Eastern Michigan University's 2008-2009 budget outlook sounds familiar.
It will largely be determined by enrollment numbers, which will, in turn, determine a tuition increase that could range anywhere from 5 percent to 9 percent, according to an early working draft of the budget.
The University's draft budget was discussed during a meeting between faculty and Don Loppnow, EMU's provost and executive vice president, at the Student Center March 10.
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Loppnow |
According to numbers provided in a handout by Loppnow at the meeting, Eastern Michigan's FY2009 budget could range anywhere from having a $2.4 million surplus to a $7.6 million deficit, depending on scenarios that factor in various enrollment numbers and tuition increases. For example, if EMU enjoys a 1 percent enrollment increase for next fall, coupled with a 9 percent tuition increase, the budget surplus would be $2.4 million. If fall enrollment projections were minus 2 percent — the worst figure forecast — and tuition was raised 5 percent, the budget deficit would be $7.6 million.
"This is an example of where we are. The budget picture becomes clearer in the next couple of months as we sharpen our pencils," said Janice Stroh, EMU's vice president for business and finance.
However, some faculty say they want the administration to be more proactive with the upcoming budget to avoid a repeat of last year when Academic Affairs was forced to take the brunt of a large budget cut at the eleventh hour.
"I want us to prevent what happened last July," said Howard Bunsis, an EMU professor of accounting and AAUP president. "That is going to affect new faculty hiring."
Currently, EMU's enrollment and credit hour numbers are down approximately 2 percent for the current winter semester. While he was not sure what the reasons were, Loppnow surmised it was likely a combination of a sagging economy, campus safety and security concerns, and students taking fewer credits during a semester than they did previously.
"Our enrollment issues are what we worry about for the budget. More than 70 percent of our operating budget is based on tuition," Loppnow said.
The University is expected to receive approximately $77.8 million, or a 2.3 percent increase, from the state for FY2009 under Gov. Granholm's proposal. However, that 2.3 percent is the minimum all state universities are to receive. Some universities, including the traditional research universities — including the University of Michigan and Wayne State — are expected to receive upwards of a 3.2 percent increase in state funding.
Loppnow expecs that there will be some political "arm-wrestling" about the percentage differentials.
"We think the governor's proposal of 3 percent overall is fine," Loppnow said. "But, we believe every university should receive 3 percent. Three percent is just trying to keep up with costs. We feel everyone should get that, not just some universities."
On a bright note, Pray-Harrold is listed at the top of Granholm's capital outlay budget for next year. Under her proposal, EMU would receive $44 million of the $57 million needed to renovate EMU's oldest and largest classroom building. Pray-Harrold has been on the Board of Regents' capital outlay request list for at least the past eight years. Eastern Michigan hasn't received capital outlay dollars from the state since 1996.
While those numbers appear solid, the administration and faculty — based on meeting comments — have to come to some understanding about what the real budget numbers are. Stroh indicated EMU is starting out in the hole going into the next budget cycle. Faculty say EMU's financial situation is not that dire and that the administration needs to factor in revenues to get a more accurate budget picture.
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Eisenbach |
Jamin Eisenbach, an EMU professor of biology, suggested the University hire an outside firm to "come up with a reconciliation for where the budget stands."
"We're really bad off or not so bad off," Eisenbach said.
"We've had a recent history of talking past each other," Loppnow said. "We should all sit in the same room."
Despite that difference in the way each side views the budget numbers, it was made clear that no major budget cuts were on the horizon — at least not during the current fiscal year.
"I've been hearing rumors that there is going to be a mammoth cut. No, we're not cutting anything," Loppnow said. "Any rumors about some draconian cut this fiscal year; it will not happen. If there is any shortfall this year, it will be addressed in the next fiscal year budget."
