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May 18, 2001

Legislature adjourns; budget questions remain

by Anne Krapfl
Iowa State University's operating budget for the fiscal year that begins July 1 will be about 6 percent leaner than the current budget. Iowa legislators approved a state government funding package May 8 that will result in about a $15.8 million reduction for Iowa State. Gov. Tom Vilsack has yet to sign the proposed budget.

Interim President Richard Seagrave said he anticipates a total budget reduction of somewhere between $18 million and $20 million for the new fiscal year. Under-funded employee health insurance costs that took effect in February will add approximately $2.5 million to the university's shortfall for fiscal year 2002.

"This funding shortfall presents a significant challenge to our university community," Seagrave said. "At the same time, I'm relieved the reduction isn't as severe as the numbers that were being discussed earlier."

Seagrave said he and other university administrators continue to plan strategies to address the shortfall. Closing the university for a time over the winter holidays, as was proposed last month, remains an option. No final decision has been made on a winter closing. Seagrave emphasized that employees should be implementing energy conservation methods announced in mid-April.

In other budget business, lawmakers:
  • Approved $10.9 million in state funding for Iowa State's top capital priority construction of a College of Business building ($4.2 million in FY 2002; the remainder in FY 2003). That funding will be matched with $13.4 million in private gifts to complete the project. Site preparation work is scheduled to begin this fall.
  • Did not provide increased funding for the Plant Sciences Institute. The governor's early budget included an increase of $3 million for the institute.
  • Approved a salary increase and benefits package (which covers salary increases for all state employees) of $79 million, short of the $91 million recommended by the governor. ISU officials haven't learned yet what the university's piece of that $79 million will be.
  • Eliminated the state funds for the student work-study program. The university still will receive federal work-study funding.

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