University faces $6 million in budget cuts

Portland State will face an estimated $4 to $6 million budget reduction for the 2006-07 fiscal year, with possibly millions more to follow pending approval of faculty and staff salary increases by the State Emergency Board in April.

“We’re stuck with having to do things and not having enough funding to do so,” said Mike Driscoll, vice provost of academic personnel and budget.

Dr. Ray Johnson, professor of accounting in the School of Business Administration and chair of the budget committee, broke it down more specifically.

“The university costs are growing faster than the revenues,” Johnson said, adding that if revenues do not keep up with costs, the budget will suffer.

Lindsey Desrochers, vice president of finance and administration, said that it is very important that the Emergency Board approve the $3 million salary increases that the new budget includes.

“If they choose not to release the funds, it will make a much larger hole,” Driscoll said, concerning the faculty and staff salaries.

Desrochers said that she cannot say how the school will deal with the deficit because they are still evaluating the situation. Johnson said that it is premature to determine what will be done.

Johnson said there is a whole succession of decisions that need to be made, such as figuring out how to expand the university’s resources and determine how well resources are being used.

“A very important step is asking can we grow institutional resources without increasing cost,” he said.

Driscoll said there are several possibilities for action. One is making non-resident tuition proportionally expensive for all credit levels. Currently, non-residents pay the same as residents if they take less than eight credits. The change would cause non-resident students to pay non-resident tuition regardless of how many credits they are taking.

Driscoll said attracting more non-resident students would also bring more revenues.

Johnson said the problem has been brewing for a while, with the university having a $5 million deficit last year, but the school has been sustaining deficit with surplus university funds.

“We can’t sustain the university that way on a permanent basis,” he said.

Desrochers said that the budget committee is looking toward dealing with the problem, but that the task can be difficult.

“We’re going through a complicated process of talking with deans, student government and departments,” she said. “It depends on how the costs shape up.”

The growing size of the school and increasing costs in areas such as facilities are big factors in the problem.

“PSU will continue to grow no matter what,” Driscoll said. “Growth raises problems.”

Driscoll said that the university would be in better shape if there were enough funding in the state.

“Unless people decide to start investing in public universities again, nothing will change,” he said, adding that state support for public universities have shown a declining trend over the last 10 years.

Johnson believes the problem to stem from it being expensive to provide good and necessary parts of the university, such as libraries and faculty.

These cuts hit Oregon State University as well. They expect to see between $10 and $12 million in cuts, about a five percent budget reduction overall.

Nancy Heiligman, associate vice president for Finance and Administration at OSU, said that they are looking to reduce athletic funding by $1.5 million and also reducing auxiliary funding to make them self-supportive.

“The Provost has asked staff to make cuts that are strategic in nature,” she said. “Every time you make a reduction it is really difficult.”