University creates budget updates web site; UI treasurer discusses developing budget picture

Doug True, senior vice president and University treasurer, discusses the budget planning that lies ahead for fiscal year 2010. Photos by Tom Jorgensen.

Budget issues have become a constant topic of interest across the University of Iowa community. With that in mind, UI officials have created a web site to provide faculty, staff, and students with updates about ongoing budget deliberations and announcements, and to solicit ideas for trimming expenses as the University works to reduce costs during uncertain economic times.

“The University has to engage its members as UI administrators consider how to manage what inevitably will be lower state appropriations,” says Doug True, senior vice president and University treasurer. “President [Sally] Mason, Provost [Wallace] Loh, the vice presidents, and the deans are working through a process that will involve UI constituency organizations—faculty, staff, students, elected leaders—to consider the best ways to proceed.”

The web site—http://budget.uiowa.edu—includes a link soliciting constructive ideas for cost savings from faculty and staff. It also features messages from President Mason, Provost Loh, and David Miles, president of the Board of Regents, State of Iowa. The president’s message, dated Feb. 10 (the day the site was made public), echoes an e-mail sent to the University community that stated the challenges ahead and the core principles that will guide budget decisions.

True reiterated those key areas of importance—maintaining the access and quality of educational offerings, research responsibilities, and flood recovery efforts—the following day while discussing general budget issues with fyi. He also spoke about ways faculty and staff can help reduce costs through simple actions, and whether measures such as layoffs or furloughs are within the realm of possibility at this point.

fyi: At what point will the reductions to state appropriations become clearer?

True: The governor has made his budget known in response to the changing state revenue picture: he has proposed a budget for fiscal year 2010 that would cut almost all state appropriations by an additional 6.5 percent. That would translate into a $17.5 million budget reduction for the University’s General Education Fund on top of the current—and already reduced—budget. In the next couple of months, the general assembly and governor will likely reach an accord on an exact amount for next year.

Part of that process will occur in mid-March at the state’s revenue estimating conference—the economic prospects for the next fiscal year are put on the table. The conference’s outcome is critical to the final decisions about appropriations and how much less The University of Iowa will get in fiscal year 2010. But we can’t wait 30 days to begin detailed planning; we are beginning now using approximated levels of reduction.

The work being done now will help us later this spring when the budget needs to come together for presentation to the Board of Regents. We will have reviewed not only our proposed new expenditures but also our basic expenditures to look for efficiencies. We will have our very best options on the table to protect the University’s highest priorities, but also to preserve other aspects of the University that are important to faculty, staff, and students.

Provost Loh is meeting regularly with the deans to discuss ways to reduce expenses while preserving teaching capabilities and research functions. The Faculty-Staff Budgetary Planning and Review Committee also is involved in this process, and numerous suggestions already have been submitted through the budget updates web site. It is stimulated and rewarding to engage all of these individuals in the creative process of responding to our economic circumstances.

fyi: Are there areas of focus that could lead to immediate savings?

True: We want to take a good, hard look at energy. We have a great track record on sustainable energy—our most prominent piece being our use of oat hulls, work that the power plant has done for years. But we need to refocus and find short-term gains in ways that faculty, staff, and students can accomplish.

In the past, we’ve had days in which we curtailed consumption of energy on this campus during summer peak demand—we might need to revisit and broaden these cutback periods. This would not affect patient care, of course; we can and will identify areas where we can make a difference.

Building occupants can take simple actions to help find cost savings—turning off lights and computers makes a difference. Along those lines, there’s a competition among Big Ten universities over conformance with computer shutdown in the evening. This competition increases awareness of the impact one person can make. One very simple act equals a small savings, and when multiplied by tens of thousands…what a difference that can make. These are steps that can be done not just in time of reduced appropriations but all the time.

fyi: People are anxious during these times. Can you speak to the possibility of furloughs or layoffs?

True: We have to look at the University, which is a heterogeneous operation, and think about our varied functions as well as consult broadly on how best to achieve substantial personnel savings. For instance, we are involved in patient care, and we conduct 24-7 research functions. The University as a whole is not simply an 8-to-5 office setting.

That being said, all forms of expense reduction tools are on the table to try to manage immediate savings requirements in the short term as a bridge to longer-term expense management.

As a result, furloughs and similar actions, as difficult as they might be, are not off the table. We need to think about how we best manage our functions as a university. And much will depend on the ultimate level of reductions required by appropriation changes.

Faculty and staff always ask about layoffs—certainly we prefer not to do that. It’s much easier to hold vacant positions open and manage accordingly. However, layoffs may be necessary, and only developments over the next few weeks will determine that outcome. We will find the best way to adapt, using the president’s principles as a guiding light, while preserving jobs wherever possible.

We must be very creative, very innovative, and only resort to more difficult actions when we know that is required. Ultimately, we have to balance the budget. The state and the University are organizations that have to balance budgets; and it will be done collectively and thoughtfully.

by Christopher Clair