After cheerfully announcing the university’s pledge of $8 million to be distributed to faculty based on performance at her annual Fall Address, USF President Judy Genshaft took a more urgent tone when fielding questions from faculty about the university’s plans to cut $12 million from its recurring budget this year – $9 million of which will come from Academic Affairs and support units.
“We value you,” she said at the Fall Address, in which she highlighted the university’s accomplishments over the past year amid tougher financial times. “That’s why I am reinvesting funds and making available $8 million for performance or merit-based increases to base salaries.”
But as Chief Operating Officer John Long took questions from the Faculty Senate at their first meeting of the semester as to why the bulk of the spending reductions would hit Academic Affairs, Genshaft emphasized the need to start implementing the cuts and for departments to start providing college deans with areas to reduce spending in.
“Every part of this university has been taking cuts as a system,” she said. “It’s not just one or the other. …We try to protect the academic core of the institution first, but it does get to a point where we have no other choice. We are at a point now that we have to; we have to restore our reserves and our cash. Period. That’s where we’re at. … We’re now at a point where we have to make those decisions, finish it out and make those cuts.”
“I’d like to see the final numbers come to each of the deans that are in Academic Affairs by next week. I mean, we’ve been waiting long enough. It’s time for the deans to receive their numbers. We’ve had the $9 million out for a couple of weeks – at least three. It’s time for the deans to get their numbers so they can get to work and conduct the business they need to conduct,” she said. “I mean, nobody’s getting rich on this. Everybody is putting forth their efforts and trying on this. We’re all working very hard.”
Long said the financial situation USF now faces was caused by the “perfect storm.”
After spending in strategic investments during the 2010-11 year, losing $45 million when the State University System took a $300 million hit and losing $30 million with the separation of the Polytechnic branch campus, Long said the money restored in this year’s allocations did not help.
“That didn’t really do anything for us,” he said. “We had already spent it. The restoration was just paying back the bank. … We drained $100 million in a year and a half.”
In order to protect the university’s AA2 Moody’s bond rating, a rating that allows the university to maintain sound financial footing – a rating that the entire higher education sector has taken a hit to in recent years – Long said the university would need to take proactive steps and has come up with a three-pronged plan: to reduce expenses, increase revenues and reinvest in the university.
“What we’re dealing with is no different than at home with your personal credit score,” he said. “I know a lot of people say, ‘I don’t care about bond ratings. I’m just worried about my research and my classroom.’ But I just put it in simple terms like at home. If you’ve got a bad score, you can’t get a home or a car or a mortgage. You’ll probably have some issues you’ll have to deal with. You want to be proactive so down the road we don’t have issues to deal with.”
Long said the university would explore efficiencies and ways to reduce spending.
According to a draft budget and expenditure analysis provided by the Office of the Provost at the Faculty Senate meeting, in total, all colleges reduced expenses by about 3.3 percent during the past year, ranging from the College of Engineering, which reduced expenses by 14.3 percent, to the Patel College of Sustainability, which increased spending by 67.6 percent. Simultaneously, cash reserves to the colleges decreased by a total of 33.6 percent.
In total, the 3.3 percent cut by colleges during the past year equaled more than $6.4 million. The additional $9 million that needs to be cut will come from these colleges combined with academic support units, such as the Library and Office of Graduate Studies.
Genshaft said the university would continue to look for new sources of revenue as the university grows increasingly “boxed in by the Legislature” that has increased pressures on universities to become more efficient but does not allow them to request more tuition dollars from students. Genshaft said the university would need more “full-paying students” and would try to recruit them.
Additionally, the university would reinvest in strategic areas, Genshaft said, such as the $8 million that has been pledged to merit-based faculty raises, which comes in addition to the one-time bonus the state is providing to all employees. Further details as to how the money will be distributed will be announced later, Genshaft said.
Faculty Senate President Gregory Teague said while nothing has been confirmed yet, he speculates that the majority of faculty will not see the bonuses in the pot and the money will go toward high-performing faculty who bring in research dollars or publications.
“People who are attracting visibility might be attracted away from the university, so these (funds) are probably to help keep them here because our salaries, here in Florida, are at the bottom of the file,” he said.