Latest Round of State Budget Cuts
We now have a sense of how the university’s state funding will be affected by the State of Ohio’s latest budget bill. In short, the university (not including the hospital) will lose approximately $8 million in state funding. In addition, the hospital will lose about $1 million as a result of a new hospital assessment. Lastly, low income students who qualify for Ohio College Opportunity Grants (OCOG) will lose about $4 million in state financial aid.
To offset a portion of this lost funding, the State of Ohio has authorized public universities to raise undergraduate tuition by 3.5% for both years of the biennium. At UT, we will likely raise tuition this fall, but scholarship every dollar back to students. Beginning in the spring, however, we will not scholarship the tuition increase back to students. Raising tuition in this way allows the university to recoup approximately $2 million in lost state funding, and it preserves the university’s ability to raise tuition by the full compounded rate of 3.5% in the fall of 2010.
Beginning this week, the university will implement a process to adjust its operating budget to account for the loss of state funding. The process will be guided by the following principles:
(1) We will be transparent, seek the input of shared governance constituencies, and communicate as effectively as possible throughout the budget adjustment process.
(2) We will value and respect every employee adversely affected by the budget adjustment, and attempt to retrain and place these employees into open positions that we must refill.
(3) We will stay student-centered and patient-centered throughout the budget adjustment process.
(4) We will stay strategically focused and committed to excellence as we continue to implement the university’s strategic plan and move the university toward a brighter future.
(5) We will recognize the current economic challenges for what they are—an ongoing challenge to make the university of the future a leaner and more narrowly focused organization that continues to deliver academic quality in a dynamically changing world. This is our new reality, and it isn’t a short-term challenge—it is here to stay.
The budget amendment process will be a three-step process. First, the university will closely examine all non-revenue producing programs, non-essential support services, and all cost-saving and revenue-enhancing ideas offered by the university’s internal Finance and Strategy Committee (this committee has representatives from faculty senate, student government, deans, and administrators). Second, the university will have informal conversations with the unions about voluntarily rescinding negotiated salary increases. Third, if steps 1 and 2 are insufficient, the university will work with deans and vice presidents to reduce the workforce.
The university’s budget adjustment will be taken to the board of trustees at its August 24 Finance Committee meeting.
We will talk more about the budget adjustment process at Tuesday’s Town Hall meeting (which will be broadcast live on the Web at 11:00 a.m. Send questions to Townhallquestions@utoledo.edu). In the meantime, I want to emphasize that throughout all these difficult financial challenges, the university continues to move forward, accomplish many great things, and work to create a brighter future for students, patients, faculty and staff. I am honored to be a part of what we are doing here…improving the human condition one person at a time.
Scott L. Scarborough. Ph.D., CPA
Chief Financial Officer
July 27th, 2009at 10:19 am
Just standard operating procedures…..
July 27th, 2009at 12:24 pm
[...] Read Scarborough’s journal post here. [...]
July 27th, 2009at 6:13 pm
Hi Scott – I am wondering if there are going to be informal conversations with the upper adminnistration about voluntarily rescinding negotiated salary increases?
July 28th, 2009at 7:25 am
Hello, Susan. The decision was made that past May that administrators would not receive a salary increase in FY 2010. No salary increase was budgeted in FY 2010 for administrators–there is nothing to voluntarily rescind.
July 28th, 2009at 7:48 am
Just a few ideas to start off to help trim the shortfall, even though they may be only a drop inthe bucket:
1) Don’t sponsor fireworks (as UT did for the Toledo 4th of July celebration). It seems silly to blow money up in the sky when we don’t have money to hire people to help educate students.
2) Cut back on the media advertising. I can’t imagine that the constant media blitz on radio and TV is actually efficient in gaining enough students at this point to help to offset the dollars required for such advertising.
3) Get people to actually do the job for which they were hired and hold their feet to the fire if they do not. I see too many individuals from all classifiactions (faculty, staff and administration) not doing their jobs. They need to be held accountable for their actions.
I’ve worked the summer without pay trying to keep my program afloat. Hopefully we can all get through this but I’m not sure what else can be cut at the academic program end. We have nothing left to give here.
July 28th, 2009at 11:12 am
I applaud that you are deciding to raise tuition this fall and then to give it back to the students, great way to milk the cow whenever you please! Well guess what, even though you do not want to tap into your money, I on the other hand am going to have to tap into my emergency money and then wait for you guys to pay me back. I already was cut down 60% on my OCOG, so how is this not a financial hardship on me and other students?
If you want to claim to be student centered then maybe you should act on that and give up some of your money like we do for you. I don’t claim to be a volunteer without volunteering! Personally I am tired of giving more and more and more and getting less and less and less and then having sneaky practices put in place to gain more money.
July 29th, 2009at 10:42 am
Hillary-
Great points, but Universities are ran much like BIG Government(politicians). They do a bunch of CLAIMING, and very little to no DELIVERING. By the time you recieve any money back from this increase in tuition it will be reduced or taxed or pennies if any. They have to put some sugar in the poision to sell it to those will just say ok…I guess if your going to give it back then it’s ok. He did a good job of stating that they would not be recieving any salary increases for FY 2010, but there are probably other ways they will be recieveing monies (You have to watch the verbage or the way you ask something).
July 29th, 2009at 10:45 am
Don’t get me wrong I have enjoyed my time here at UT, but it is getting ridiculous on the cost of tuition. Now I know you can’t put a price tag on knowledge, but when governments ONLY solution to EVERYTHING is….well let’s just raise fee’s, taxes, cost of business, etc. then you know it’s not about the PEOPLE.