Volume 67, No. 12
THE PAN AMERICAN
December 2, 2010
MAKING LEMONADE Nelsen: ‘concerned but confident’ as University prepares for extensive budget cuts By Roxann Garcia The Pan American A state budget shortfall as high as $25 billion is projected as lawmakers prepare for the 2011 Legislative session in mid-January, but administration officials at The University of Texas-Pan American have contrived a plan to avoid as much damage as possible. “After discussions with the Legislative Budget Board, the UT System has asked the fifteen universities in the system to prepare for a possible worst-case scenario,” President Robert S. Nelsen said in a memo sent to faculty and staff Tuesday. The university is strategizing a contingency plan in the event the state mandates up to a 15 percent cut on top of the 5 percent already taken and an expected 3 percent slash. The final decision won’t be made until the end of the Legislative session. The administration only has a month before the document is to be sent to the System Board of Regents prior to the session’s beginning. The work done so far is in preparation of an expected reduction of overall university spending at some point in 2011. The president and his cabinet held a meeting Nov. 17 with faculty and staff
senate chairs to discuss the important memo sent from the board. It was decided that the university would plan for a reduction of 15 percent in the Academic Affairs division and 20 percent in other areas. Whatever the final number ends up being in terms of reduction, each area will have a plan in place to comply with the rules. Nelsen stressed that the action so far does not add up to a “budget cut,” it simply does some homework so that the university will be ready to move once the final decisions are made. “We’ve got to have a cross-campus conversation to decide on the right kinds of reductions,” Nelsen said this week in an interview with The Pan American. “All we’ve had is: each one of the divisions has looked at itself and had to reach a target of what they need to do. So far, the cabinet has begun to meet with one another and discuss some ideas. But the conversations officially start in January.” STEP BY STEP In the wake of the global economic downturn, for the current FY 2010-2011 UTPA was asked to give back 5 percent of general revenue, amounting to $5,579,985. But it was only the beginning. “However, employee benefits are paid in proportion to funding between the state and the institutions,” said Juan C. Gonzalez, assistant VP and budget director. “This means that as state money becomes a smaller part of our funding, a greater burden for covering benefit expenses shifts to the institution.” The university estimated the amount at $1,227,597 for a total impact of $6,807,582. Keep in mind, however, Texas writes budgets biennially, or in two-year terms, so the shortfall affects the 2012-2013 state budgets. Dividing the $6,807,582 by two arrives at an annual slice of $3,403,791. The next phase included a reduction of 10 percent for the upcoming (2012-2013) biennium, for a sum of $1,818,835 for the two years. This has not been mandated yet, however, but rather is part of a proposed plan should the reduction be agreed upon during the Legislative session. “This 10 percent exercise can therefore be seen as somewhat perfunctory; reductions, if they occur, will likely happen to the formula and non-formula items, not just the non-formula items,” Gonzalez continued.
SEE LEMONADE || PAGE 7
Photo by Daniel Flores / THE PAN AMERICAN
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