President Welty's Budget Speech

Craig Bernthal

(I've had so many people ask me to keep blogging on Fresno State issues that they've convinced me to keep going to the end of the semester.)

Since I was unable to attend President Welty’s presentation on the budget (Renaissance Literature, TT 10 to 11:50), I am relying on Chris Henson’s extensive notes, most of which I am quoting verbatim. Thanks, Chris. A video of the speech should be up soon, but is not available yet. When it becomes available, I will edit this blog to include it and make any necessary adjustments in Chris's notes. This is the best we can do at this time. I have a couple of observations at the end. Chris’s notes are in blue:

President Welty focused on the budget plan for 2012 – 13 and then went looked ahead to 2013 – 14 and beyond.

He provided an overview of the funding resource shift in the last four years:

            State appropriate decrease: $47.8 million;

Tuition increase: $48.5 million (but $18.9 million of that goes to SUGs, state grants to students;

Add it up and there is a $17.5 decrease overall.

The results to staffing over the last 4 years:

            124 administrative and staff positions eliminated

204 faculty positions eliminated. [Chris is unsure that she got this figure right—I will check the video when it comes out and make a correction, if necessary.]

If Governor Brown’s tax referendum fails, another $19.5 million will be cut from Fresno State next year. This will come in the middle of the academic year. For the entire CSU, the cut will be $200 million.

Plans for 2012-13:

--Carry-forward reserves will be used to absorb the 2012-13 cuts so that no additional cuts will be made to School/Colleges or Administrative units for 2012-13.  Those units will have the same dollars as for this academic year.  There will be constraints on such things as hiring and travel.  "All hiring will be consistent with our Strategic Plan."

--expansion of recruitment and enrollment of international students

--implementation of University's "new branding"

--updating of a new strategic plan for Information Technology

--continued diversification of resources (getting more private money)

--aggressive management of enrollment

Regarding aggressive management of enrollment

     --If Brown's proposal doesn't pass, that will necessitate a 3% decrease in enrollment on this campus--800-1000 students

     --Spring 2013 admissions will be frozen

     --All applicants for Fall 2013 admission will be waitlisted until after the November election--if the governor's proposal doesn't pass, then that 3% decrease will

             affect those applications

     --Students enrolling for Fall 2012 will be restricted to no more than 16 units

Looking to 2013-14 and beyond:

      --If Brown's initiative passes, that means a more stable future--includes a 4% increase for higher education for each of the next 3 years

      --If it fails, that will mean a base budget reduction on this campus of $12.6 million for 2013-14--This is the $10.5 million in state money allocated plus $2.1 million

               fee revenue reduction because of decreased in enrollment

      --That $12.6 million reduction will mean:

                 --examination of all programs and elimination of some

     --the need to use carry-forward reserves to implement the programmatic changes

                 --the maintenance of smaller carry-forward reserves

Discussion of carry-forward reserves:

Bar graph showing history of reserves - 2009 - $27.3 million

                                                            2010 - $44.1 million

                                                            2011 - $65.7 million

                                                            July 2012 (anticipated) - $60.6 million (with $10.5 million set aside to maintain current funding to Colleges/Schools)

                                                            2013 - $40.1 million (anticipated)

The increase in carry-forward reserves has been the result of a "conscious decision" to hold reserves to prepare for the uncertainty of the budget in the next few years.

By 2014-15, it is anticipated that carry-forward reserves will be back to the more usual amount of approximately $25 million

Budget cut targets for 2013-14 - Academic Affairs - $8.9 million

(I didn't get the figures for the other units)

Lots of emphasis on the fact that he's conferring with the University Budget Committee all of this.  "I value the advice of the UBC."

Emphasis on the importance of "being as innovative and creative as possible" in the future:

Two examples:  --possibility of an IT consortium with other campuses

                               --shared service centers on this campus

At end of Welty's presentation, a call for a "sense of community" and two specific requests

--Colleges/Schools can begin to plan for 2012-13 with assumption that there will be no further cuts for next year

--Everyone should register to vote and vote for Brown's initiative

What interested me the most in this was the discussion of the carry-forward. Given the tumultuous budget years ahead and the difficulty of planning, it seems quite reasonable to have a larger than usual carry-forward, and I was happy to see that President Welty directly addressed it. But we should remind ourselves of a few facts:

First, the UBC was not consulted about this carry-forward. Neither the UBC, nor the Task Force, nor the faculty at large knew about it until a few weeks ago. (I base this on what John Constable said in his Senate presentation when I asked him about it; he was still trying to understand it himself. It certainly came as a surprise to me, and it did not become apparent until dug out of the most recent on-line budget books.) The $65 million carry-forward was a piece of critical information for the faculty to have before the Budget Task Force convened. President Welty notes that the size of the carry-forward was not a mistake, but was achieved according to plan. I entertained the idea that the carry-forward might be a mistake because we had never been informed that it was planned. I note as well that the University Budget Committee, not knowing of the plan, had no input on the figure: how was the amount of $65 million determined as a reasonable carry-forward? Why not $63 million, with some of the pressure taken off class sizes and number of sections? We can only hope that this speech begins a new practice of budget transparency and budget-planning transparency as well.