U. announces major cutbacks To cut 300 faculty, staff; stop most construction in response to Casey budget

Administrators announced major across-the-board cuts yesterday for the 1992 fiscal year in response to a possible sharp reduction in state funding. The University will likely run a $6 million deficit in next year's budget despite cutting at least 300 faculty and staff positions and postponing almost all building projects not already underway, administrators said. The deficit projection is the first in 15 years. And while financial aid funding will increase as planned next year, less money than usual will be added to the financial aid budget in 1993. In addition, the University's "need-blind" admissions policy could be scrapped in the future. These proposed measures, announced by the University in two open forums and at University Council yesterday, are in response to Governor Robert Casey's proposed $18.6 million cut to University funding. Administrators say they planned this year's budget assuming the University will not receive this money and planned for the possibility the University might eventually lose all state funding. "We have assumed the governor will have his way . . . and assume, in future years, the other 50 percent is at risk," President Sheldon Hackney said. It still remains unclear whether Casey's budget will be accepted by the state legislature. The University must pass a budget anticipating the cuts because in past years, the state legislature has not decided on the University's appropriation until well after July 1, the beginning of the fiscal year. Officials said the budget plan aims to reduce the amount of money spent while not harming the University's "core academic mission." It also attempts to distribute budget cuts across the University, administrators said. Budget Director Stephen Golding said the University wanted to reshape the budget by cutting expenses rather than raising tuition. The administration will request the Board of Trustees' approval of a 6.9 percent tuition and fees hike for undergraduates for next year at Friday's Budget and Planning Committee meeting. Despite the fiscal problems, the proposed budget is larger than last year's. The University projects a 5.4 percent growth in its budget, Golding said. The administration had planned on an eight percent growth in this year's budget until Casey announced his cuts. Excluding the $6 million deficit, the University has only a 3.4 percent budget growth. Golding noted that the budget will grow slower than inflation, meaning it will actually decrease in real terms. Provost Michael Aiken said faculty salaries will increase between four and five percent over last year -- lower than the six to seven percent increase the University had originally projected. Cutting 300 faculty and staff members by the end of the next fiscal year is part of a combination of cuts to schools and to administration. These cuts will come from not replacing retiring and departing faculty and staff, reassigning faculty and staff where they would be more productive, and laying off some staff members. Administrators say they cannot yet predict where these personnel cuts will fall. Hackney said it would be up to school deans whether they replace professors on leave, saying they are not always replaced currently. He added that he was "extremely reluctant" to request the budget deficit, saying it would be the most difficult part of the budget for the Trustees to accept. But he and other administrators said it would enable the University to avoid unnecessarily hurting academics. "It's better to make [budget cuts] with a scalpel than a meat-axe," Aiken said. Officials said the suspension of building programs is a contingency against continued cuts in state funding. Projects that will be delayed include the Law School's new library, renovations to Kings Court/English House, new headquarters for University Police, a proposed University-owned power plant, the campus center and repairs to College Hall. Three construction projects will proceed as scheduled: renovations to Logan Hall, renovations to the Evans Building at the Dental School and the construction of the Institute of Advanced Science and Technology. The Evans and Logan renovations will continue because they are already well underway, administrators said, and the IAST, which is not scheduled to break ground for another two years, will proceed so the University can meet government expectations for funding. Golding said the administration had a nine-point strategy for making up the $18.6 million in proposed state funding cuts. According to Golding: · The University as a whole will run a $2 million deficit, which it will cover by using cash reserves held in the University's bank. · The School of Veterinary Medicine will run a $4 million deficit, which will be made up from the same cash reserves. · The administration will cut its budget growth from five percent, as originally planned, to two percent, saving $4 million. Some of the cuts in staff will fall under this category. Computing, security and the library system are exempt from these cuts. · Individual schools and research centers will cut their budget increases by .7 percent each, a proposal which will save the University a total of $2.4 million. Some of the cuts in faculty and staff will also fall under this category. · The Vet School will increase revenue or cut programs to make up $1.1 million of the school's proposed state funding cuts. · The Medical School will either increase revenue or cut programs to make up the proposed $1.4 million cut in state appropriations. · The Dental School will either increase revenue or cut $160,000 from its budget to make up for the proposed reductions. · The University will gain $725,000 by increasing undergraduate and graduate tuition and fees. · The Provost's Subvention Pool, an account which funds several long-range academic projects, will be cut by $2.8 million. Administrators said managers in different schools and divisions would make decisions on how they would cut faculty, staff and programs, but five programs in the provost's Subvention Pool have already been earmarked for suspension or revenue freezes. · Graduate fellowships will be frozen at this year's level of $6.5 million. · The Research Foundation will be frozen at this year's funding level of $1.1 million instead of being increased to $1.3 million. · The half-million-dollar Undergraduate Initiatives Fund, which funds outstanding proposals for undergraduate research, will stop funding projects. · New financial commitments to the Trustee Professorship Fund, which creates professorships, matches professor salary offers, and offers the provost a general salary reserve, will be stopped. · A Social Sciences Research Institute, which the University had said in its five-year plan it wanted to establish, will be postponed. Administrators added that despite their intentions to preserve academic quality, some academic programs would be affected, particularly those which encouraged excellence in its students and faculty. One goal for planning this year's budget, Budget Director Golding said, was to retain "need-blind" admissions policies. Under this system, students are admitted to the University without consideration of their ability to pay, while Student Financial Services creates a package of loans, grants and work-study funding so students can attend. But Hackney said he "cannot promise" the need-blind admissions policy will continue indefinitely, although he stressed the University has not made a final decision to drop it. He outlined several possible ways to decrease the burden on financial aid, including placing more of a burden on families; giving aid to some on merit and telling others the University cannot cover their costs; or dropping "need-blind" admissions by admitting a percentage of students who will receive full aid and then admitting others on the condition that they are able to pay. Provost Aiken said Student Financial Services was already having problems meeting student need because the federal government is not giving the University enough money. He added the University needs to raise enough money for its financial aid endowment to produce another $10 million in interest over the next 10 years. Aiken said deciding between funding financial aid and funding academic programs is a "difficult trade-off." Student Financial Services Director William Schilling was not available for comment. Trustees must approve any budget deficit. The Trustees' bylaws mandate balanced budgets every year and the body's executive board will have to grant an exception in order for the University to plan for a deficit. Hackney said the chairperson of the Trustees' Budget and Finance Commitee, and Trustee Chairperson Alvin Shoemaker, know the University has planned for a deficit next year. Others, he added, have been sent a letter informing them of the administration's plans. The entire budget will be voted on at the Trustees' general meeting in June, but Hackney said if the Trustees do not approve of the deficit, they will tell him at Friday's Executive Board meeting.

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