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Administration

Clarification on budget reduction numbers

February 7, 2009

There has been some confusion about conflicting budget reduction numbers, based on information reported in local news stories this week. At the risk of confusing the issue even further, I wanted to attempt to clarify the reasons for the disparity.

Clarification of disparity 

There has been some confusion about conflicting budget reduction numbers, based on information reported in local news stories this week. At the risk of confusing the issue even further, I wanted to attempt to clarify the reasons for the disparity.

The CSU System’s General Fund reduction for FY09 is $7.5 million. Our campus share of this is $6.5 million, with the remainder derived from CSU-Pueblo and the CSU-System.

The budget reduction levels for the System that are now being publicly discussed by the state are based on the budget recommended by CCHE (Colorado Commission on Higher Education) and submitted by the Governor on Nov. 1 - a budget that has not yet been approved by the General Assembly. If the Governor’s numbers hold true, the CSU System will be facing $12.5 million in base cuts for FY10, which includes the $7.5 million identified in the FY09 budget and an additional $5 million.

Advisable to err on side of conservatism 

As an institution, however, there is a problem in using this formula for our planning purposes. As we’ve all seen in this economy, it’s generally advisable to err on the side of conservatism in planning for actual budget growth. For that reason, we've been planning for deeper cuts for our campus of $12.2 million, on top of our $6.5 million share of the System’s FY09 reduction. My sincere hope is that this level of reduction will be unnecessary and we’ll find ourselves facing a much more positive outlook than anticipated. But with this level of conservative planning, we will be well-prepared if the state revenue outlook further declines. Other Colorado universities are also engaged in additional budget-planning scenarios - out of this same desire to be prepared for the possibility of deeper-than- expected cuts.

We won’t really have a clear sense of our actual budget picture for FY10 until well after the 3rd quarter revenue forecast on March 20, and even at that point, there will be considerable negotiations and debates before final numbers are reached. If the CCHE numbers turn out to be correct and the CSU System’s FY10 cut is only $5 million, I think we could safely say there would not be a need for significant layoffs - which is a situation that would please us all. But until we know more, I believe we’re better off in planning for the worst and hoping for the best.

Well-positioned to weather the storm
 

Having spent the early portion of this week in Washington, D.C. discussing the economic recovery package with many of Colorado’s elected representatives, I think it safe to say that the challenges we are facing here in Colorado are a mirror of those being faced by our colleagues around the country. While misery may not love company in this circumstance, I think Colorado State is well-positioned to weather the storm, in large part because of all of your engagement in our University and your hard work on her behalf.

I hope you have a great weekend; D.C. also reminded me to encourage you to enjoy our weather!


Dr. Anthony A. Frank
Interim President