Sunday, November 29, 2009

UNO budget forum sheds little light on cuts

University of Nebraska at Omaha Chancellor Jon Christensen provided little detail, but said the current budget crisis is “unprecedented,” at the UNO budget-cutting forum on Nov. 19, 2009.   

“We are in a new territory as a campus, in terms of the magnitude of the challenge,” Christensen said.  “I would not be truthful if I said this is like what we would have to deal with in the past, because its not.”

Christensen said he did not have any specifics from central administration or the Board of Regents and would not receive any “system-arching orders” until January but still wanted to hold the forum to keep the process as transparent as possible. 

“The forum had been planned with the assumption the Legislature special session would be over, but that’s not the case,” Christensen said.  “But we will share the information as we promised all along, for you to know what we know.” 

Christensen, accompanied by Terry Hynes, senior vice chancellor of academic and student affairs and Bill Conley, vice chancellor for business and finance, said they had few specifics about the cuts, but provided several scenarios and options in dealing with the cuts, as well as the reasons behind the shortfall.

Cause of Budget Cuts
September 2009 net tax receipts were $40 million, or 11.2 percent below the Nebraska Economic Forecasting Advisory Board’s April 2009 forecast. For the first three months of the current fiscal year, net tax receipts were down $57 million, or 6.5 percent from the forecast and down $68 million, or 7.6 percent from the 2008 actual, according to the UNO Budget Advisory Task Force Web site.   

In addition to the $2.2 million shortfall in 2010 and $2.7 million shortfall in 2010, UNO faces an additional $3.8 million in cuts over the biennium—two-year-fiscal period—per the recommendations made Gov. Dave Heineman.  Heineman recommended $1.4 to be cut in 2010 and $2.7 to be cut in 2011.

The Appropriations Committee, however, recommended a slightly lower number for UNO cuts, suggesting $1.4 million in 2010 and $2.4 million in 2011, a slightly lower total the Heineman recommendations.

A significant portion of the shortfall comes from the pending increases in salaries.  UNO is looking at funding a 1.5 percent pay raise for all faculty, with a 3.8 percent pay raise for all AAUP (American Association of University Professors) faculty, something Christensen said could greatly affect the process.  

“It (the salary increase) could be maintained, reduced or all-together eliminated, and I don’t know whether or not this will happen,” Christensen said.  “But that would have huge impact as we move forward.”

Everything is on the Table
            Christensen presented a list of possible strategies to resolve the budget issue:
            Early retirement agreements
            Maximizing workload productivity
            Continued restraint in hiring
            Shifting from full time to part time staffing where feasible 
            Reducing part‐time and/or temporary positions
            Voluntary reduction in hours worked
            Operating budget savings, such as travel
            After presenting the strategies, he emphasized the uncertainty with these strategies.  

“There is nothing written in stone, but at this point in time, everything is on the table,” Christensen said.  “Whether they are realistic or possible, until we determine that it is unrealistic or impossible, everything needs to be considered; there is no agenda, there is no priority.”

Christensen said although he cared about access and the financial load students carry, it was his “personal hope” the Board of Regents would consider a tuition increase and suggested the recent 4 percent hike was not high enough.

He said instead of 4 percent, if the regents raised tuition to 6 percent it would be an additional $4 million off of the entire NU system shortfall, and if it went to 8 percent, it would reduce the deficit by $8 million. 

“That is a slippery slope, because we have been very competitive, we want to provide access, as many of our students are first generation, underrepresented students for whom the fiscal challenges are many and are great, and we don’t want to take anyone out of play,” he said.  “At the same time, the state revenue continues to trend down and we have to have to have a sustainable operation, so that’s the end of the day.”

 The UNO Budget Advisory Task Force will hold a meeting on Dec. 2, which is meant to further explain the situation and to provide any new details or information regarding the budget, specifically regarding the special legislative session that adjourned Nov. 20. 

After Jan. 1, efforts to address the fiscal 2011 shortfalls will be made, which Conley said concerns him more than the current situation. 

“The challenge for the next biennium looks possibly and likely worse as the federal stimulus dollars come in and are no longer gonna be available and will need to be replaced in some fashion,” he said.   “So, what’s more concerning to me, is two years out. “

Christensen, Hynes nor Conley offered any specifics on how these strategies could or would be implemented, but did stress the decentralizing of the decision-making process. 

Both Christensen and Hynes said it was important to empower deans and supervisors in particular units to put forward recommendations, rather than “something coming directly from Eppley.”

“We are trying to do our best to keep decision making decentralized where we can do that, so that we’re not making decision at just the Chancellors level or at the VC level.”  Hynes said.  “We are trying to make sure that the college level retains the ability to be able to make the decisions that are in the best interests of the colleges, of the other units on campus, so we can move forward in the best possible way.

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