Committee, gov. clash over higher ed budget

Significant decreases to Gov. Ted Kulongoski’s recommended budget by the state Ways and Means Committee could cost Portland State its renovation projects and force additional budget reductions.

Significant decreases to Gov. Ted Kulongoski’s recommended budget by the state Ways and Means Committee could cost Portland State its renovation projects and force additional budget reductions.

The co-chairs of the Ways and Means Committee, which reviews and adjusts the governor’s proposed state budget, proposed to reduce Kulongoski’s statewide general funds budget by $180 million, or about 1.2 percent.

A big slice of the reduction came from the Oregon University System, where the committee reduced Kulongoski’s operating budget by about $33 million, from $827 million to $794 million. The committee eliminated $8 million from a $40 million package meant to increase faculty salaries, reduce the faculty-to-student ratio and give support to Southern Oregon University and Eastern Oregon University.

PSU Provost Roy Koch said an 85 percent reduction in the capital construction budget was the biggest hit to PSU. Kulongoski proposed $76 million in construction projects for PSU alone, $23 million more than the Ways and Means Committee proposed for all Oregon schools.

Kulongoski proposed around $420 million in capital construction projects for the entire Oregon University System. The Ways and Means Committee reduced that number to about $63 million for construction, renovation and maintenance projects.

The reduction would scale back or cut the repairs to Lincoln Hall and Science Building 2 altogether, which were slated to cost $29 million and $46 million respectively.

“People’s jaws hit the ground when they saw that,” Koch said about the 85 percent cut. “We’ve got to get some of that construction money back.”

The effect that this lowered budget could have on PSU is negative, according to Lindsay Desrochers, PSU vice president of finance and administration, but it is not the worst-case scenario.

“The governor’s budget was just a starting point for getting us back on track,” Desrochers said. “They have to understand the implications of what they’re doing there.”

“There’s a lot of disappointment,” Koch said.

The University Budget Team, a collection of PSU administrators, was already working to fix a $5.2 million budget deficit and only had to modify its plan slightly to work with the co-chair’s budget.

The plan now is to find as much as $6 million to cut: close to $3 million for a reoccurring shortfall and about $3 million to replenish the PSU fund balance, an emergency savings fund that PSU is required to maintain.

Desrochers said PSU would optimally maintain a 10 percent balance of it’s $199 million of general funds. Currently the balance is around 8 percent.

Administrators plan to increase revenue and cut expenditures instead of eliminating positions. The new budget will increase graduate tuition costs by $650,000, replace numerous retired full-time professors with lower-paid part-time professors, and look for more non-resident freshmen.

Administrators plan to delay equipment purchases to save $540,000, and also plan to save $1 million in utility costs.

Bringing in 105 new out-of-state freshmen would pull in $1 million for the school, Koch said. The faculty senate and PSU President Daniel Bernstine must approve the budget when the budget team finishes a proposal.

More specifics about where cuts are going to be made in the university budget are not known at this time because it is early in the budget process, Koch said.

“The basic strategy is to try and keep the doors open and paychecks flowing in some level,” Koch said.

The Ways and Means Committee budget is a modified version of the governor’s recommended budget that will be the basis for the entire legislative budget process. There are still three months left for the Legislature to finalize the state budget.

The effects on PSU and all Oregon colleges are significant, Desrochers said. “We’re not in this alone,” she said.

The committee cut $25 million from the budgets for Oregon’s 17 community colleges, about 5 percent of the $483 million recommended by the governor.

The Ways and Means Committee increased Kulongoski’s recommendation for the K-12 budget by $185 million, from $6.06 billion to $6.245 billion.

If the budget goes through as proposed, it would take state support for higher education down to 16 percent of the general fund. This would be a record low, according to Desrochers.

Bernstine recently released a statement decrying the proposed budget. The statement promised that Bernstine would work with the Legislature to restore the funding to its previous anticipated level.

“The budget plan continues the disinvestment in Oregon’s higher education at a time when other states are making substantial commitments to their universities,” Bernstine said in the statement.

Desrochers and Koch both said that it is too early in the process to count PSU out. They said a group of alumni are planning to lobby extensively to the Legislature.

A PSU day is planned at the Legislature in Salem on April 10, sponsored by the PSU Alumni Association. The theme of the event is “Focus on Faculty,” and appointments can be made with legislatures to lobby for Portland State.

Chair of the Faculty Senate Budget Committee Ray Johnson said administrators have been open and available during the budget planning process. He said faculty could submit input and comments by April 11 for consideration. He said the process is going smoothly.

“This is probably the most transparent budget process I’ve seen during my time here at PSU,” Johnson said.