By Lori Dresner, Managing Editor/New Editor
A handful of students gathered in the SGA Chambers on April 19 to hear panelists discuss the internalities and externalities of the budget deficit and projections for the upcoming fiscal year at the University of Missouri–St. Louis.
The panelists included Chief Financial Officer Rick Baniak, Dean of the College of Business Charles Hoffman, Chancellor Tom George, and Associated Students of the University of Missouri (ASUM) representative Jordan Lucas, senior, economics.
Baniak said that administrators and faculty have been working collectively over the past year to analyze expenditures and determine if the right amount of money is being invested in the right places while looking to improve recruitment and ensuring that the student experience is as strong as it can be.
“The sum of all those things together has put us into a spot where we’re actually ahead of plan, and it looks like we can balance our budget for [fiscal year] 17. So I think to the credit of everybody on the campus, we’ve actually overcome … a big hurdle,” said Baniak.
Baniak said that the university, however, will likely be looking at an even higher $17 million hurdle that it must overcome in FY18.
He explained that fiscal year 17 was set up to be a difficult year for UMSL from the beginning. The university was facing a $15 million deficit when discussions about FY17 first began.
In light of the $15 million deficit, Chancellor George and his leadership team set in place a plan to reduce that deficit to $3.6 million, which thus came to be known as the Budget Deficit Reduction Plan. That plan was to be implemented over a two-year period with about 75 percent of the benefits from reductions expected in FY17 and the other 25 percent in FY18. So far, Baniak said, the reduction plan has been successful.
“The plan that [Chancellor George] has put in place has been executed, and it’s worked just the way it was intended to,” said Baniak. “That’s allowed us to stay on track to the $3.6 million commitment that we made.”
Despite the success of the budget reduction plan, however, an additional $4.3 million reduction in state funding to the university in January worsened the current budget situation, expanding the projected $3.6 million deficit to $7.9 million.
“We’re in kind of a realignment mode … realignment of budget expenditures and budget revenue,” said George. “We’re actually doing very well to end fiscal year 2017.”
George said that the university will be entering FY18 with the input of a fully shared governance process that includes students, both tenure-track and non-tenure track faculty, and staff.
FY18 will begin July 1. UMSL will likely face similar financial challenges in FY18, according to Baniak, because the university is expecting that the $4.3 million cut in state funding will increase to $4.6 million next year.
One uncertainty relative to the budget lies within enrollment for the fall semester. Though attendance was high at UMSL Day, Baniak said that the university is still expecting a five percent decline in total enrollment for the upcoming semester, as total enrollment was down about five percent last fall.
The size of the student body depends on how many students graduate, how many students the university retains, and how many students the university recruits.
Lucas, a student lobbyist for ASUM, discussed his perspective on the budget shortfall relative to the reduction in state funding to the university. He said that UMSL is often the first institution to see funding decreases because that funding can be made up through alternative sources of revenue.
“Obviously, we have ways that we can raise funds outside of tax revenues from the state, but it also means that … we’re one of the first they look to because they know that we can make up for it with tuition increases,” said Lucas.
Hoffman added that some prospective donors and alumni are even reluctant to donate to UMSL because it is funded by the state, and many are under the impression that a large amount of state funding is allocated to the university.
“It’s not that well known that such a small percentage comes from the state now,” said Hoffman.