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Budget Update II

Posted by | December 29, 2008

Recent weeks have been filled with important budget news for the state, WSU, and CAHNRS. As I noted in my message to CAHNRS faculty and staff just before Thanksgiving, I will communicate as clearly and consistently as possible about how we as a college will approach the budget challenges ahead. Given recent news, it’s a good time for an update.

There are two budget situations we need to be mindful of: (1) the current fiscal year budget, and (2) the 2009-11 biennial budget.

FY-09

Prior to Thanksgiving, we had just finished addressing a $6 million “call back” of state funds for FY-09. CAHNRS’ portion was approximately $300,000. Recently, the Governor announced an additional $4.5 million “call back” from WSU, which resulted in a $351,000 reduction in the ARC budget and a $130,445 reduction to Academic Programs. We are attempting to handle this second round of reductions within the ARC and CAHNRS Academic Programs Office; therefore, at this time, we are not requiring units to return any additional funds for the current fiscal year.

2009-2010 Biennium

As I am sure you have heard, Gov. Gregoire released her proposed budget for the 2009-11 biennium on Thursday. As you know, the budget was very austere, with reductions of between 15-20 percent below 2007-09 levels for most agencies. If the legislature adopts the governor’s budget, WSU would be required to reduce its annual $262 million state budget by $31 million, or about 12 percent. If WSU Regents approve the maximum tuition rates allowed, the actual university budget reduction would be about $22 million or 8.5 percent.

Specifically, the governor’s budget proposal:

  • Provides for no employee cost-of-living increases anywhere in state government over the next biennium.
  • Funds no new programs requested by the university (including the CAHNRS “Emerging Agricultural Issues” Initiative).
  • Presumes a maximum of a 7 percent tuition increase for all four-year university students and freezes all other fees in higher education.
  • Recommends a $104 million capital budget for the next two years; that is down from the current capital construction budget of $190.8 million (none of CAHNRS’s capital projects were included).

So, what does all of this mean for CAHNRS? Obviously, the release of the Governor’s budget is just the first step in the State’s budget process. The next step occurs when the Senate and House convene on Jan. 12 and begin their own budget deliberations. The legislature and governor will sign the final budget in May. Many “experts” think the ultimate reductions to the state’s four-year universities will be very similar to what the governor has proposed.

We don’t know exactly how such a budget scenario will translate to a reduction in our ARC, Extension, or Academic Programs budgets.

Obviously, some of the reduction will be assumed centrally, prior to distributing reductions to colleges. As you may have seen in President Floyd’s Dec. 11 message to the university community, “providing support for the state agriculture industry through research and extension across the state” was one of three strategic priorities listed. This is good news for a portion of the programs in the college.

Despite what many have said in the press, I am cautiously optimistic about these budget projections, particularly relative to some of the draconian scenarios that have been proposed over the past few weeks.

Most WSU administrators and government relations personnel agree.

However, reducing our budgets by the final percentage that is ultimately passed on to the College will not be easy. Clearly, we cannot continue all programs currently offered, and those that we do maintain will likely not be funded at current levels. We will need to be thoughtful and strategic in our approach. I have appointed a Budget Advisory Commission comprised of faculty and staff from throughout the college to help us in this activity.

I realize these are difficult times. I also realize the tremendous responsibility that I and all administrators within the college have in navigating these turbulent waters, while trying to protect our critical programs and the livelihoods of our valued employees and students.

During this holiday season, be thankful for what we have and rest assured that we will come out of these tough times a stronger and more focused organization.