 | President's Message (distributed 2/24/06 via e-mail)
In an effort to communicate important initiatives and decisions being discussed by the University's senior-level academic and administrative leadership, I will begin sending all-campus emails focused on specific topics. I hope this communication provides the context and clarity needed to understand issues important to our University community. The first email provides detailed information concerning the budget realignment plan discussions.
I presented the proposed budget realignment plan to the chairs of the Faculty Senate, Administrative Senate, Classified Senate, Chairs and Directors, the Vice President of the Student Senate, and the President of AFSCME Local 1699 at a meeting on February 3, 2006. Provost Kathy Krendl, Interim Vice President for Finance and Administration Larry Corrigan, and Linda Lonsinger, Director of Employee and Labor Relations, also attended this meeting. Representatives were asked to provide feedback and input on the plan from members of their groups by February 17, 2006.
A second meeting was held on February 17, 2006 to listen to the feedback and input from the leaders of the constituent groups. The Chair of the Fraternal Order of Police/Ohio Labor Council Inc. also attended the meeting along with Provost Krendl, Interim Vice President Corrigan, and Ms. Lonsinger. The leadership representatives presented many good suggestions based on their conversations with members of their constituent groups. These suggestions will be considered as the final budget realignment plan is drafted.
Budget Realignment Plan
As previously announced, initial budget projections indicated a $9.4 million deficit for FY07 and even larger deficits in subsequent years up to a deficit of nearly $14 million by FY10. These deficits are occurring because of the continuing decline in state subsidy, our desire to keep tuition increases at a minimum, our commitment to competitive wage increases for our employees, the rising cost of health care and utilities, and our goal to maintain competitive scholarship programs. (See chart illustrating Current Cycle of Annual Budget Cuts and the gap between new base budgets and revenues at http://www.ohio.edu/president/files/index.cfm
The total amount of the proposed budget realignment will be $18.6 million for FY07. By doubling our budget realignment to $18.6 million, we will move away from the current cycle of annual budget cuts. The budget realignment will provide approximately $9.2 million to reinvest in the academic priorities of Vision OHIO during FY07. (See chart illustrating Effect of Proposed Realignment at http://www.ohio.edu/president/files/index.cfm
The Effect of the Proposed Realignment chart shows how the $18.6 million proposed realignment in July 2006 will reverse the budget deficit trend. Revenues will exceed expenditures by $9.2 million for academic year 2006-07. During this time, Ohio University must develop new sources of revenue by investing in areas identified in Vision OHIO. These investments will likely include additional support for undergraduate and graduate programs, faculty lines, and research.
Next Steps
We will ask the Ohio University Board of Trustees to approve a proposed one-year voluntary Ohio Public Employees Retirement System (OPERS) Early Retirement Incentive Plan (ERIP) for eligible staff members. Through careful review of vacant positions and ERIP participation, we hope to keep layoffs to a minimum.
Our next steps also include working closely with all planning units to advise staff of the specific plan for meeting the budget realignment. This will include frequent updates from appropriate central offices regarding matters impacting the University community.
The proposed budget realignment plan will be university-wide and impact all units within the university. The budget realignment plan was not based on the same percentage of reductions across all academic and non academic units. Thus, the plan will affect every unit differently.
When the details of the final budget realignment plan are announced, additional meetings will be held with the leaders of the constituent groups to solicit additional feedback and input.
Additional Information
As a result of the proposed budget realignment plan, an opportunity to centralize some of our existing resources to support the major initiatives in Vision OHIO has been presented. Some of the areas being considered for selective integration include business services, diversity, and faculty development. As we recently announced, the Office of University Outreach has been created to better support partnerships, research, and outreach activities.
Cordially,
Roderick J. McDavis
President -30-
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