John Peters

President responds to governor's budget message

by Melanie Magara

Citing "mixed feelings" about a financial plan that spares NIU from the most drastic scenarios but cuts deep into resources for the coming fiscal year, President John Peters last week responded to the governor's budget address with caution.

"I write to you today with very mixed feelings about the news we have just received from Springfield," Peters said in an e-mail to faculty and staff. "Today's budget message from Governor Blagojevich revealed his intent to limit drastic cuts to the FY03 budgets of public universities, but requires even greater sacrifice from all of us in FY04."

The worst-case scenario - in which NIU would have been required to send back more than half of its remaining FY03 state dollars - was averted. That proposal (8 percent of the entire year's budget in the remaining three months of the fiscal year) was trimmed back to 2.9 percent, or $3.2 million. At that level, the president said, summer school could proceed as planned.

Peters said he was relieved to see the smaller reserve requirement for FY03, but reminded staff that even the smaller amount represented "a cut on top of a cut on top of a cut."

"At the beginning of this fiscal year, we initiated measures that anticipated further reductions in state support," Peters said. "Those measures included freezes on new hires, equipment purchases and non-essential travel, and the elimination of 46 positions. Other actions included development of internal reserves and negotiation of extended payments on outstanding utility bills. With an exact reduction number now in hand, we know we must take several additional actions to fully meet the governor's FY03 reserve requirement."

Among the new actions under consideration is the initiation of a four-day summer workweek, as well as temporary summer building closures. Money saved by lowered utility, maintenance and security costs will be applied to both the FY03 and FY04 shortfalls. Peters said the idea was being discussed with campus leadership, with a final decision and specific guidelines to be announced soon.

The president told staff he was more troubled by news about FY04, the fiscal year that starts July 1. The governor's plan calls for base budget cuts of 8.2 percent in that year, leaving NIU to operate on about $9.1 million less than it had at the beginning of the current fiscal year.

"Since the beginning of this budget crisis nearly two years ago, we have endured budget cuts and unavoidable cost increases totaling $13 million," Peters said. (This includes $3.5 million in employee health insurance contributions which the state imposed on universities last year and which has been continued into next year.)

"With today's announcement of an additional $9.1 million cut, NIU's base budget level has been driven back the approximately six years, to a level we have not seen since the 1997-1998 school year," he explained.

In spite of the dour financial news from Springfield, Peters remained optimistic about the university's ability to manage its way through the lean months and years ahead.

"The great thing about NIU is that we pull together in tough times. We're going to make it through this crisis because we're prepared, and because we have continued to stay together and stay focused on our service to students," Peters said.

"While we have been waiting for release of the governor's budget before making
specific statements, I assure you that we have been working diligently to manage these cuts while remaining true to the principles I laid out nearly two years ago," Peters explained. "At every level of this university, we have looked for ways to reduce spending without damaging the integrity of the academic program, without threatening the livelihood of large numbers of employees and without endangering the health or safety of any member of our campus community."

Peters said specific action plans are in the works, and that he would continue his practice of communicating with the campus community as soon as decisions have been made and new information becomes available. For the time being, the president said he has asked the campus leadership to explore several new money-saving strategies:

• Implementation of a four-day workweek beginning in June and continuing through the summer months. This change in schedule would not affect salaries, but would allow the university to recognize significant savings in utilities, contractual services and other expenditures.
• Possible consolidation of classes and operations to allow temporary closure of some buildings over the summer. DuSable Hall is one such facility.
• Closing all campus buildings at 11 p.m. during the summer.
• An extended winter shutdown.
• Reductions in all but health-and-safety-related maintenance and repairs.
• Limiting admissions.

Peters said many other streamlining ideas would be discussed in coming weeks, but emphasized that budget cuts are only part of the picture. Pending legislation that would impose limits on tuition and otherwise constrain university flexibility are of equal concern to NIU administrators and trustees.

"Our work from now until the end of the legislative session this summer will focus on proposed legislation that threatens our flexibility in responding to budget crises, increases in enrollment and other financial issues," Peters said.

"To that end, I want to thank all the faculty, staff, students, alumni, board members and others who have contacted legislators on behalf of NIU," Peters added. "It absolutely does make a difference."

4-14-03