OU prepares for steep cuts


Gov. Rick Snyder’s proposed budget cut could reduce Oakland University’s state appropriations by almost a quarter.

It still needs to pass through the state legislature, but if approved, Snyder’s budget would severely strain the budgets of Michigan’s 15 public universities.

Central Michigan University is projected to face the highest possible cut — 23.3 percent — while Eastern Michigan University should see the lowest, a 19.3 percent reduction. OU is expected to receive a cut of up to 22.6 percent, the second highest.

Each university, however, has an opportunity to see only a 15 percent reduction.

Russi explained that Snyder recommended taking the five-year average of the tuition increase for all 15 public universities and staying under that number, which is 7.1 percent or less. OU’s projected cut ranges from $11.5-7.5 million, depending on whether they earn the tuition incentive grant.

Russi said it’s too soon to tell what the university will have to do to make up for the loss in state revenue, and the future is even less certain.

“(Snyder) proposed a two-year budget,” Russi said. “The second year is really critical. What they’re proposing is that it would be formula-funded. This would be the first time in the history of education — but the formula is not defined. So 2013 is still up in the air and will really represent a clean slate, so the money that we were to get this year … is not guaranteed for ’13, so we’re trying to figure out what all that means and at this point we don’t know.”

OU’s current state appropriation is $50 million. Its general fund is $180 million, according to Tom LeMarbe, director of budget and financial planning. LeMarbe’s department works toward planning and developing the university’s operating budget and must account for changes like the upcoming fiscal budget.

“I haven’t had a chance to meet with Dr. Russi yet, (but) my guess is we’ll be looking at everything as we try to balance the ’12 budget, including reserves,” LeMarbe said.

In a meeting on Feb. 18, Russi and others confirmed OU’s four priorities: Support strategic visions, protect and enhance the academic mission, provide excellent student services and minimize net tuition cost.

“These are extremely important because these are guideposts to the reductions that will occur on this campus,” Russi said. “Without these … you just sort of randomly go through with proposed cuts and just pick them and so on. You can’t do that. You really need to establish some solid foundations for why you’re cutting and what you’re going to protect. This is what we’re going to protect.”

With 86 percent of OU’s budget going toward “fixed costs” — salaries, utilities and insurance, to name a few — Russi said the university doesn’t have a lot of room to move around.

“In other words, we don’t have a lot of flexibility. When you have fixed costs, those are things that you have to make major changes to deal with them,” Russi said.

At the Feb. 17 University Senate meeting, Provost and Vice President of Academic Affairs Virinder Moudgil said the university needs to “start planning now.”

“I was at a national provost’s meeting last week, and I’ll tell you, almost all were scared,” Moudgil said. “There were Michigan provosts there who said they did not know how they were going to do their job with the budget cuts coming their way.”

Russi is asking for campus-wide feedback from faculty, staff and anybody that has an idea on how to fix the budget by the end of the day on March 7.

“We’ve got to move our agenda along, so we have a sense of urgency and we need this feedback,” Russi said. “We need it as quickly as we can get it, so I’m excited about the opportunity to listen and hear, and (the vice presidents and deans) will look at every idea.”

— Kay Nguyen contributed to this report