Title: Alabamas universities have experienced the largest state funding cuts in the nation' USA has address
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2Alabamas universities have experienced the
largest state funding cuts in the nation.USA
has addressed the economic downturn with minimal
impact on employees and programs.
3Current Year Appropriation
Initial Decrease from 2008 17.8 million
Recent Proration 11.0
_____ Total
2009 Decrease 28.8 million Down 20.6 from
1 year ago.
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579.3 81.6 83.4 84.2 86.7 101.2 120.4
139.7 110.9 107.6 (????)
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
6Division budgets compared to net state
appropriation (in millions) 2008-09
Budget Approp. OM
163.9 69.2 College of Med.
97.3 30.0 Hospitals
317.0 9.6
7University Budget, 2008-09 (includes College
of Medicine excludes hospitals)
8University budgeted exependitures (in
millions) 2008-09 Budget
Approp. OM 163.9
69.2 College of Med. 97.3
30.0 TOTAL 261.2 99.2
9 University Expenditure detail Salaries and
benefits 196.5 million Fixed Costs
25.8 million Others
38.9 million TOTAL 261.2
million
10- USAs monthly expenditures
- Salaries
- 13 million
- Health insurance, retirement, other benefits
- 3.6 million
- Utilities
- 900,000
11University Revenue Sources (in millions)
2007-08 Net State Appropriation 124.5
2008-09 Net State Appropriation 99.2
Net appropriation decrease (25.3)
Tuition and Fees
78.9 Other
70.7 (Sales of clinical and
educational services, interest income,
grants overhead, and misc.)
12 Addressing the state funding
shortfall University (in
millions) Appropriation reduction
(25.3) Additional expenditures
(9.6) Budget shortfall
(34.9) Additional tuition and fees
11.5 Budget reductions 21.1 NET
(2.3 million)
13- Summary of Budget Reductions
- (in millions)
- Personnel 5.7
- Operating budget cuts 5.7
- Departmental Reserves 9.7
- Total 21.1
14Cost Reduction Measures
- Equipment Personal Computers
-
- 2) Travel
- 3) Cell Phones
- No Across-Board Salary Increases
15- Position Freezes
- Staff Reclassification Freeze
- Temporary Personnel
- 8) Overtime Pay
16Personnel Cost Reduction 5.7
million Equivalent to 120 positions held open.
17Why not re-direct construction funds? 1. bond
issue proceeds, private gifts, federal grants,
etc., cant be used for other expenses 2.
construction costs are down due to economy 3.
difficult and costly to halt construction
projects already in progress bid issue, site
damage, etc. 4. we NEED the buildings to support
programs
17
18Revenue Measures 1) Increased enrollment 2)
Increased tuition 3) Stimulus?
19- Projected Stock Market Impact on
- Endowment Proceeds for
- Student Scholarships and
- Faculty Chairs/Professorships/
- Academic Support
- 2008-09 3.96 million
- 2009-10 2.40 million
- Reduction (1.56 million)
20USA compared to other organizations affected by
the economic downturn 1. Demand for USAs
products is going up, not down. 2. USA needs to
retain employees to address this demand.
21- Summary
- Keys to USA addressing current years cuts
- 1) conservative management over time
- 2) cooperation of academic and administrative
departments in reducing expenditures - 3) institutional growth brought about by
confidence in USAs programs
22 Looking Ahead
23State Appropriations (in millions)
- Net reduction, 2008-2009 28.8
- (20.6 )
- Proposed reduction, 2009-2010 3.25
- (2.9 )
- __________________________________________________
_______________________________ - Net reduction, 2008-2010 32.1
- Assumes no further proration this year or next.
24Stimulus Payments
- 2009-2010 10.9 million
- 2010-2011 10.9 million
- 2011-2012 0
- Stimulus goes away in 2011.
25Impact of Stimulus(in millions)
- 2008-10 Net State Funding Reduction 32.1
- Stimulus
10.9 - 2008-10 Net Funding Reduction 21.2
26Variables
- Increased retirement costs due to stock market
- Increased costs such as utilities, operations,
benefits, health care - Reduction of endowment due to stock market
- Tuition Rate (?)
- Enrollment (?)
27 USAs plan 1. Assess developing trends in
the business cycle 2. Allow appropriate time to
better understand true economic outlook 3. Remain
conservative 4. Prepare to adjust/react 5.
Resources Planning Committee 6. Jagcents 7.
Sustain our programs
27
28- Budget Milestones for 2009-10
- 1) State funding finalized May 18
- 2) Tuition rate determined June
- 3) University budget finalized September
- 4) Enrollment numbers September
- 5) State funding outlook as academic year
progresses
29Final thought The latest and best information
will enable the most successful long-term
decision making.
Questions?