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University officials ready plan for state cuts
KANSAS CITY, Mo. -- Staff would be encouraged to retire early and students would pay an educational surcharge as part of a series of proposed cost-savings measures announced Thursday by University of Missouri system officials.
In a letter to its curators, university officials described how they would attempt to trim an additional $41.2 million from operating revenues with just six weeks left in the fiscal year. The effort includes borrowing against revenues. The move is in response to Gov. Bob Holden's decision May 10 to withhold state money from higher education in order to balance the state budget.
"It pains me greatly to take these actions, but I don't think we have a choice," said Manuel T. Pacheco, president of the University of Missouri's four-campus system.
Curators are to vote on the proposals at a May 31 special meeting.
The university system already had absorbed about $43 million in cuts because of the faltering state budget.
Pacheco said he hoped the latest plan would prevent the university from furloughing employees and cutting salaries.
Refining the options
Following a meeting Wednesday morning with campus chancellors, Pacheco said system officials are in the process of refining a series of options to take before the Board of Curators at the special meeting.
Those options include generating $12 million in savings by cutting about 400 positions through an early retirement program and layoffs.
Another $10 million would be generated through a student surcharge that would be assessed based on the number of credit hours a student was taking or as a percentage of tuition.
The surcharge would be removed when the budget shortfall has been remedied, Pacheco said.
In March, curators voted to raise tuition and other fees 8.4 percent.
The system also planned to generate about $12 million through a temporary spend-down of reserves. The money would be paid back through early retirement and other actions the system is taking, Pacheco said.
"The goal is to pay back within the next year," he said. "This is just to help with cash flow."
Besides the cuts that would require board approval, the letter said each of the university campuses needed to come up with a plan for curtailing or eliminating such expenses as out-of-state travel and office supply purchases. The cuts were to total $2.3 million systemwide.
The system is asking that all requisitions that have not been turned into purchase orders be canceled unless they are absolutely necessary.
Also, the letter said, the university's purchasing card should be used only to buy items that are needed for this fiscal year.
The letter urged the university campuses to consider which of the cost saving measures they should carry over into the new fiscal year, which begins in July.
The remaining cuts will come from the University of Missouri-Columbia hospital and clinics and several other programs the Legislature has placed under the control of higher education, including a kidney and spinal research program.
Pacheco said last Friday that the university's hospital system will be forced to discontinue its heart transplant program and divest itself of several clinics around the state.
Martha Gilliland, chancellor of the University of Missouri-Kansas City, said she was disappointed that the cuts from higher education had been so deep. She also said that she continued to lobby the governor's office in the hope that a new executive order would be issued.
"I haven't given up on this," Gilliland said. "I have every hope that there will be a more equitable approach taken by the state's officials."