Finance chief: Deficits at OU will force hard decisionsFinance chief: Deficits at OU will force hard decisions

With some of the toughest budget cuts in recent history coming next year and the year after, Ohio University will be asking questions about what is really necessary and what is not essential to the academic mission, Bill Decatur, senior vice president for finance and administration, confirmed in an interview Friday.

Last Tuesday, the American Association of University Professors (AAUP) held a faculty discussion about the university's bleak budget outlook for fiscal year 2011 and 2012. Faculty Senate Chair Joe McLaughlin, a professor of English, told faculty members in attendance that the university may face a $20.9 million shortfall in fiscal year 2011 and another $36.5 million shortfall in 2012. The figures are based on a budget scenario produced by the university's budget planning office, and numbers are not set in stone.

"We are starting out with a hole for next year," Decatur said. "Budget Planning Council, between now and the end of (fall) quarter, will be looking at the major drivers in the budget and come up with a macro-scenario."

Faculty members at Tuesday's meeting asked if they may see pay cuts or if they should worry for their jobs. Friday, Decatur said furloughs in faculty pay would be a one-time solution and that he prefers not to do that. The only time salary furloughs would be helpful would be to help cut the budget down to help implement budget plans for a one-year period, Decatur explained.

"We obviously face serious budget challenges," Decatur said. "We're all concerned about that. This university's core mission is student learning. That is preeminent. However we manage through this, it is going to be key to work to maintain instructional capacity."

One way the university will look at saving money is by allowing vacant positions to remain open, Decatur said. This means saving money while not having to cut current faculty.

From the administrative end, he noted, executive administrators have given up perks such as a majority of their cell-phone allowances. Administrators are also reducing their car allowances, and as individual contracts that include car allowances come up, those allowances will be eliminated, Decatur said. Deans and vice presidents also have not received raises this year, he added.

"It's very early," Decatur said of budget planning for next year. "There aren't any decisions made by the university on the next fiscal-year budget and beyond."

When it comes to health-care benefits and salaries, Decatur said that this year's budget cuts will be all about tradeoffs. The projected budget scenario allows for a 9 percent increase in the cost of health care and a 3.5 percent increase in faculty salaries.

Last year, faculty saw some $2 million in cuts to health-care benefits, a matter that caused controversy in Faculty Senate. As per the Faculty Handbook for OU, changes in health-care benefits must be submitted to Faculty Senate for approval. While the changes were submitted, they were not approved. The McDavis administration went ahead with the cuts without Senate's approval.

The Budget Planning Council also will examine what strategic investments the university should make, Decatur said. Vision Ohio dictates that the university invest extra funds in areas including faculty salaries and learning communities, Decatur explained, and BPC will look at how to invest money in the coming year.

As for cuts to programs, other institutions facing major budget cuts have considered low-productivity programs for elimination. Low productivity can be judged by the number of majors, credit hours, sponsored research and centrality to the academic mission, Decatur said.

At last Tuesday's meeting, faculty members demanded the university make cuts to Intercollegiate Athletics, a department that in the past few years has run up millions of dollars in deficits.

"I share faculty concern with regards to the continued deficit funding," Decatur said. "We have to complete the correction of that. Athletics make a vital contribution to the culture of the university."

Given the size of the gap in funding the university may see next year, OU must look institution-wide to come up with solutions, Decatur said.

"If you look at the total university budget ($325 million for the Athens campus in 2010), does that $20 million (projected deficit for FY 2011) hurt? Absolutely," Decatur said. "We have to look beyond the narrow confines of the Athens campus general fund budget to come up with solutions."

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Jason

If they really believe that "this university's core mission is student learning. That is preeminent", then the solution is simple. Get rid of athletic programs, especially the big budget ones. In one fell swoop they could likely wipe out the entire budget deficit, and not affect any programs that are directly related to that stated mission of the university. Playing football on Saturday is not student learning. Leaving faculty openings vacant, thereby increasing professor workloads, does not help the core mission. Cutting back on healthcare benefits, while spending 2, 3, or 4 times as much to play football or basketball games is silly. They can nickel and dime the problem all they want, and all that’s going to achieve is unhappy faculty and staff, a larger budget deficit, more excuses about how athletics is critical to OU, and still have a half full stadium on Saturday while racking up athletic program debt. It was stated that "athletics make a vital contribution to the culture of the university". Culture of the university is not a stated core mission or deemed "preeminent" is it? When’s the last time anyone heard OU culture referred to by anything other than the party school reputation? If you can't make the tough decisions that are required to TRULY address the problem, don’t blow smoke and tell us student learning is preeminent, all the while doing everything to cut into programs that actually educate, and athletics remains untouchable. That is unless you are the track program, or some other minor sport that actually saves very little money to get rid of, but makes it look like athletics are actually being trimmed back.

The Edge

To suggest that cutting athletics would resolve the budget deficit is asinine. The total budget from designated funds and general fees totals $13,015,000 for the current fiscal year. (see http://www.ohio.edu/finance/bpa/upload/FY09-SectionE.pdf) The estimated shortfalls are $20.9 million shortfall in fiscal year 2011 and another $36.5 million shortfall in 2012. (This article) Let's assume that athletics has no value whatsoever (despite the marketing value and the alumni relations [i.e. fundraising] value it has); even cutting it entirely still leaves you with 7 and 23 million dollars to find. We need to cut all sides of the house, academic, administrative, and student service; to pretend otherwise is simply wrong.

I would much rather cut the deficit by 65% by getting rid of athletic programs that are not directly related to learning, than continuing to fund programs that lose the university money every year. What percentage of the shortfall will be cut by getting rid of cell phones, not filling vacancies (that I assume were considered necessary when they could be funded, and weren't just "nice to have") or by continued layoffs or benefit cuts? I doubt anywhere near 65%. How much shortfall would that leave for next year, and the year after? Truly, how important is it to have a football or basketball team, when you are talking about people’s lives and jobs, and the economic viability of the largest employer in probably all of S.E. Ohio? Again, athletics is not directly related to the purpose of the university, which is to educate students. If its "asinine" to expect that education assets should be the last thing cut at an institution of higher EDUCATION, before continuing to pour money into the bottomless hole of OU athletics, then call me asinine, because I'm all for it. I would like to see some real numbers of the marketing value of any OU sports team, considering how poorly they tend to do, and how little known they are outside of the greater Athens metropolitan area. It would be my guess that more students likely attend OU because of its party school reputation than those that are somehow influenced to attend because of the sports teams, and I don’t even think it would be close. The only thing OU is really known for nationwide is its rankings as a top-10 party school. Not too many of their sports teams are going to come anywhere near that type of publicity, and its absolutely free and provided by the student body! You say that the burden should be spread equally across the board, by academic, administrative, and student services. I note that athletics wasn’t specifically included in your list. Ok then, let’s see the cuts in athletics to share the burden, something a bit more substantive than the track team, something that would provide real savings. Of course it’s not going to happen, I have no illusion that it will, but when they speak of “hard choices”, everything should be on the board, not just peoples jobs or benefits, or asking the faculty and staff to do more with less. It’s the tail wagging the dog.

Jason, Re-read your first post to see why your initial contribution was asinine. You wrote "in one fell swoop they could likely wipe out the entire budget deficit, and not affect any programs that are directly related to that stated mission of the university" if they cut athletics. Even your modified 65% number is misleading; it could be as low as 25%. Your sweeping generalized arguments that have no basis in the actual data of the budget lead to improper, unsupported conclusions that have no link to reality (or to put it shortly, are asinine). I too support trimming athletics, but wiping out athletics entirely, as you suggest we do, would be more harmful in the long term. If you glance at the Chronicle of Higher Education or Inside Higher Ed, you will find stories of many schools that cut athletics as a short-term cost-savings maneuver but, when alumni saw that athletics were gone -- the only thing many care about post-graduation -- they stopped contributing to the schools. This is particularly the case when football (the most expensive sport) is eliminated. If you want to be pennywise and pound foolish, that's your right (but please do it with your household budget, not a public one). As for your heart-wrenching argument that real people's jobs are on the line if we keep athletics, did you stop to think that other people's jobs are on the line when you cut athletics? Not to mention the scholarships that are made available to athletes (many of whom would not get the chance to obtain higher education without athletics). And not to mention the practical experience gained by student tutors, student trainers, and a host of other service-learning and practicum opportunities made available to students across the university. And not to mention that there is a Top Three academic program in sports management that, without the training grounds of athletics, would wither away under your plan. When you advocate cutting an entire sector of the university, make sure to look beyond simple dollars and cents (though we've seen that there is still a 7 to 13 million dollar hole that you plan can't fill). Now, as for where the cuts should take place, all three "a"s, Academics, Administration, and Auxiliaries (aka student services, which is where athletics falls) should be trimmed back. There's a lot of Administrative bloat in the upper OU Administration, there's a lot of faculty deadwood on the Academic side, and Auxilaries (from intercollegiate athletics to dining services to resident halls) has redundancies and many opportunities for outsourcing. In short, cut back everything.

ludwig

Since this started check out how many administrative positions have been added. Also even if you say to leave athletics alone does it make since to put an additional $1.2 million into the athletic budget out of the general fund? Good money after bad in my opinion. Say what you want but being an alumni and talking with many of my friends, they don't support OU in any shape or form. Not so much because our sports suck (they have for years) but because of the direction the University leadership is directing us.

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Finance chief: Deficits at OU will force hard decisions

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