Update on Campus Budget Challenges
Dear Campus Community,
At this afternoon’s Budget Open Forum, information was shared about the challenges we face as we seek to balance our budget in coming years. Because some could not attend, I want to provide you an overview of what was presented and to let you know where you can find additional information.
Humboldt State is facing a looming financial crisis based on a combination of intersecting factors: The changing higher education landscape, insufficient state funding, looming economic downturn, increasing mandatory costs, fluctuating enrollment, and deficit spending. The campus has held a series of open forum meetings to discuss how these factors have impacted the financial landscape on the campus.
The University community is committed to our shared responsibility in promoting student success, equity and diversity, fiscal stability, and stewardship. HSU resolves to address the financial limitations of the foreseeable future while emphasizing the values of outstanding education and evidence of student learning, teaching excellence, diversity and inclusion, and the University’s linkages to local and regional communities and cultures.
In short, HSU’s budget situation has worsened over the course of this year due primarily to ongoing deficit spending in some areas, unfunded increases in salary and benefits, a continued decline in enrollment, and projections based on the recent state budget for 2018-19 proposed by the Governor (which Chancellor White called “concerning and surprising”).
The Phase I budget reductions, which were implemented this year, and the planned reductions now being considered for Phase II are an important starting point in addressing this problem. As we entered this year, we had reduced expenditures by about $1.5 million, and progress was being made on an additional $2.8 million in reductions.
Now, based on the Governor’s budget, enrollment projections, and other factors, HSU’s Budget Office estimates we are facing a $7 million deficit during 2018-19 that would grow to a $9 million deficit in 2019-20. To put this in perspective, our overall operating budget is about $134 million this year, and we currently have just over $6 million in operating reserves.
If we do not address this deficit now, we will face a fiscal emergency. In the meeting today, the following immediate, short-term, and long-term actions were announced:
- Implement a 5% reduction in current year operating expense budgets (non-personnel)
- No tenure-line faculty position requests for fall 2019
- Hiring chill: All staff and administrator hiring requests continue to be approved by Cabinet with the intent of reducing recruitments over the next 18 months
- Academic Programs and the Office of Institutional Effectiveness will assist the Colleges in building fall 2018 and spring 2019 class schedules that align available instructional resources with student course need
- All General Fund travel expenditures and other expenditures of $2,000 or more must be approved by the appropriate Vice President
Some short-term steps we will be taking:
- Cabinet will incorporate Phase II feedback into the February 22 reduction plan
- University Resources & Planning Committee (URPC) is developing a budget oversight policy
- Benchmark and recalibrate our spending by category (FIRMS codes) based on CSU system data
- Reduce an estimated 40-50 budgeted staff and administrator positions
- Reduce temporary faculty appointments in fall 2018
- Reorganize or consolidate units and functions
- Identify and implement process improvements
And longer term steps:
- Complete and implement Strategic Enrollment Management plan
- Rigorous review of all programs (administrative and academic) on campus
- Integrated assessment, planning, and budget process
- Enhanced fundraising efforts
The President’s Cabinet will continue to consult and build upon the recommendations and feedback that have been part of the Phase II process to develop a proposed budget by February 22. The URPC will then review the plan and provide recommendations. I expect to approve the 2018-19 budget by March 29.
To view the slides from today’s presentation and additional information about the University’s budget, visit the Budget Office website. The sections on "Campus Budget Planning" and “URPC” contain updated documents and information on upcoming years.
I know it is difficult to contemplate these types of budget reductions for our campus as a whole, or for your particular area. For me, it helps to remain firmly focused on our shared values and commitments. We all want the very best for our students; we want them to have an outstanding educational experience and to achieve great success. I will do my part to keep our values and commitments at the forefront of our work as we move forward together.
With best wishes,
Lisa A. Rossbacher, Ph.D.