University, System plagued by state budget cuts

 It's been a year characterized by fear and speculation as the magnitude of the budget crisis slowly comes into focus.


An ever-threatening state budget deficit has sparked the process of University realignment by choice and necessity.


In the most recent cut, the Baton Rouge campus bled $12.6 million through horizontal cuts — cuts to every division, college and department — at the beginning of the semester.

Because of this cut, the University parted with 13 employees and eliminated 153 vacant positions.


"The cut was $12.6 million that now adds up to an accumulated $43 million over a 12-month period of time," Chancellor Michael Martin said. "We have largely avoided major pain up to now, but this one was incrementally large enough that pain has come, and that is unfortunate."


While the University had already suffered some attrition, the threat of further job cuts became real to many faculty as the semester progressed. 

The University sent non-renewal notices to more than 400 faculty in February ending their employment as of February 2011.

Martin said the notices were legal preparations for the "worst-case scenario." These notices allow the University to downsize as the state appropriations dictate without fearing a lawsuit.


"I am very concerned about faculty morale," Martin said. "I can't go to every office and say, ‘I love you. Here are some cookies. I promise your life will be just fine. The sun will come up with tomorrow.'"





CURRENT CRISIS

Because of less-than-predicted state income from tax returns in February and March, the state must trim an additional $319 million from its budget before the end of June, said University economics professor James Richardson.


Gov. Bobby Jindal's plan to cover the mid-year deficit uses funds from a mandated spending freeze ordered in March.


"We will continue to do everything we can to mitigate the effects on higher education and health care," Jindal said about the budget at an April press conference. "Bottom line, though, is we are going to balance our budget both this year and next fiscal year."
Jindal's plan is being debated in the legislature.


The University's share of mid-year cuts is about $3 million, according to Jindal's plan.
The administration is projecting to meet the $3 million in required savings by freezing spending on non-academic support expenditures like travel, equipment and supplies, said Robert Kuhn, associate vice chancellor of Budget and Planning.

While the next two months could see more cuts, the next fiscal year could "set the University back a generation," Martin commented earlier in the semester.


Jindal has proposed no new cuts for higher education in the coming year.


This is a stark contrast from last year's preliminary budget, which cut higher education by $219 million.


Instead of cutting higher education, Jindal's budget seeks to draw funds from one-time sources like tax amnesty and stimulus funds.


The legislature will debate and possibly amend the governor's proposed budget throughout the summer.




THE UNIVERSITY'S AGENDA

While it's clear the state faces a shortfall totaling more than $2 billion over the next two fiscal years, most of this crisis is still based in speculation.


The speculation has driven Martin to send the notices of non-renewal to legally prepare for University-wide reorganization.


Whatever the size of the next cut, Martin said he wants to cut and reorganize programs to save the University $15 million recurring.


"We have to reorganize our resources to what we can be truly great in," Martin said. "That means we are going to offer less, but we have to refocus if we intend to remain at a flagship status."


Martin said a "rightsizing" committee composed of faculty leaders, administration and students will approve the cuts.


Martin intended to propose the cuts in this reorganization before the legislative session, but mitigating the impending mid-year cut has taken precedence.


System President John Lombardi said the system is waiting until the latest possible date to impose systematic program cuts because of the uncertain nature of state politics.


"Do we look for $100 million? Do we look for $200 million? Do we look for $300 million to be reduced in the state budget when the stimulus money goes away?" Lombardi asked state legislators in March at a House Appropriations Committee meeting.


These questions regarding the University's future will be played out at the state Capitol over the next three months.


In addition to resource reorganization, the second part of Martin's plan is coaxing the legislature to approve increases in tuition to generate $15 million recurring funds for the University.


Multiple bills in the legislature give the University authority to raise tuition.


The highly publicized LA grad Act will give the University the ability to raise tuition and fees until the fees reach the level of the University's southeast regional peers.


The Grad Act passed the House Education Committee on Thursday.


The University's fees currently rank well below its peers, Kuhn said. Combine this with the current trend of increasing tuition nationwide, and the University would be allowed to increase tuition and fees 10 percent for many years.


This would mean an increase of about $520 a year for students next semester, Kuhn said.





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Contact Xerxes A. Wilson at xwilson@lsureveille.com