Area college, university officials bracing for cuts

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December 1, 2008

Anonymous The Joplin Globe Mon Dec 01, 2008, 10:09 PM CST

By Melissa Dunson

mdunson@joplinglobe.com

Area colleges are tightening their belts to brace for projected state budget cuts over the next two years.

Bruce Speck, Missouri Southern State University president, on Monday announced a campuswide moratorium on travel and hiring.

“I know people don’t like the word, but I think we’re looking at entrenchment, and preparing the university to survive in this kind of climate and then be ready for when the economy changes,” Speck said. “We realized it was time for us to be prudent.”

Educators started to brace for the shortfall last summer, when lobbyists’ reports predicted that the state budget could be as much as $200 million short. Kyna Iman, MSSU’s government lobbyist, told the Board of Governors in September to prepare for any new programs to be put on the chopping block.

Alan Marble, president of Crowder College in Neosho, said his administrators started budget analysis last fall after a report from a lobbyist. The school is working on plans for how to handle a potential 5, 10 or 15 percent budget cut.

The plans contain cost-cutting measures such as restricting travel and professional development, slowing down replacement schedules for lab and computer equipment, and delaying building improvements. Marble said he also is not immediately hiring to fill vacant positions.

“A 5 to 10 percent cut we can absorb,” Marble said. “But a 15 percent cut, and we’d have to go back to the drawing board.”

It’s just the latest action that colleges and universities across the state are taking to prepare for the potential cuts. Last month, the University of Missouri system suspended all hiring, and local newspapers reported that officials at Missouri State University in Springfield and Missouri Western State University in St. Joseph were preparing their departments for 5 percent budget cuts.

‘Looking bad’

Missouri legislators won’t offer specifics on final budget numbers until after the first of the year, but state Sen. Gary Nodler, R-Joplin, chairman of the Senate Appropriations Committee, said the initial estimates aren’t good.

The state’s current budget was approved before the economic meltdown started in September, and the bottom line was set with the projection of a 3 percent growth in revenue. But the state hasn’t seen that gain. Instead, it’s looking at a more than 4 percent drop in revenue compared with figures from the year before, mostly because of losses in corporate and sales taxes, Nodler said.

The 3 percent growth that never came and the 4 percent loss combine for a 7 percent difference between the dollars the state thought it would have to work with in 2009 and what it actually will have. Even with 3 percent of wiggle room worked into each department’s budget annually, the shortfall looks to be a 4 percent loss at the very best.

Things could get worse too, Nodler said, if the stock market continues to show losses through the end of the year and capital-gains taxes become nearly nonexistent.

“Things are looking bad,” Nodler said of the budget. “There is a slim possibility that we may not have to make the overall cuts, but it’s too early to tell if there will be any additional withholdings for 2009, and we haven’t even met with the governor yet to agree on a revenue figure for 2010.”

Nodler said the Senate Appropriations Committee has asked that all state departments go through a series of exercises to determine how they would deal with budget cuts of 10, 15 or 25 percent. He said no such memo has been sent to the state’s higher-education institutions, but that preparing for budget cuts is a wise step.

“We are in a deficit-spending picture based on the balance that we started with and the money that we’ve committed to give,” Nodler said.

Nodler said whatever the final budget figure is, he does not expect higher education to bear the full brunt of those cuts like it did in 2001 and 2002. The schools won’t even regain those pre-budget-cut levels until next year.

Clouds in Sunflower State

Higher-education institutions in Kansas are facing a similar plight. John Patterson, vice president for administration and campus life at Pittsburg State University, said Gov. Kathleen Sebelius recently recommended that agencies prepare for a 3 percent budget cut this year. Patterson said that would be a $1.2 million cut to PSU’s current budget.

Those budget cuts could reach closer to 7 percent in 2010, Patterson said.

He said PSU is looking at reducing travel, utility costs and equipment purchases, and not filling vacant positions to help cut costs this year.

After Jan. 1, Patterson said, the tuition committee will have to consider whether to raise tuition again to help make up the difference.

Oklahoma college and university officials also have been noting declines in enrollment and concerns about budgeting in the wake of the downturn in the economy.

Budget work ahead

State Sen. Gary Nodler, R-Joplin, chairman of the Senate Appropriations Committee, said higher-education institutions may not know about midyear cuts to the 2009 budget until April. The original 2008-09 budget for Missouri that was signed last summer was for $22.4 billion, including $27 million in new dollars for higher education.