Why is the university discussing potential reductions in state funding?
Governor Bruce Rauner has proposed a 31.5 percent decrease in state funding to Illinois public universities as part of an effort to balance the state’s budget, which has been running a serious deficit, in the next fiscal year. This would reduce funding for the Carbondale campus by $32 million, and for the School of Medicine, including the Simmons Cancer Institute, by $12 million. The Edwardsville campus would lose $19.6 million.
What do state appropriations cover?
Most of our state appropriation supports faculty and staff salaries and wages. Our faculty and staff are the backbone of the institution as they fulfill our core academic mission, provide essential student support, and deliver research and service that contribute to the economic vitality of the region and state.
What would a budget cut of that size mean?
A 31.5 percent reduction would result in a state funding level last received in the mid-1980s. It could drastically affect the university’s core academic and research mission, its service to the region and state, and student access and affordability.
Has the university made any cuts in response to the state budget so far?
To help balance the state’s $1.6 billion shortfall in the current fiscal year, state agencies are being asked to return 2.25 percent of their FY15 appropriations. In addition, a number of state grants have been suspended in the current fiscal year.
Will SIU really need to cut $63.6 million from its budget in one year?
We hope not. The cuts proposed by the governor must be vetted by the state legislature. The university and system are working hard to make the case that a cut of this magnitude would be harmful to students, to the region, and to the state.
I have heard that this represents a cut of only about 6 percent to our budget, not 31.5 percent. Is this accurate?
This statement is being made because if one looks at all of the university’s budgets, including its operating and capital budgets as well as the endowments held by the university’s foundations, the total is much larger than the $104 million we receive in state appropriations. However, it is important to understand that universities cannot move money from the capital budget to the operating budget, and endowments and other gifts are almost always restricted for specific purposes by our donors. State funds are the largest contributor to our largest expense, our faculty and staff, and we do not have much if any flexibility to pull from other budget sources to make sure our employees can fulfill our mission.
Is it possible that there could be no cuts?
It’s possible but not probable. We know that higher education must do its part to balance the budget, and SIU has worked hard to remain focused on its mission in spite of previous cuts to our budget. We are hopeful that we can work with the legislature to minimize the size of any cuts if not eliminate them entirely.
When will we know what the actual figure will be?
The goal for the legislature is for a budget to be finalized by May 31, 2015, for implementation before July 1, 2015, the start of the fiscal year. However, given the complexities of the state budget and political realities, it is possible that a final budget will not be approved until much later.
How is the university preparing for potential cuts?
Each university campus is using its own approach to determining what might be cut. Overall, all campuses hope to minimize the impact of cuts on core academic programs and critical student services.
Will there be layoffs?
Possibly, but we will not know until we know if there is a cut and how large it might be. If the full cut is implemented, it could affect more than 700 positions across all employment categories at SIU Carbondale, including the School of Medicine, and SIU Edwardsville. This would be devastating to the university and to our staff as well as the region’s economy.
Can the university offset cuts through tuition and enrollment increases?
To fully offset a 31.5 percent budget cut, SIU Carbondale would need to increase tuition by 90 percent, and SIU Edwardsville would need to increase tuition by 112 percent. Obviously, this is not realistic if we are to remain accessible and affordable.
Can the university offset potential cuts through endowments?
Unfortunately, no. Most funds from our donors are restricted for specific purposes identified by the donors, such as scholarships or research, and cannot be used to backfill state budget cuts. We cannot and would not legally or ethically violate the wishes of our donors.
Can the university increase fundraising efforts to help offset cuts?
The SIU Carbondale and Edwardsville foundations, in partnership with the campuses, are actively working to identify fundraising priorities and grow private support. However, this will take time, and privately donated funds are usually restricted for specific purposes.
Can the university generate new revenue to help the budget?
The university is always looking for new ways to generate revenue to remain accessible and affordable to students. We will certainly continue to do so aggressively in the face of potential budget cuts. Unfortunately, we must be careful not to price tuition, a major revenue source, beyond the reach of our students, and other revenue-generating operations may be hampered in their ability to grow revenue if they must cut back operations due to state budget reductions.
What is the role of the system office and the SIU Board of Trustees?
The system president and SIU’s Office of Governmental and Public Affairs, which is responsible for legislative relations, represent SIU Carbondale, SIU Edwardsville and all other aspects of the system with state legislators. Budgets are developed at the campus level, vetted and finalized by the system office, and approved by the Board of Trustees. The board also approves tuition and fees as part of the overall budget process. SIU’s trustees have been briefed on the potential impact of budget cuts.
What is the university doing to oppose these cuts?
The SIU system, through the president and the Office of Governmental and Public Affairs, is working closely with legislators locally and across the state to make the case that the university is an investment in the state’s future economic prosperity. For example, here are some statistics being shared about SIU’s impact on the region:
- The economic impact of the 31.5 percent reduction to the SIU system would be nearly $500 million to the Southern Illinois economy.
- For every state dollar spent, SIU Carbondale generates approximately $7.72 in economic impact, while SIU Edwardsville generates approximately $8.60.
- For every state dollar the SIU system receives, it returns approximately 41 cents in state and local tax revenue; a 31.5 percent reduction would reduce state and local taxes by more than $25 million.