Portland State University administrators Lindsay Desrochers and Roy Koch presented a draft University budget plan for the 2011-2012 fiscal year at a pair of campus sessions on May 11, 2011, that drew approximately 175 faculty and staff members.
The budget, prepared by the University Budget Team at the request of PSU President Wim Wiewel, addresses a projected shortfall of $29.4 million for the coming fiscal year, which begins July 1, 2011. That amount includes a state funding shortfall of $23.7 million for 2011-2012, based on the costs of current services at PSU, and projected cost increases related to state health care (between 9% and 10%) and retirement plans. The remaining $5.7 million shortfall reflects proposed strategic investments into University programs and services (based on $15.3 million in requests University-wide).
To bridge that gap was "no small chore," said Lindsay Desrochers, vice president for finance and administration. It took wide-ranging cuts, tuition increases, and identifying possible funding contingencies. The process reflecting months of planning and recommendations, including input gathered at a campus-wide budget forum held March 1.
Academic and administrative units were required to take a permanent 3% budget cut, and to return 30-40% of fund balances carried over from the 2009-2010 fiscal year.
Additional funds will be generated through proposed tuition increases of 9.2% for undergraduate resident students, and 6% for graduate and non-resident students. The University will also increase administrative overhead for academic units (from 16 to 18%) and for auxiliary and self-support units (from 18% to 20%).
Faculty and staff members in attendance voiced concerns on a broad range of issues, including impacts of restructuring the Oregon University System and of shifting to a block grant funding model; reconciling higher costs to students with the role of financial pressures in student attrition; and whether employees will be asked to make greater contributions to retirement and health care plans.
An overriding theme for budget management and strategic reinvestments was the need to improve enrollment management: to ensure that entering students are prepared for the rigors of college, preserving services for incoming students, providing students adequate advising during their time at PSU, and that students progress through their programs in a timely manner.
Selected reinvestments for 2011-2012 include:
- Student Affairs: $475,000 for a new customer relations management software system and operators, which will improve enrollment management and retention;
- Research and Strategic Partnerships: $410,000 for additional research support and a new grant submission system;
- Information Technologies: $148,000 to manage increased technology demands and staffing shortages;
- University Advancement: $91,101 (and a one-time $75,000 contribution) to prepare for an upcoming fundraising campaign;
- Academic Affairs: $47,000 for increased staffing to support student success, including "final mile" issues of those students close to but falling short of graduation;
- Office of the President: $50,000 for equity and diversity initiatives and administrative support.
The College of Liberal Arts and Sciences drew the largest reallocation: $4,381,000—an amount that prompted questions from the audience.
Roy Koch explained that the College had become over-extended financially. At the same time, the College generates the majority of student credit hours at PSU, and its programs in effect underwrite other academic programs that are more expensive to provide. This is common practice at public universities, which maintain equitable access to all degree programs by offering each at a comparable price. "You don't want your business and engineering programs to only be available to upper-middle class students," Koch said.
The nearly $4.4 million reallocation will enable the College of Liberal Arts and Sciences to maintain its growing enrollment, while installing "adequate budgetary management" for what is the largest academic unit at PSU, Koch said. He emphasized the importance of rectifying these issues prior to the hiring and installment of a new dean for the College (a national search is underway).
The 2011-12 draft budget proposal is contingent on two unresolved factors:
- State Legislature and Oregon State Board of Higher Education approval of tuition increases—9.2% for undergraduate resident students, and 6% for graduate and non-resident students;
- Final state allocation for higher education for the 2011-2013 biennium.
Though unlikely, additional funds could be available if enrollments exceed projections. In that case the University would consider nearly $10 million in unfunded budget requests.
The University Budget Team will now compile feedback from the hearings and submit a final budget plan to be approved by President Wiewel.
Copies of all budget documents, including budget reductions, requests, and reallocations, are available at the Budget and Planning website:
http://www.pdx.edu/budget/2011-2012-academic-budget-process. Any budget-related comments may be submitted to firstname.lastname@example.org.
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