Options to cover $16M UM budget gap could include personnel cuts

2013-04-03T10:30:00Z 2014-10-19T08:07:28Z Options to cover $16M UM budget gap could include personnel cuts missoulian.com

Projecting an estimated budget gap of $16 million next academic year, the University of Montana is looking to trim costs, a discussion that could include cutting personnel.

The state’s largest university saw enrollment dip last fall by roughly 700 students, a number that school officials have blamed on poor publicity surrounding recent scandals and fewer high school graduates.

While administrators already have made a litany of one-time cuts this academic year to cover the gap, deeper adjustments may be carried into next year.

“We’re projecting about a $16 million increase in costs next year over this year,” said Michael Reid, vice president for administration and finance. “We’re not going to have less money next year than this year. It’s based on increased operating costs.”

Reid said Tuesday that as the university develops its 2014 budget, it may have options beyond cutting expenses to narrow the funding gap. Generating new or additional revenue could help, he said.

Yet much of that will depend on fall enrollment, and that won’t be known until mid-summer. Campus vice presidents are considering a list of options to deal with the shortfall, including cuts ranging from 2 percent to 8 percent, though retirement and attrition within departments could also help.

“There will likely be reduced operations across all areas of the campus based on an evaluation of student enrollment,” Reid said. “I don’t expect significant changes, if any, to institutional offerings.”

Reid said it’s likely that the university will have to scale back its resources, either through cutting personnel in low-demand areas, or through other financial expenditures. Tenure-track faculty members are protected from any potential cuts.

Reid said all budget considerations are based on the ebb and flow of the student population, along with the mix of students in that population. Students attending UM from out of state pay more in tuition, as do graduate students, for example.

“We’re seeing some positive indicators in our enrollment numbers for 2014, so we may adjust the revenue projections up a little bit, and that will also help reduce the projected shortfall,” Reid said.

When the university saw record-high enrollment in recent years, funding from the Montana University System increased, along with revenue gained from tuition. The school added positions and programs to meet the rising demand, and it must now scale back as demand drops.

***

UM President Royce Engstrom said the 2014 budget won’t be known until the legislative session ends and the Board of Regents convenes in May.

“I have instructed the vice presidents who oversee sectors across campus to plan for a reduced budget,” Engstrom said in a recent letter to the campus community. “They are working to minimize the possible impacts on people and expect to be able to manage most of those impacts through retirement and attrition.”

Much of the university’s administration was off this week during spring break. But in his letter, and in past interviews with the Missoulian, Engstrom has said UM is looking to invest in new areas, while generating revenue beyond tuition and what it receives in state funding.

Among the goals, Engstrom said, the university plans to dedicate more resources to student recruitment while increasing its contact with student prospects. Engstrom said UM also must offer heftier financial aid packages, saying that move is needed to stay competitive with other universities in the region.

Reid said the 2014 budget projections are based on the school’s $167 million educational and general budget. While the budget does not represent the university’s overall budget, it does cover general instruction and support operations.

“These budget projections are primarily a factor of what’s going on with enrollment, and not how we’re being funded by the Legislature,” Reid said. “We have to recalibrate our operations given the projected enrollment. That means we grow operations as we increase students, and have to make the necessary adjustments in the years when our enrollment dips.”

Reporter Martin Kidston can be reached at 523-5260, or at martin.kidston@missoulian.com.

Copyright 2015 missoulian.com. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

(17) Comments

  1. BobbyLee
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    BobbyLee - April 04, 2013 12:33 am
    Well said.

    Engstrom has completely lost the plot. Just yesterday he demanded that UDS send out a 'blast email' to advertise, yet again, the Griz Burrito. Not realizing that they had already lost that contest.

    It begs the questions: Does he have nothing better to do that advertise a freaking burrito? And, the obvious, why wouldn't he see if the contest was still valid before demanding they advertise it, again?

    I guess stupid is just stupid, no matter how much money you make and how many degrees you have.
  2. BobbyLee
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    BobbyLee - April 03, 2013 11:09 pm
    Education should no longer be a business. With online learning it is an opportunity for everyone; young, old, learned and ignorant. Only money is hindering this process. So are you on the side of the money, or on the side of education? It's really that basic.
  3. BobbyLee
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    BobbyLee - April 03, 2013 11:01 pm
    This one comment by you is absolutely priceless, and if you seriously cannot appreciate the abject irony in it is rather sad:

    - "Sorry Bobby, I can work at a restaurant, drive truck, or work in a nursing home even with a degree'
  4. bsfarm8
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    bsfarm8 - April 03, 2013 6:20 pm
    Fantastic, that is exactly what we need. I can't believe we are not moving toward it faster. If you could ever find an administrator available for comment and not on a "break," maybe we could get some answers.
  5. Alan Johnson
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    Alan Johnson - April 03, 2013 3:35 pm
    hmmmm ... er ... so exactly why did you respond?
  6. hellgatenights
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    hellgatenights - April 03, 2013 2:09 pm
    Excellent comments....every one of them. I am glad I came back to read them.

    Can anyone help me understand why there is such a disconnect between the regents and the student body? The fact the Engstrom is still here is proof that the regents will not insist on "Montana" standards and are derelict in their duties.

    How......can we replace them? Are they here at the behest of the governor?
  7. BobbyB
    Report Abuse
    BobbyB - April 03, 2013 1:43 pm
    What Engstrom, and academia in general, are loath to admit is that in another five to ten years all those multi million dollar class room buildings will be slowly turned into high-rise condos, and the campuses transformed into city parks, and recreational areas. The technology has already been designed to replace the vast majority of professors with desk/lap top inter-active computer programs, which will offer superior results for a fraction of the cost of what is being paid now for an inferior education. The advantage of sitting in a virtual classroom taught by the very best of the best educators far out weights the social benefits of attending classes where only a small percentage of your college class mates really want to be there, including half the professors. New methods of presenting information, and how the brain reacts to it along with viable means to gage the individuals ability to retain that information will acculturate our educational system beyond what is even possible with our present system. The savings will be astronomical, and will for the first time in history bring higher education to anyone who wants it.
  8. compounder
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    compounder - April 03, 2013 10:34 am
    Half the 900 student enrollment drop is due to Missoula College. For which faculty and staff on the main campus are going to be paying with their jobs, all for the sake of a bunch of administrators and politicians getting their names on new buildings. Buildings that won't be needed.
  9. Lamplighter
    Report Abuse
    Lamplighter - April 03, 2013 9:56 am
    UM has now stooped to "buying" students like some barber college or bartending school for one obvious reason...it can no longer use the traditionally best resource for proselytizing...the recommendation of those already attending or recently graduated. A month ago, as did many UM alums no doubt, I received a solicitation letter asking my help in funding a student recruitment campaign. Yeah, right!... The University of Montana, this corroding bastion of liberal think, is rotting from the inside out. And the decay runs from Main Hall all the way to Helena and the rubber stamp gang called The Board of Regents. In President Waded Cruzado MSU got the goldmine. In Royce Engstrom UM got the shaft...It's spring housecleaning time!
  10. J555-5
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    J555-5 - April 03, 2013 9:33 am
    The article mentioned tenure-track professors not tenured. Tenure-track professors are probationary and can be let go at the end of school year with proper advance notification. It's more difficult to fire go a tenured pofessor but it has been done before.
  11. Yellowdog1
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    Yellowdog1 - April 03, 2013 8:47 am
    Still kills me the way that went down, amazing his predecessor mad approximately half. In addition lets not forget the fring benefits. Beautiful home, car, plane, all expensis literally. Administration definately needs to be thinned starting with Engstrom. He made many blunders in the rape investigations, bordering on lying to the public.

    As a huge sports fan it pains me to say, we need to eliminate or greatly restrict the financial aid tot the student athlete. Recently it came out the average expense for NCAA athletes was $100K each. Make ALL sports club sports sink or swim on there own. Give scholarships only to athletes. The remainder should be sink or swim for travel, facilities, gear etc.

    Problem fixed.

  12. accobra
    Report Abuse
    accobra - April 03, 2013 6:45 am
    I totally agree with getting rid of the teachers that have been there forever and are just coasting along letting student teachers and aides run their classes. And they should be getting rid of Engstrom too!
  13. chaffincreek
    Report Abuse
    chaffincreek - April 03, 2013 5:58 am
    Bobby Lee propensity for angry diatribe is demonstrated quite clearly in his letter. The URL he gave directs you to the Telegraph in the UK. (http://www.telegraph.co.uk/finance/comment/9967240/Tell-youngsters-the-truth-the-UK-needs-you-to-work-not-go-to-university.html) Notice his statement -"Research from the US government... suggests that just one out of the top nine occupations expected to create the most jobs this decade requires a university degree.” conveniently leaves out the clause “which without doubt applies equally to Britain,” The nine occupations, which mysteriously turn to 10 in the article he cites, are precisely why many go to college in the first place: “Among the top 10 fastest-growing professions are retail sales staff; food preparation (including fast-food restaurant jobs); customer service reps; labourers and freight, stock, and material movers; lorry and van drivers; and various healthcare aides, related to the ageing population”

    Sorry Bobby, I can work at a restaurant, drive truck, or work in a nursing home even with a degree. College is much more than a mill to turn out little workers for commercial industry.

    His last paragraph is simply a diatribe against the University of Montana and offers no documentation to support his claims.
  14. bsfarm8
    Report Abuse
    bsfarm8 - April 03, 2013 2:19 am
    I know how UM could save...and be all the better for the cut....

    "The compensation package approved by the regents mirrored that of Montana State University President Waded Cruzado, who was hired a year ago. Engstrom's annual salary will be $280,000. In addition, he will receive a $500,000 deferred compensation package, which has never been offered before at UM."

    You talk about one of the worst blunders in UM history....You can't get one of those OVER paid administrators to admit what is an obvious problem. The poor leadership and the series of disastrous decisions by them have devastated UM.
  15. BobbyLee
    Report Abuse
    BobbyLee - April 02, 2013 11:38 pm
    - "Engstrom has said UM is looking to invest in new areas, while generating revenue beyond tuition and what it receives in state funding."

    That "generating revenue" involved, only yesterday, asking for donations from all university staff! Donations from staff making one-tenth of his salary.

    - "Tragically, as yet more data reveal, the decision to massively increase the number of school-leavers going to university, wrongly assuming that this would transform opportunity in an era of technological revolution, ranks as one of the greatest social and industrial policy blunders of recent decades."

    -"Research from the US government... suggests that just one out of the top nine occupations expected to create the most jobs this decade requires a university degree."

    - "Apprenticeships and vocational qualifications are essential: had politicians focused on these in recent decades, rather than on boosting university admissions at any cost, the prospects for young [people] would be very different today." - http://cl.ly/3l1T1e2M1s3s

    It's long passed time to stop throwing money at an outdated education system -- especially one so unnecessarily administratively heavy. One where administrators such as Engstrom are no different from the cold-calling insurance salesman; selling a product that is, at best, questionable, and at its worst leaves people in debt up to the eyeballs for years for no purpose other than a piece of worthless paper. Hey, even the U.S. Government just admitted it. When is the UM going to admit it? Or is the UM's sole purpose these days its own survival, while putting our kids in hock to achieve it?
  16. hellgatenights
    Report Abuse
    hellgatenights - April 02, 2013 11:13 pm
    Engstrom said UM also must offer heftier financial aid packages, saying that move is needed to stay competitive with other universities in the region.

    This comment is so stupid it does not merit a response.
  17. hellgatenights
    Report Abuse
    hellgatenights - April 02, 2013 11:12 pm
    Right......so that concludes the discussion on the proposed new adult school building, a bad idea that has no funding.

    Next, contrary to this article, tenured professors can be eliminated under certain circumstances. So make it happen, and get rid of some of the progressive deadwood festering the halls at the UofM.
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