Inside Iowa State

Jan. 16, 2009

Construction continues this winter at sites around campus, including phase 1 of the biorenewables complex on the west side (pictured). State building appropriations, private gifts and bond revenue can't be used to meet reductions in the university's FY09 operating appropriations from the state. Photo by Bob Elbert.

State budget crunch hits campus

by Anne Krapfl

Searches will be put on hold, travel for professional development will slow down, and there will be fewer very small class sections this spring as the university community adjusts to meet a 1.5 percent operating budget reduction ordered Dec. 18 by Gov. Chet Culver. The university's cuts are part of a statewide reduction caused by falling state revenues.

At Iowa State, 1.5 percent of its state operating funding is $4.255 million. This amount was distributed among the units that receive direct state appropriations:

• General university, $3.265 million
• Agriculture and Home Economics Experiment Station, $538,448
• Cooperative Extension Service, $343,555
• Veterinary Diagnostic Lab, $47,401
• Institute for Physical Research and Technology, $26,543
• Small business development centers, $16,371
• Leopold Center, $7,612
• G.W. Carver endowed chair, $3,750
• Livestock disease research, $3,311
• ISU Research Park, $2,378

President Gregory Geoffroy said he considered several options for meeting the reduction.

"At this point in the year, our options for meeting reductions are limited," he said. "I think distributing this reduction across the board is the best way to finish this academic year with the least disruption to our core mission, especially that of educating students."

"Leaders are employing a variety of short-term strategies to get us through these mid-year reductions," said Ellen Rasmussen, associate vice president for budget and planning. She said the current expectation is that these reductions -- and an earlier $2.915 million reduction -- will carry into the FY10 budget.

"Quite honestly, we don't know the full extent of reductions for FY10 yet," she added. By law, Culver has to present his FY10 budget to the Legislature by Jan. 31.

"We will take a multi-year approach to our budget development until state support stabilizes again. The [resource management budget model] fits that need really well," Rasmussen said.

Unpaid leave

While numerous units have decided to suspend or cancel position searches, Rasmussen said a hiring freeze has not been imposed. The three college dean searches are proceeding.

"Our message to administrators has been that they need to think it over carefully and make their own decisions about their own searches," she said.

Twenty-eight administrators, including the president, vice presidents, associate and assistant vice presidents, deans and associate and vice provosts, will take five-day furloughs by June 30. Rasmussen said the total cost savings is about $129,000, and those funds will be credited to the individuals' units. Part of the savings from voluntary furloughs by four athletics department officials -- director Jamie Pollard and head coaches Bill Fennelly, Greg McDermott and Paul Rhoads -- will cover athletics' portion of the reduction in the president's division. The rest will be redirected within the athletics department.

Rasmussen emphasized that furloughs and leave without pay by any other university employees are strictly voluntary. Budget leaders won't know the budget impact of additional voluntary furloughs or leave without pay until after Feb. 6. (See accompanying Q&A for the logistics of arranging a voluntary furlough or leave without pay.)

Strategies

Further distribution of the general university reduction of $3.265 million was as follows:

• Academic affairs, $2.627 million
• Business and finance, $415,327
• Student affairs, $136,254
• President's units, $86,689

Academic affairs

Academic affairs include the seven colleges, the library, IT services, the executive vice president and provost's office, research administration and the university's Institutional Excellence Fund for strategic priorities.

Rasmussen said decisions made to meet the reduction include delaying some faculty searches; leaving other positions vacant; offering fewer sections of some courses this spring and eliminating some elective courses; eliminating seed funding for research projects, grant matches and faculty start-up packages; deferring or eliminating scheduled equipment replacements and building renovations; cutting back on planned travel; and reducing general supply budgets. The library will reduce its electronic journal budget.

Business and finance

The largest components in the business and finance division include the broad facilities and grounds umbrella, human resource services, campus business services and public safety. Vice president for business and finance Warren Madden said reduction plans include deferring numerous computer hardware and software upgrades, delaying scheduled maintenance projects, not filling some vacant custodial and grounds positions and further energy conservation measures.

Student affairs

Vice president for student affairs Tom Hill said reduction plans in his division include delaying several staff hires and a planned workspace renovation, deferring scheduled computer replacements, reducing professional development funds and redirecting program funding from other sources to replace the state dollars.

President's units

Units within the president's division include the university relations, marketing and legal counsel offices; athletics; ombuds office and alumni association, some for whom state funds are a small part of their budgets. Similar to other divisions, the president's reduction will be covered with furloughs, at least one staff position remaining unfilled and reduced travel budgets.

Construction continues

New building projects will continue as planned. Madden said those projects are paid for in part with capital appropriations, not operating appropriations. State law doesn't allow the university to substitute one for the other. Other key funding sources for the construction projects are designated private gifts and revenue bonds sold specifically for the project, neither of which could help the university meet the reduction. Madden also noted that if Iowa State canceled a construction contract, it could face significant penalties and other costs.

Madden said several large campus projects -- including Hach Hall, the biorenewables research lab, the Design addition, commons renovation work at Maple-Willow-Larch and improvements to the east side of the football stadium -- employ more than 400 construction workers, which is important to Iowa's sagging economy.

"If infrastructure and capital investment are part of an economic stimulus plan, we have outlined a number of critically needed projects that could quickly be under construction," he said.

Voluntary options for employees

"At this point in the year, our options for meeting reductions are limited. I think distributing this reduction across the board is the best way to finish this academic year with the least disruption to our core mission, especially that of educating students."

-- Gregory Geoffroy