From the president: Updated budget information
Last Friday, I wrote advising you of announcements from the Governor concerning possible additional budget cuts. I promised that as soon as we had the details you would know them, too. They came in last night.
Everything we have received from the State`s Office of Financial Management (OFM) is also now on line and can be found here. The news is not good.
The directions pertain to two budgets: the budget for the fiscal year we are already in (2010-11) and then separate instructions for the budget request we must submit for the biennium coming up (2011-13).
For the fiscal year we are currently in, we are asked to prepare a list of reductions as soon as we can. While we do not have a specific target for these “early action” reductions, they are to be folded into a budget that has a specific target. That is the 2010-11 supplemental budget that the Governor will ask the legislature to enact in January. Our cut in that budget: $2,950,000, to come out of the base budget for the fiscal year we are currently in.
The “early reductions” are to start as soon as possible, and will need to be reported to OFM on October 1st, as a part of – rather than in addition to – the $2,950,000.
Our proposal on how to make the $2,950,000 reduction is to be provided to the Office of Fiscal Management (OFM) on October 13th.
Our 2011-13 budget request, what the campus has been working on over the last six months, is to be submitted to OFM by September 12th, as planned. Our Trustees will act on that budget request on Friday of this week. Nothing new here.
However, by September 30th, we are to submit a new 2011-13 budget request that includes a 10% base budget (permanent) reduction. We estimate that for Western, that would be an annual additional reduction of $5,800,000. We are told we will be receiving additional instructions soon on preparing this second 2011-13 budget request.
Bottom up, transparent budgeting and planning takes time. Our budget processes are year-long efforts. We have weeks to submit a new 2010-11 budget and a new 2011-13 budget.
We may have a bit of a head start, though. That 2010-11 budget that took us all six months to complete from the bottom up included many possible reductions that were not made. So, as a point of departure, we have possibilities available that came bottom up and that have been on the web for all to see. They are, of course, precisely the cuts – among all the alternatives – that we least wanted to make.
Those previously studied options, along with any others, are further constrained by the fact that we are dealing with the current fiscal year. For this year, we have already admitted our students and signed the contracts necessary to make sure we have the faculty and staff necessary to serve them.
For the new 2011-13 budget, proposed cuts are due this September but we will not have an actual budget appropriation until May or June. We will attempt to do what we have done in the past: for the September submission, stick to the 30,000 foot level listing overall reductions (so many total positions, so many total class sections, …) but, importantly, not specifics. That allows us all to rely upon our bottom up processes next winter and spring to thoughtfully and strategically work out the least damaging specifics. It also avoids the certain damage that would be done if we get into specifics at this time and, next June when the budget is done, it turns out that not all the cuts had to be made.
Given the truncated time period, though, there must be adjustments to our usual processes. We will need to find other ways to assure full communication, transparency, and openness. We certainly will rely heavily on full involvement of governance and other leadership on campus at every stage.
The first step in openly and transparently addressing these new budget challenges will begin Friday. At their regularly scheduled Trustees meeting, we will start a discussion of the current OFM instructions, the various constraints we face on options ranging from enrollment reductions to program elimination, administrative consolidation, outsourcing, revenue increases, and such. The meetings are routinely audiocast. I encourage you to listen. While agenda times are approximate, those discussions are currently scheduled to begin around 9:00 a.m.
I have also, this morning, asked the vice presidents to begin discussions in their areas on how best to proceed in preparing revised 2010-11 and 2011-13 budgets and to then adopt and share procedures best suited to their particular areas and that are in full compliance with governance and contract obligations.
Best Case, Worst Case?
The numbers I just passed on are not some sort of “scare tactic” coming from Olympia. These are cold, hard realities. They could get worse for us – or perhaps better – depending upon how our elected officials choose from among many tough options, and from among many affected and vocal groups.
The numbers we see today are just the starting point. We have the opportunity to influence the final result. Of immediate relevance, places we can all make a difference:
· Elected officials regularly tell me that they never hear people advocating for public four-year education. Attend candidate forums and ask about what you care most about. Don`t settle for evasion. Pin people down. And remember, passion (and not facts and figures) is the great currency for political influence.
· The other great currency is currency. Money matters a great deal, and lots of small donations can add up. There are political action committees (PACs) set up that make this very easy to do. I cannot mention them here, but I expect that others who are not similarly limited will use non-state resources to let you know of options.
· There are initiatives on the November ballot that can help get the state out of its fiscal hole or bury us deeper. Make sure you understand the consequences of the ballot measures. And, if you`re inclined, talk to friends and neighbors about them. None of us can use our public positions or state resources to advocate particular positions, but we can help others understand their consequences.
As it seems I always must, it is also again time to ask for your patience. What we learned last night from OFM was helpful. But, there is a long road ahead as elections intervene, as ballot initiatives pass or do not pass, as monthly revenue forecasts are made, as the Governor decides what to do with what we are required to submit, and as the legislature decides what to do with what the Governor proposes. Uncertainty continues, but you can be sure that we will pass along more information to you as we get it ourselves.
We have already been through tough times. We have been candid about there being tough times ahead – another three years is the assumption we explicitly used last year in developing strategies to see us through those times. We are now seeing those assumptions unfold. But, because we prepared with a longer-term focus in mind and because we have not ducked the tough decisions to date, we are in a stronger position to face the upcoming challenges. And, to protect better futures for Western longer term.