WSU Tri-Cities response
This last month, during a town hall presentation, President Schulz presented the university’s need to correct its course financially. In short, the University’s expenditures have been exceeding its revenues for some time. This practice has been draining the institution’s reserve funds. President Schulz outlined a series of actions to rebuild the reserves and strengthen our overall financial health.
System-wide, all units have been given the directive to maintain 2017 PBL budget as the continuing budget for the next three years. Also, we are required to reduce these expenditures by 2.5% annually for the next three years and place these revenues into reserves as carry-forward (a mandatory savings plan). Any additional revenues from increased enrollment or professional education or other revenue sources are to be placed into reserves for carry-forward with the understanding that the Chancellor may make prioritized requests to spend to accommodate for enrollment growth. These additional revenues can also be held in reserve to count toward the annual 2.5% mandatory savings plan. Funds saved from the above actions will be kept in the Tri-Cities reserves to improve the university’s overall financial position, rather than transferred to the central budget for use elsewhere in the university. We will continue to pay 11% on tuition revenues during the academic year and 8% during the summer session.
What does this mean for WSU Tri-Cities? We will take several actions, including the following:
- All campus units must return to and operate within the 2017 budget. However,
- Departments funded and budgeted by grants will not be reduced; and
- Student accounts funded through student fees will not be reduced.
- We must reduce the PBL 2017 budget by approximately $500,000 (2.5%).
- Each Vice Chancellor is conducting department-level discussions to identify expenditure savings and collect input on possible efficiencies and prioritize within their unit.
- The Executive Team will use a budgeting process similar to the Vancouver campus to prioritize target reductions rather than an across-the-board reduction.
- Weighted Targeted Reductions: Proportionately, Chancellor’s office and Finance and Administration will reduce expenditures first and by the greatest proportion. Second, Student Affairs and Research will reduce expenditures moderately. Last, Academic Affairs will reduce proportionate expenditures the least of the three.
- We must focus on increased student enrollment, retention, and completion as well as our summer session operations.
- We must identify and carefully consider other new revenue-generating opportunities.
- We must consider efficiencies across units and practice formative budget corrections to ensure operation within budget. Examples other university partners include:
- Reducing or deferring non-essential operating expenses;
- Discontinuing services that are not fully meeting constituents needs;
- Consolidating services to reduce duplication and cost, and to gain efficiency;
- Holding positions open as long as possible.
Once we receive our actual budget reduction amount from the Central Finance Office, we will begin the work on specifics. This will involve Vice Chancellors working with their respective directors, staff and faculty to identify and prioritize areas for savings to meet our expected target of 2.5% overall PBL expenditure reduction. A town hall will be held to share the details, goals and to explain the processes.
A challenge with this type of budgetary reduction is the fact we are already within the budget period and spending funds. The delayed legislative budgetary action has contributed to the overall delay in budget allocation. Over the next couple of weeks all personnel responsible for budgets are asked to minimize current spending to prevent the need for more drastic efforts to recovering savings. Once we have established budgetary targets from Central Finance Office, we will then be able to adjust and continue on our way through this budget cycle.
During this process, we would like to hear your ideas about how we can work together to accomplish these goals. Please share your ideas within your units and respective Vice Chancellors about ideas that address the parameters mentioned above. You may also send ideas to “firstname.lastname@example.org,” which will be entered into the budget discussion.