Jul. 29, 2014

State cuts $4.9 million from College budget

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October 17, 2008

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Virginia Gov. Timothy M. Kaine announced last Thursday that, due to state budget cuts, the College of William and Mary and the Virginia Institute of Marine Science must cut a total of $4.9 million from their budgets for the current fiscal year.

The cut represents 6.6 percent of all of the College and VIMS’s state funds. Last year, the state cut the College’s operating budget by $2.7 million.

The state faces a budget shortfall of $2.5 billion over the next two years.

Kaine cut the budget in the middle of a fiscal year, after the school had already begun operating according to a budget determined by government funding projections in April. Before the state formally decreased the budget last week, College officials had been advised by the state to anticipate a cut of up to 15 percent.

“Bad news from the state has been expected, and we have been planning for it,” College President Taylor Reveley said in an e-mail to the College community.

Despite not reaching the 15 percent cut that was warned by the state, the cuts are substantial, and the College must now find additional ways to decrease spending and increase revenue.

Reveley immediately froze all hiring and is leaving four positions at the College vacant.

As for future measures, Kaine and College officials hope a mid-year tuition increase will not be necessary.

“My hope and expectation is that we’ll be able to get through this fiscal year with no mid-year tuition increase and minimal impact on our academic program,” Reveley told The Flat Hat.

The College imposed mid-year tuition increases in the 1980s, economics professor Robert Archibald said, and the Board of Visitors of several Virginia state universities approved a mid-year tuition increase during the 2004 fiscal year.

“The cold reality is tuition is the principal source for funding,” Board of Visitors Rector Michael Powell ’85 said in a telephone interview.

Powell said he does not know yet whether tuition would increase this year. College officials have said that financial aid programs will not be affected.

“Our priorities moving forward will be protecting the academic mission of the College, protecting need-based student financial aid and working closely with the Board of Visitors, faculty, staff and student leaders in this process,” Vice President for Strategic Initiatives Jim Golden said.

Also, the College will not have to lay off employees, but the state has deferred a 2 percent salary increase until July.

Some adjunct professors — temporary professors that are usually hired for a semester or two — may not have contracts renewed, Archibald said. If an offer for employment during the spring semester has been already extended, that person is protected from the hiring freeze. If a department, however, has not yet begun reviewing adjunct contracts for the next semester, some contracts may not be renewed. This will result in fewer classes offered, Archibald said, making the class registration process more difficult.

Despite the hiring freeze, student employment will not be affected directly, but it could suffer if individual departments trim their budgets by eliminating student employees. The College asked each department to cut its individual budget by 5 percent several weeks ago in anticipation of the budget cuts.

VIMS, which operates under the administrative umbrella of the College, will absorb nearly $1.5 million of the $4.9 million budget cut. VIMS has a budget independent from the College because, in addition to being an educational institution, it is required to provide unbiased marine, natural resource and environmental information for the state. VIMS officials have made plans to significantly reduce its budget.

“We anticipate that the elimination of faculty positions by attrition will reduce disciplinary diversity and necessitate elimination of some graduate course offerings,” VIMS Dean John Wells said. “Equipment purchases will be reduced, library subscriptions may be cut and it will be hard to keep the competitive edge we have worked hard to develop over the past 20 years.”

Wells added that VIMS is turning its focus to securing private funding and grants.

Though this year’s cuts will pose problems for the College, officials anticipate the next fiscal year will be even more damaging.

The College’s budget cut comes as a result of Virginia’s $2.5 billion two-year budget shortfall. In addition to withholding $279 million from state agencies, including the College, Kaine proposed withdrawing $400 million from Virginia’s “rainy day fund,” a state reserve fund, to help cope with the budget shortfall. The remainder of the funds will come from bond funding and deferred salary increases.

If the state finds itself with a budget shortfall next year, cuts will be harder to cope with.

“When the governor and the Virginia General Assembly look at the next fiscal year, they are going to have to find money from state institutions and agencies across Virginia,” Vice President for Finance Sam Jones said.
“We don’t know what it will mean for the College.”

Much of what is happening in the state is a result of the floundering world economy, as markets worldwide are tumbling almost daily.

“The Board of Visitors is doing its best in this financial hurricane,” Powell said. “What is happening on a national scale is reverberating on a state scale.”

The country’s financial woes are affecting other funding sources as well.

“Our financial challenge isn’t simply another reduction in state funding,” Reveley said. “Because of economic trouble in the United States and abroad, the amount of money available from our endowment to help fund College operations will decline. So also will the capacity of our private donors to make new gifts to William and Mary.”

While the BOV is not formally lobbying for more funds, Powell said, many members are working in Richmond to protect the College’s interests. Until the economy begins to recover, the College will continue to see budget cuts.

The state likely will elect to replenish the “rainy day fund” before restoring the College’s budget, Archibald said. Even in a healthy economy, many states have been decreasing higher education funding in favor of keeping social programs like Medicare funded with fewer taxes.

“In 1980, the commonwealth provided the College more than 40 percent of its total operating budget,” Golden said. “At the College today, the state provides 18 percent of that operating budget — an amount for which we are truly grateful but on which we cannot survive, much less thrive, in a competitive world.”
Much is still uncertain, but officials agree there is no doubt the College will face future budget cuts and some programs may suffer.

Reveley encouraged students to attend the forums, being held in the coming weeks to discuss how they think the College should deal with its budget crisis.

“Along with all other colleges and universities around the country,” Reveley said, “we confront difficult financial times.”

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