reported that Virginia ranks 13th nationwide in R&D. However, institutions are feeling the pressure as grants are delayed or canceled due to budgeting uncertainties (Cline, 2025).


These disruptions threaten physical infrastructure growth and research continuity, risking long-term impacts on Virginia’s academic competitiveness.


South Carolina Budget Cuts


  1. Tuition Policy Changes:

    A March 2025 budget proposal suggested ending the long-standing in-state tuition freeze at public universities. Incoming students in South Carolina could face variable tuition rates determined by legislative formulas tied to inflation, while prior cohort students maintain fixed-rate tuition (WCNC & SC Gazette, 2025).


  2. Fragmented Behavioral Health System:

    South Carolina is moving forward with legislation to merge its Department of Behavioral Health, Department of Disabilities, and Department of Mental Health in a bid to rationalize services. A consultant deemed the state’s structure “the most fragmented in the country” (Chornobroff, 2025).


  3. Federal Funding Cuts:

    Federal actions have cut $11.4 billion from addiction and mental health grants during the COVID era, further destabilizing state-level behavioral health systems (Mann, 2025). South Carolina’s shifts reflect significant structural adjustments driven by both budget constraints and legislative reform, though service gaps persist.


West Coast States: Higher Education and Behavioral Health


California Budget Cuts


  1. Community College Stability, Limited CSU/UC Cuts:

    Governor Newsom’s 2025–26 budget secures California Community Colleges (CCC) funding through COLA adjustments and stabilization. No core cuts were made, though $60 million was deferred via inter-fiscal deferrals (CA Budget, 2025). However, public universities face up to an 8% reduction in ongoing support: roughly $397 million for UC and $375 million for CSU (BestColleges, 2025).


  2. FY 2026 Outlook & AI-Driven Gains:

    While California temporarily benefits from higher-than-projected revenues, partly attributed to AI-driven corporate profits, the Legislative Analyst's Office warns these gains are likely short-lived. The education budget saw a 2.8% Prop. 98 increase to $117.8 billion, though new federal cuts and obligations reduce flexibility (Petek & Chu, 2025). California thus manages fiscal ups and downs, maintaining CCC core funding while CSU/UC absorb periodic reductions.


Washington Budget Cuts


  1. Modest Funding Cuts & Student Aid Adjustments:

    Governor Inslee’s 2025–27 budget includes one-time reductions for higher education but preserves key grant programs like the Washington College Grant. Community colleges receive COLA adjustments tied to CPI, and state university faculty get negotiated increases (Ofm WA & WEA, 2025). The final budget restores funding for financial aid and avoids furloughs. Community and technical colleges receive a 3% COLA for 2025–26 (WEA, 2025).


  2. Public University Cuts & Aid Reductions:

    The proposed state budget led public universities to model 5% funding cuts, with narrower 1.5% reductions ultimately included. Some grant eligibility for private technical and nonprofit institutions was also modified (King5 & UW Impact, 2025). Washington thus achieves some austerity while protecting student support and avoiding service disruptions.


Comparative Summary


Analysis: Regional Patterns & Implications


East Coast:

Fiscal austerity is central. North Carolina’s dual reductions in higher education funding and behavioral health services reflect a broad-based approach to cost control. Virginia’s adjustments target infrastructure but also threaten research investments. South Carolina balances tuition policy reform with structural overhauls. These trends tend to shift costs onto students and marginalized groups, raising long-term concerns about access, equity, and growth.


West Coast:

Though also facing constrained budgets, West Coast states adopt a less aggressive stance. California prioritizes community colleges and redistributes deferrals, while Washington absorbs modest institutional cuts and protects public programs. Despite deep changes, behavioral health is less impacted regionally, partly due to stable state funding and fewer Medicaid disruptions.


Strategic Implications for Leaders & Stakeholders


Advocacy for Equitable Funding


In North Carolina and South Carolina, prioritizing scholarship programs and behavioral health services for marginalized populations is critical. Both regions should amplify advocacy at both state legislative and institutional board levels.


Exploring Tuition & Revenue Diversity Strategies


States should balance tuition policies to protect affordability while diversifying revenue streams like endowments, research grants, and public-private partnerships.


Investing in Behavioral Health Integration


North Carolina, South Carolina, and Virginia systems may benefit from integrated funding models to shield services from episodic cuts. Preventive investments in mental health and developmental therapy, especially with Medicaid, can yield long-term gains.


Innovative Policy Models


West Coast success with restrained, targeted budget management can inform East Coast strategies through performance-based funding, legislative safeguards, and strategic reserve mechanisms.


Ongoing Monitoring & Adaptive Models


Since cuts are cyclical, ongoing data-driven monitoring, early-warning systems, and transparent contingency plans can mitigate negative ripple effects on students and providers.


Leadership Lens: Cultivating Growth Amid Fiscal Storms


Budget cuts are systemic beasts rooted in reactive governance and inequitable priorities. Feeding these beasts through short-term austerity erodes the soil of access and mental health. Leaders must plant deep roots of advocacy and equity, branch into innovative funding models, and nurture leaves of resilience through integrated behavioral health strategies.


  • Roots: Protect marginalized scholarships and Medicaid behavioral health services.

  • Branches: Diversify revenue streams and adopt performance-based funding.

  • Leaves: Ensure student success and mental health stability through proactive policy safeguards.


neverfeedthebeast neverfedthebeast


Strategic Implications


These strategies are not just fiscal maneuvers; they are seeds for sustainable ecosystems in higher education and behavioral health. Leaders who refuse to feed the beast of inequity and short-termism will cultivate systems that thrive even in drought.


Conclusion


East and West Coast states both face the fiscal pressure of today’s interconnected socio-political landscape. East Coast states have taken aggressive cost-saving approaches through cuts, deferred projects, and spending freezes, while West Coast states exhibit resilience by protecting core institutional stability, grants, and community access.


With this stated, there are so many deficits and cuts that our economy is just as bad off as the average household with bad credit. So why is that a factor holding people back when it hasn't shut down the world yet? Moving forward, strategic actions must pivot on equity, integration, and proactive funding models. Higher education and behavioral health are fundamental to state prosperity and societal well-being. Leaders and stakeholders must build on best practices from both coasts to ensure sustainable and just systems.


Share what you have learned and your thoughts on these changes. Purchase a copy of my book today for more understanding of “The Plant of Leadership: Cultivating Ethical Growth in Leadership During Times of Adversity.”


You can receive all books and journal books for free when you book a paid session today!


References


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