Budget update
March 5, 2015
Budget update March 4, 2015From Chancellor Brian Rogers
As I mentioned to governance groups earlier this week, this year’s budget is the toughest I’ve seen since 1986. The governor and the legislature have the daunting task of figuring out how to address the state’s $3.5 billion budget shortfall.
Initially, we based our projections on Gov. Bill Walker’s proposed budget, which reduced overall UA funding by $9 million. Last week, the House Finance Committee's University Subcommittee last week, chaired by Rep. Tammie Wilson, proposed reducing the UA budget by an additional $25 million, which would result in a reduction of about a $34 million. In addition, the subcommittee report did not include continuing funding for maintenance ($1.1 million) or student academic advising ($400,000), both funded as one-time-only items in the current fiscal year’s budget. The effects of the proposed reductions would be compounded by increased systemwide utility costs ($6 million), personnel costs ($18 million), and other fixed costs ($5 million).
Within these numbers, the House subcommittee’s report reduced travel by 50 percent. Travel reductions at this level will have a tremendous impact on student recruitment, athletics and all programs requiring site visits.
The House Finance Committee is taking public comments through tomorrow could make changes based on what it hears from constituents. The committee is expected to complete its budget markup next Tuesday.
The Senate has started work on its version of the budget; its action will follow full House approval of the budget. Once both bodies have finished their versions of the budget, they will work to merge those into a final version near the end of the legislative session in April. It’s hard to say exactly where we’ll end up. I think we can consider the governor’s budget the best case scenario and the House subcommittee’s proposed budget the worst case.
To manage, we’re continuing our review of programs and looking for ways to cut costs. The academic programs under special review have moved to the administrator committee. It will provide recommendations to the Chancellor's Cabinet. The target date for cabinet decisions is April 3. In most cases, savings due to cuts to academic programs won’t be realized right away because we’ll need to allow current students to finish their degrees before phasing out programs.
We’ve recently completed three non-academic program reviews: Summer Sessions and Lifelong Learning, eLearning and Distance Education, and farms and large animals. Information on those reviews is available online at www.uaf.edu/finserv/omb/uaf-program-reviews/completed-program-reviews/.
Our internal reviews won’t solve this problem alone. We have some difficult choices ahead. We will be asking if people want to volunteer for furloughs, reduced contracts or reduced hours, and we will likely have layoffs as well.
I will tell you that we did make it through challenging times in 1986 and we’ll make it through this. I appreciate all the work you’ve been doing to continue to serve our students, community and state.