UNIVERSITY WILL RETAIN NITZSCHKE ANOTHER YEAR

Southeast Missouri State University probably can't afford pay raises for its employees right now, but it will keep fund-raising chancellor Dale Nitzschke on the payroll for another year, the Board of Regents decided Thursday.

With the school facing further cuts in state funding, the board held off on granting pay raises averaging 2 percent for university employees for the fiscal 2002 year that begins Sunday.

The action came as the board approved a $108 million budget. Depending on state funding, $1 million or more that could be used for pay increases and other expenses is almost certain to be cut.

A short time later, the regents voted behind closed doors to retain Nitzschke, the school's former president, as a consultant. Nitzschke will be paid $120,000 a year plus up to $45,000 for expenses under a one-year contract that could be renewed annually.

School officials said Nitzschke, who was on a fund-raising trip to New York City Thursday, will continue to lobby for federal funds and help secure private gifts for the university. University President Dr. Ken Dobbins said Nitzschke secured over $7.5 million in federal money for the school in his two years as chancellor, including $2.6 million to pay for planning for a River Campus museum in Cape Girardeau.

Don Dickerson, president of the Board of Regents, said the school can't afford not to have Nitzschke as a fund raiser, particularly in a year when state funding is tight.

"I'd like to hire six more," he said.

Nitzschke's two-year term as chancellor ends Saturday. As chancellor, he was making a salary of $95,000 a year. But with an annuity and other employee benefits, his total compensation was $118,000 a year. In addition, he had a $20,000 budget for travel and operating expenses.

In his new capacity, he will no longer be a university employee even though he will continue to do the same work, school officials said. Nitzschke will continue to live in the Cincinnati suburb of Milford, Ohio, and work out of his home.

Waiting for action

Meanwhile, university employee pay raises hinge on how much state money Gov. Bob Holden will withhold from the school. Keeping pay for the university's 1,200 employees at the existing level would save $1 million, school officials said.

Southeast had hoped to receive $48.8 million in state funding for the coming fiscal year after the usual 3 percent withholding. Missouri's governors traditionally have withheld 3 percent of the appropriated funds from state agencies and public colleges to guard against lower-than-expected revenue or unforeseen expenses.

But this year, the withholding is expected to be even higher. Dobbins said it could be mid-July before the governor announces how much will be withheld from state agencies and colleges.

"The higher-education community will not be unscathed this time," Dobbins told the board.

Southeast may impose a hiring freeze and postpone equipment purchases to make ends meet, he said.

Students could be faced with a midyear fee hike. But Dobbins said fees would be hiked only as a last resort.

Regent Kim Mothershead said the university should look to cut expenses before trying to balance the university's budget on the backs of students through higher fees.

James Riggle, a senior at Southeast, said raising fees midyear would hurt students, particularly those who have federal student loans. The amount of a student loan for a school year is set at the start of the fall semester. Students can't go back to the federal government for more money should fees go up midyear.

"They will have to find money elsewhere," he said.

Riggle said he already is using his savings to pay rent in Cape Girardeau.

Dickerson said projections of a $300 million shortfall in the state budget might be exaggerated. He urged the board and the university administration to refrain from making drastic cuts in spending plans.

"I think we need to strike some middle ground and not overreact," he said.

Dickerson said hiking student fees might be better than eliminating a lot of academic programs at a time when the school is experiencing record enrollment.

The state's budget woes could make it harder for the university to secure money for capital improvements next year, school officials said.

Even so, the regents voted to request state funding in fiscal 2003 for a number of proposed projects, including $22 million for interior and exterior renovations to Academic Hall and $21.7 million for improvements to the school's science buildings.

School officials said it's important to get the funding requests on the table.

Budget analysis

A tentative $108 million budget was approved by the regents Thursday. It includes $84.6 million for general operations and $23.3 million for auxiliary services.

The operating budget includes state funding -- currently shown at nearly $49 million -- and more than $25.5 million in tuition and related fees. The revenue stream also includes $8 million from activities such as sports and music camps and university athletic events and $2 million from various other sources ranging from library fines to transcript fees and facilities rental to investment income.

Tuition alone would provide 32.7 percent of the university's net estimated operating expenses, budgeted at $76.5 million. That figure doesn't include revenue from athletic events and various camps.

The auxiliary services are funded with user fees. They include student housing, the Show Me Center, Student Recreation Center and textbook services, as well as services ranging from telecommunications to parking.