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News & Events

Budget Messages/Updates from Provost Rita Cheng

March 25, 2009
March 9, 2009
February 16, 2009

 

March 25, 2009

Deans and Academic Affairs Directors,

Now that we have more concrete information about our campus share of the 2009-11 budget reduction, we have updated the directions for preparing your budget planning materials due April 1st.

Although we need to continue to examine our capacity to reduce our expenditures by as much as 10% should state resources or other campus revenues continue to decline, at this time we will assign only those amounts necessary to meet the state budget reduction as proposed by the Governor over the next two years. The attached materials include a revised table providing the distribution of campus reductions for 2009-10 and 2010-11 by unit. I am asking each dean and director to submit a list of reduction strategies that would reduce expenditures by 5% for each year of the biennium and to prioritize those strategies that will achieve the anticipated budget reductions assigned on this table. Deans of units with budget deficits should expand the 5% list in order to recoup funds to eliminate budget deficits. The two options for 2009-10 are based on an assumption of a moderate tuition increase (Scenario A) versus no offset from a tuition increase (Scenario B). While there may be an additional tuition offset in 2010-11 that could diminish the budget reduction, at this point we will continue to plan for the reduction as proposed by the governor.

The updated budget planning instructions also include the template for the 2009-10 recruitment plan as well as a draft compilation of space needs and issues relevant for the 2011-13 Capital Plan. You'll recall that these plans build from issues identified in prior biennia that combine with issues more recently identified. We welcome your suggestions for additions or revisions to this draft list.

The budget planning instructions also provide an opportunity for you to identify strategies for increasing your revenue base as well as your contributions to our strategic initiatives. I'm looking forward to discussing these revenue-generating and cost reduction strategies with you. Planning meetings will be scheduled starting around April 15 at which time we will review your planning material. One expected outcome of these meetings will be to arrive at strategic choices for next year and to plan strategies for absorbing possible larger reductions in the future through achieving efficiencies, reorganizations, etc while also building our revenue options in keeping with our strategic initiatives.

If you have any questions, please contact Ed Rodriguez (e2r@uwm.edu, x5291).

Best,

Rita

Rita Cheng
Provost and Vice Chancellor
Academic Affairs
UW-Milwaukee

Attachments:

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March 9, 2009

Dear Colleagues,

Chancellor Santiago’s recent message to the campus reviewed the current status of the 2009-11 budget for the UW-System as proposed by the Governor:

  • A $100 million GPR reduction, broken into a $65 million reduction in 2009-10 and a $35 million reduction in 2010-11.
  • A $49 million, 1% across the board cut from most non-federal funds.
  • A $25 million transfer from auxiliary funds for enhanced financial aid

UWM’s share of these reductions and transfers over the biennium is $19.8 million. Our preliminary calculations translate this to a $16.3 million reduction to our non-auxiliary funds and a $3.5 million transfer/reduction of auxiliary funds. It’s important to note that, in these calculations, there is no tuition offset. Tuition, proposed by the governor to increase moderately (estimated between 5% and 6%), is expected to partially offset the budget reduction in each year of the biennium. What this all means for us is that we should plan for a $10.1 million reduction in spending on non-auxiliary funds and a $2.7 million cash transfer and spending reduction in auxiliary funds in the first year (2009-10) of the biennium. In our preliminary campus modeling, we had included auxiliary funds in our “all funds” approach to absorbing anticipated campus budget reductions, but this direct reduction of auxiliary funds by the state will temper our inclusion of auxiliary funds to “cushion” the reduction that must be absorbed by other campus funds.

Our projections suggest that reductions in non-auxiliary funds may be less in the second year of the biennium (2010-11) due to some tuition offsets. However, we must also be prepared for the consequences of continued economic downfalls for the State.

The budget is not final and many changes may yet occur that could affect us negatively or positively. For example, the Governor’s budget did not include any funding for the Growth Agenda, but there is growing support internal and external to the university to fund aspects of the Growth Agenda. On the other hand, our budget may be further reduced by potential softening in enrollment and a large drop in proceeds on endowment funds.

What we know so far from the Governor’s proposal reinforces the appropriateness of the process we have begun to prepare ourselves for options to deal with a 5% - 10% budget reduction. We are quite optimistic that the 2009-11 biennial budget may require cutbacks closer to the 5% than the 10% range, which is good news for all of us. However, we need to be mindful that a continuing decline in the state and national economy may bring additional reductions during 2009-11 and in the following biennium.

Along with the budget planning guidelines, we distributed a list of “guiding principles and suggested strategies” for dealing with the anticipated budget reductions. This list has received considerable attention, and that was its purpose. It’s a compilation of ideas that are being discussed at the various levels at which they could be implemented and we continue to welcome suggestions and feedback. Every school, college and support unit within Academic Affairs is examining these ideas to determine the combination of strategies that is most appropriate for their budgetary circumstances.

Over the next few weeks, we will learn more about the 2009-11 reductions. But uncertainties will remain regarding additional lapses that might occur in 2009-11 and possible further reductions in our 2011-13 budget. This situation really does necessitate considering and adopting both short-term and long-term strategies to reduce expenditures while maximizing revenues. We also want to adopt strategies that maintain the momentum we’ve achieved over the past few years in establishing UWM as a high-quality research university that stimulates the economy of Southeast Wisconsin and that provides access to success for our students. Such strategies must include gaining efficiency. We should revisit how we can attain greater efficiencies in technology and marketing as we had agreed to do six years ago. Faculty and staff committing extra time and effort is another example of a short-term strategy that can maintain both momentum and revenues. This suggested strategy is not about changing work load policies, but it has prompted good conversations regarding differential contributions of faculty and staff depending on strengths and interests in filling departmental needs and goals.

A question has been raised as to whether we will allocate budget cuts across the board. As was the case when our budget was reduced by similar amounts in 2003-04, we expect to differentially apportion the cut across activities to diminish as much as possible the impact on our instructional, research, and student service programs. We also expect deans and division heads to weigh the consequences of proposed reductions along with proposed opportunities to maintain momentum and increase revenues as they prepare budget reduction plans.

As we approach these challenging times and tasks, I encourage us all to focus on what we can do rather than on what we cannot do. At our biweekly meetings, the deans and I have shared many ideas and strategies that are forward-thinking. Let’s all keep these ideas flowing and communications open as we work through the next few weeks of planning.

Rita Cheng
Provost and Vice Chancellor
Academic Affairs
UW-Milwaukee

 

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February 16, 2009

Dear Colleagues,

I'm launching today periodic communications to faculty and staff in Academic Affairs as we all struggle with the fiscal uncertainties facing our campus, state, nation and world. I would love to be able to provide the details we all want to know, but pledge that I will share any information we learn and how we are going about preparing for anticipated budget reductions.

Tomorrow, February 17, Governor Doyle will share his proposed budget for 2009-11. This will be our first indication of the extent to which the UW-System will be asked to absorb budget reductions. And, as you know, the Governor's presentation is only the beginning of the budget building process between the legislature, the Department of Administration, and the Governor.

We have been preparing for a range of possible budget scenarios by asking all units to develop contingency planning based on 5% and 10% budget reductions. We are hopeful that the state budget reduction will not be at the 10% magnitude, but there are other repercussions of the financial crisis that affect our resources – potential declines in new freshmen, lower returns on endowments, etc. We have gathered ideas in an ever-revising list of Guiding Principles and potential strategies for weathering anticipated budget downturns. These ideas have been offered by faculty and staff as proactive steps for what we CAN do, not things we cannot do in light of our situation. As Chancellor Santiago emphasized at his recent plenary presentation, we have been faced before with budget reductions as recently as five years ago. We did similar planning at that time, and came out, five years later, a stronger university. We can do so again.

One thing that we must do is serve well the students who do choose to enroll at UWM. Many have raised the question of how to approach the fall schedule of classes that is due this Friday, February 20. This is certainly a time of uncertainty, but I want to emphasize that although UWM must prepare for budget reductions, we should plan the fall schedule with optimism and - certainly - with capacity to serve students. I urge all departments to not reduce the schedule, but rather prepare the fall schedule with maximum flexibility to cancel and/or combine sections. The last thing we want to do is deny enrollments to students by making courses unavailable or delay registration dates.

This is a good time to ensure that courses critical for degree completion by a department's majors and others are offered and set at the appropriate capacity to enable student enrollment. Those courses that are traditionally under-enrolled should be considered for reduction/combination. By the time registration begins - April 14 - we will know much more about state funding and can adapt as needed. I am sure that you agree that scheduling with built-in flexibility is always a good approach for adjusting courses to enrollments as students register. It is even more important at this difficult time.

Finally, I want to assure my colleagues that, while everyone is modeling 5% and 10% budget reductions, any budget reduction we need to absorb will be differentially appropriated in recognition of the critical importance of our instructional and research activities.

Once the Governor’s budget proposal is released and its implications for UWM are better understood, I will communicate with you again.

Sincerely,

Rita Cheng
Provost and Vice Chancellor
Academic Affairs
UW-Milwaukee