SOUTHEAST BUDGET SLASHED; BUSINESS BUILDING PUT ON HOLD

Southeast Missouri State University officials said they must look for ways to slash $936,000 from the university's operating budget following major budget cuts enacted by Gov. John Ashcroft in approving the 1992 state budget Thursday.

"I consider this very serious," said Kala Stroup, university president. "I would say that it is going to be very difficult for us to operate at the same level of service that we have been operating at."

Art Wallhausen, assistant to the president at Southeast, said: "It is a drastic, drastic cut that will seriously impact what we do next year.

"Instead of going forward, we are definitely going backward," he said.

University officials also voiced disappointment over the governor's veto of $420,600 in capital improvement projects for Southeast. Cut from the budget was $240,000 for continued planning work for a new business school, and $180,600 for construction of an elevator for the Grauel Building.

Left in the budget is $85,912 for maintenance and repairs at Southeast.

Wallhausen said the university is faced with having to operate on a net state appropriation of $29.84 million, which is the lowest net appropriation for Southeast since fiscal year 1989, when it received $28.8 million.

University officials had developed a budget, which anticipated state funding of $30.7 million for general operations, the same as the current fiscal year ending June 30.

That figure was based on the assumption that Ashcroft would withhold 3 percent of a $31.7 million base appropriation.

Instead, Wallhausen said, the governor vetoed 1 percent of Southeast's operating appropriation or $317,281 and withheld another 5 percent or nearly $1.6 million.

"That's almost a $1 million cut that we had not planned on," he said.

The 6 percent withholding and veto of funds marks the largest budget cuts in the institution's history, said Stroup. The university experienced cuts totaling nearly $1.8 million during the current fiscal year.

Wallhausen said the budget cuts will hurt. "We will have to look across the board at every expenditure, including personnel. We certainly will be looking at hiring freezes. We will have to look at deferment of equipment purchases.

"There is no simple solution," he added. "It will just have to be a line by line examination of the budget to see where the hurt will be the least."

But both Stroup and Wallhausen said the governor had to cut the state budget because of bleak economic conditions and projections that state revenue would not be sufficient to pay for state expenditures contained in the budget bill approved by the General Assembly.

"Other states have similar problems. Missouri is not alone," said Wallhausen. "But we are dealing from a position of weakness because we have been in this situation for several years."

Ashcroft cut or withheld a total of $216.3 million from the new $8.9 billion state budget. The new fiscal year begins Monday.

Tony Moulton, state budget director, said Southeast "was by no means singled out" with Thursday's budget cuts.

Moulton said the governor "actually vetoed a substantial amount of money he had recommended in his original budget in January. That's very unusual. It's an indication of the gravity of the situation."

Through his vetoes, the governor cut 1 percent of the operating budgets of all higher education institutions, said Moulton.

Hardest hit by the vetoes and withholdings were the state agencies and state programs, he said. "The smallest reductions were in education. It's definitely preferential treatment toward education," said Moulton.

Most state agencies faced withholdings of 12 percent, while universities and colleges received 5 percent withholdings, with a 3 percent withholding for state aid to local schools. State agency vetoes were also much higher than those concerning education, he said.

Moulton said there is a possibility that some of the withholdings could be released next year - but only if the state's financial picture improves quickly.

University officials said the institution had already been forced to slash expenses as a result of budget cuts and withholdings over the current fiscal year.

"We did not give any salary increases (for the coming fiscal year) and we have already increased tuition, and we have already made significant cuts in operations and equipment across the campus," said Stroup.

Wallhausen said that even before Thursday's action by the governor, university officials had sliced $600,000 from operating budgets of the university's various divisions in order to come up with a balanced budget.

Now, another $936,000 in cuts will have to be made in university operations, he said.

University officials, Wallhausen said, must now work out "a drastically revised budget." The new budget will be presented to the university's Board of Regents later this summer.

"This (the cuts) put a tremendous strain on the higher education system.

"I think once again it should tell the people of Missouri how essential it is that Proposition B is adopted this coming November," he said. Proposition B calls for a $385 million tax hike for education at all levels, from elementary school through college.

Moulton said the veto of Southeast's capital projects had nothing to do with the merit of the projects.

"It's a very basic affordability issue," he said. "The state simply had lack of revenues to fund these and many, many other proposals. It's unfortunate."

Wallhausen said university officials were disappointed over elimination of funding in the 1992 fiscal year budget for continued planning of the business school and construction of an elevator for the Grauel Building.

A St. Louis architectural firm was hired this spring to design a new College of Business Administration building. Plans call for the $14.5 million, 100,000-square-foot facility to be built at the corner of Henderson and New Madrid streets on the university campus.

But Wallhausen said, "It's clear that without the state support, we can't do much more planning for that building."

He said the university has been seeking funding to install elevators in the older campus buildings to meet federally mandated requirements for making the campus accessible to the handicapped.