"We are cutting into bone - muscle and bone."

That's what happens, said University of Montana President George Dennison, when an efficiently run university is asked to cut its base budget further.

This week, Dennison will present the Board of Regents with the university's plan for permanently shedding $3.6 million from its annual base budget, to plug a hole caused by the disappearance of one-time federal stimulus dollars.

The plan recommends cutting $1.4 million in personnel costs and $1.9 million in operations. That may mean fewer adjunct professors, less overtime pay, increased teaching loads and allowing vacant jobs to go dark.

Both students and faculty will feel the effects.

"Cuts of this magnitude, you can't avoid it," Dennison said.

Earlier this year, the regents asked all universities in the state to come up with ways to cut their base budgets, funded by the last legislative session using one-time federal stimulus dollars to the tune of $17.6 million. The money helped maintain operations at the current level.

But that money will disappear in July 2011. Now, universities and colleges in the state are looking internally, in large part to make up the loss of revenue in the 2012 biennium.

Last month, UM administrators held a series of town hall-style meetings on campus to alert faculty and staff about the potential cuts.

Furloughs were mentioned as one possible solution, but are not included in the most recent proposal. Eleven unions represent 90 percent of the campus work force. The university would need the bargaining units to agree in order for that plan to work, Dennison said. Plus, furloughs would not save enough money unless permanently implemented.

UM is also looking at ways to boost cash flow.

One such proposal, which Dennison suspects will stir some debate, recommends that the regents distribute more state money to colleges and universities with the highest number of enrolled Montana residents. UM has the highest enrollment in the state and would most certainly benefit from the recommendation.

Although the regents had previously instructed universities not to rely on tuition increases to cover the funding shortfall, UM proposed a slight tuition increase of 1.5 percent.

"You shouldn't take any cards off the table," Dennison said. "They said develop a plan."

Other items in the plan include:

Re-examining the cost of credits. Right now, full-time students pay the same price whether they take 12 credits or 21 credits. UM is considering raising the price for students taking more than 12 credits.

Increasing the transaction fee for students paying tuition using a credit card.

Scaling back on travel expenses, printing and copying budgets and rental spaces for UM-affiliated, off-campus institutions and programs.

Matt Fennell, president of the Associated Students of the University of Montana, supports some of the proposals, but not all. Re-evaluating the necessity of vacant jobs is a good idea, he said. Saving thousands of dollars by cutting back costs to Culligan Water for filtered water is also good, he said.

Tuition increases, heavier faculty workloads and scaling back on overtime pay are harder to swallow, Fennell admits.

"We need to explore all options to prevent a tuition increase," he said. "Students can't keep footing the bill and the university can't keep cutting and cutting and cutting if we want to maintain a high-quality education."

The bottom line, Fennell said, is the universities in Montana need more state support.

"The state has to invest in students," he said. "The state needs to fund higher education."

For now, these are all recommendations, Dennison said. Some proposed reductions may not save as much money as budget analysts originally estimated. And yet UM tried to craft a proposal that was manageable. For example, the campus budgets $1.5 million for overtime and extra compensation. The proposal calls to cut less than a quarter of that amount.

The regents will need to sign off on some of the proposals.

Others, such as re-evaluating vacant jobs and whether to fill them, are things UM can begin executing as early as January, Dennison said.

The regents are not scheduled to vote on these proposals this Thursday and Friday when they meet in Bozeman.

Reporter Chelsi Moy can be reached at 523-5260 or at chelsi.moy@missoulian.com.