January 03, 2013

President Martin's April update on budget: initial actions

by President Susan Martin, Published April 20, 2011

Dear Faculty and Staff,

As discussed in previous messages and as recently as last Thursday's Board of Regents meeting, we have been intensely reviewing the 2011-2012 budget and are prepared to begin rolling out some of our preliminary plans. I say preliminary because it is important to note that the items and plans presented today are only the beginning of the comprehensive process we have outlined previously.

President Susan Martin

These initial actions are being presented this afternoon at a meeting of the all-union council, representing all of the unions on Eastern's campus. They are being shared with the entire university community in order to ensure that everyone has access to the same information.

First steps include:

  • Implementation of a pay freeze for the  2011-2012 fiscal year for all employees not under union contracts;
  • Elimination of cell phone reimbursement (possible exceptions related to safety, security and contractual considerations);
  • Presidential approval will be required for all international travel and honorariums;
  • Presidential approval to fill open positions continues; and,
  • Divisional savings assessments continue - specific reductions, as indicated previously, will be strategic and not across the board.

These items mark the beginning of actions to address the expected 15 percent reduction in state funding (see further update on state budget process below). As stated previously, the principles that we will use to guide the budget process are:

  • Resource allocation focused on growth and building on momentum
  • Academic quality and campus safety and security are top priorities
  • Recognize importance of re-investment in aging facilities
  • Participation and ownership of need to reduce expenditures significantly
  • Budget structurally balanced and sustainable

We also outlined our approach to the process, which includes:

  • Transparent, frequent communication with full campus engagement
  • Re-assessment of all we do and how we do it

We will have an opportunity to discuss the steps we are announcing today and any updates to our actions at the next Budget Forum, which is scheduled for Wednesday, May 4, from 10-11 a.m. in the Student Center Auditorium. This will be our eighth forum since the summer of 2009, and we encourage everyone to attend.

In the meantime, work on the state budget continues in Lansing. The Senate Higher Education Appropriations Subcommittee approved a funding bill yesterday that is somewhat different than the Governor's proposal and that which was approved by the House Higher Education Appropriations Subcommittee.

I asked Chief Government & Community Relations Officer Leigh Greden to provide an analysis of the Senate funding bill:

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TUITION RESTRAINT: The Senate bill does NOT include any tuition restraint provisions. Gongwer reported that, "Sen. Tonya Schuitmaker, chair of the subcommittee, said the universities had pledged to keep tuition below the cap without the requirement." This differs from the House, which included the Governor's proposed 7.1% tuition restraint plan.

BUDGET: Unlike the House subcommittee, the Senate subcommittee voted to treat every university the same: All university funding was cut 15% across-the-board. For EMU, that would constitute a cut from $76,026,200 this year to $64,619,100 next year. This is $239,900 less than the appropriation recommended for EMU by the House subcommittee.

OTHER ITEMS: The Senate subcommittee bill is much "cleaner" than the House subcommittee bill, meaning it does not include many of the extra items included by the House. For example, the following items which were included in the House bill were NOT included in the Senate bill:

-- Requirement that universities post all General Fund salaries for employees,
listed by name and job title, on their websites;

-- Roadmap for FY13 funding;

-- Mandatory report on costs associated with seeking/maintaining program accreditation;

-- Mandatory report on rejected transfer credits;

-- Mandatory report on how graduate counseling programs treat Christian students;

-- Stem cell reporting; and,

-- Creation of committees to develop policies re: transfer credit and reverse transfer credit.

CAUTION: The Senate subcommittee used fewer dollars from the School Aid Fund, and made up the difference with General Funds. As a result, the bill authorizes spending almost $500 million MORE in General Funds than the House or the Governor. This could be a problem because those funds have not been specifically identified, and the General Fund faces more pressure than the School Aid Fund.

REMINDER: This is one more step in a multi-step process. This bill (and other appropriations bills) are expected to be considered by the full Senate Appropriations Committee soon.
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The full Senate Appropriations Committee is taking up the funding bill today so we may have an update to report soon. We will continue to follow and update you on developments in Lansing and our own internal budget process. Please feel free to contact me with any comments, suggestions or concerns at office_of_the_president@emich.edu.

Thank you,

Sue Martin