The biggest increase in state funds for higher education in the past four years will let more students into Utah colleges, but there won't be any cheering over the 3 percent faculty-staff pay raise.

Higher education will receive a $12.6 million, or 4.85 percent, increase. That's the largest increase in state funds to higher education since the 1985-86 budget and compares to a $2.2 million, or .86 percent, increase in state funds last year.Of higher education's total budget of $367.7 million, $272.2 million will come from state coffers.

Higher Education Commissioner Wm. Rolfe Kerr credited an improving state economy for a brighter financial package. "There was the positive prospect of some additional resources that hadn't been there in the past three years," he said.

But the 1989 legislative good news may be overshadowed by discontent over a faculty pay raise that doesn't keep pace with inflation.

"They will view this as another reduction in pay, but it would have been disastrous if benefits had been cut, too," said Dixie College President Doug Alder.

He was referring to the decision to fully pay higher education's $3 million increase in insurance costs. The legislators disagreed with the governor's recommendation to cover only half of that increase.

Jewell Rasmussen, executive secretary of the Utah Association of Academic Professionals, which represents 750 of the state's approximately 2,000 college faculty, said the pay raise is disappointing because it follows three years of no new state money for salaries.

He said his organization will ask the State Board of Regents, probably next month, to downsize the state's higher education system rather than to continue operating it with inadequate funding.

Higher education officials are pleased about enrollment growth and research appropriations, even though the final dollar figure still leaves 1,041 students unfunded.

Last year, legislators funded enrollment at 650 new students. The 1989-90 budget has room for 1,697 more students to enter Utah colleges. "That is the brightest news for Snow and the other small colleges," said Snow President Steven Bennion. Snow experienced a 13 percent enrollment increase last year.

Legislators also increased reimbursed overhead - the amount research grants reimburse colleges for indirect costs. Because of fiscal restraints, the colleges have surrendered 24 percent of their reimbursements to the state's general fund. The 1989-90 budget will reduce that to 7 percent.

Utah State University President Stanford Cazier believes this decision recognizes research's role in the state's economic development.

Another investment in economic development will be $1.5 million for upgrading and expanding engineering, nursing, medical sciences and biotechnology and short-term, intensive training for vocational education.

Among items in a $3.99 million, one-time supplemental appropriation will be library acquisitions and equipment, connecting Dixie College to the state's educational television network, U. animal care facility, Salt Lake Community College's maintenance of South High campus, increased fuel costs at Utah Valley Community College and Southern Utah State College theater equipment and Dixie College's Dixie Center lease.

Highereducation's allocation

Higher education will receive:

- A $12.6 million, or 4.85 percent, increase in state funds.

- Enrollment growth of 1,697 students.

- Increased share of reimbursed overhead for research.

- A $1.5 million economic development investment.

- A $3.99 million supplemental appropriation.