SUNY Potsdam

Full Faculty Meeting, Oct. 29, 2009

Budget Update.

We have two major issues:
1. How we make permanent the $6 million or so in recurring deficit with which we started this year?
2. How do we manage the current year reduction based upon a $90 million cut to the System?

Second issue first:
Chancellor Zimpher has a task force made up of 5 Presidents, several Provosts and VPs for Finance, which is analyzing the best way to handle the current year reduction.  Provost Madden serves on that small task force.  No decision has been made but discussions indicate that our campus will be responsible for something less than the $1.5 million we would normally be called upon to return.  But deliberations are on-going.  The Provost reports back to the Cabinet on a routine basis, and VP Lewis has been listening in on the conference call.

As to the need to reduce our recurring budget by $6 million: as I last reported we have identified slightly over $5 million, largely through continuing many of the reductions in place this year, holding positions vacant, moving some costs to appropriate fees, reducing most OTPS, expense, budgets.  Some things could not be continued for another year, such as our computer replacement fund and some purchases of academic equipment.

The remaining $1 million will need to come from:

• Some administrative reorganization.
  Working with the Deans we believe that we can create a different administrative structure in some areas which will save us many thousands of dollars.
• Some curricular changes
  The Provost is exploring some proposals to make changes in our curriculum which might save us tens of thousands of dollars.
• I have just announced a voluntary severance package whereby those employees on contracts through the State, might leave the College no sooner than April 1, 2010, with incentives which might include guarantees of future part-time employment or payment of a one-time financial incentive.
• Depending on the success of these actions, we may need to reduce more positions.  In this we have several options, which we will pursue in this order as is necessary to close our budget gap:
  
  • Continue to freeze most vacant positions
  • Cancel temporary service contracts, where possible, according to work rules
  • Non-renew individuals as contracts come up, again according to work rules
  • And lastly, eliminate programs with lay-offs and retrenchment for the affected employees, again according to the appropriate contractual stipulations and processes
    

Consequently, whether or not we need to cancel contracts, non-renew individuals, or eliminate programs depends on our ability to close the permanent budget gap with the other tools I have outlined.  At this juncture, nothing is off the table and we are looking to see what other options we may have to pursue.  The elimination of programs requires the permission of the Chancellor and she has not indicated whether she will even accept such proposals.  Consequently, we have not made any such requests to the Chancellor.  She has indicated that this is a topic which her task force will consider.  Even if permission is given, the process takes at least two months and no announcements can be made until the very end.  

If we can increase our revenues, through increased enrollment, for example, we will have more leeway than if we continue to have a relatively stagnant enrollment.  This may not alleviate our need to continue to reduce expenditures, but it will certainly place us in a more comfortable financial position.  Increased enrollment in the graduate program is especially needed.  Each additional in-state graduate student brings in just under $9,000 annually in tuition and fees.  Faculty members are encouraged to assist in any way they can in their departmental recruiting.  We are attempting to improve our marketing of graduate programs, and have made great strides in the mechanics of the graduate admissions process.

Similarly, faculty should take an active role in helping the undergraduate recruiting by working with Admissions as they contact prospective students.  And lastly, retention is extremely important, since it costs us far less to retain a student than to recruit a new one. A five percent improvement in retention brings in $375,000.

The financial condition of the state is perilous.  When the state catches a cold SUNY gets pneumonia.  I do not foresee an improvement in the state’s economic climate for years to come.  We can lobby to have the state return the tuition increase from last year, and we can seek some administrative rule changes which will help SUNY deal with these perturbations in state funding.  But these are mid-term projects and offer little or no immediate relief.

To conclude, we have developed a plan to address the budget problems.  The extent to which we need to look at non-renewal or program elimination depends upon the degree to which we can permanently solve our budget gap with less draconian actions.  Because the non-renewal of contracts and program elimination are subject to extensive rules and regulations, I am not at liberty to discuss any aspect of them.  I sincerely hope that we will not need to take those actions, but as I have said previously, they must remain options given the dire circumstances in which we find ourselves.