Southeastern implements $13 million budget reduction
Contact: Rene Abadie
Date: July 19, 2012
HAMMOND – Southeastern Louisiana University is initiating a plan of budget reductions and savings totaling approximately $13 million, university officials announced Thursday (July 19).
The cuts are due to a reduction in the university's state appropriation of $9.1 million and increases in retirement costs, risk management premiums and other mandated expenses and an anticipated decrease in tuition revenue due to an expected moderate decline in enrollment, said university President John L. Crain.
The university has increased admission standards multiple times in recent years, and standards will go up again this fall.
"We believe these higher standards, in conjunction with the significant increases in tuition over the last several years, are largely responsible for the projected enrollment decrease," he said.
"While the $13 million budget reduction for the new fiscal year is significant, the true magnitude is more apparent when the cumulative amount of reduction in state funds is considered," Crain said in a message to faculty and staff. "Since the beginning of the 2008-09 fiscal year, our state funds have been reduced by almost $40 million, essentially cutting our state funds in half."
The university's operating budget this year totals $107.8 million. Although state approved tuition increases allowed under the LA GRAD Act have increased self-generated revenue to $67 million of the school's budget, tuition increases have not kept pace with the decrease in state support.
The budget reduction plan being implemented includes eliminating 13 instructor positions and various part-time faculty and a layoff plan of 23 filled positions in both classified and unclassified staff, resulting in a cumulative savings of $1.9 million.
"I am very disappointed we must resort to additional layoffs and workload increases," he said. "I especially regret the negative impact layoffs have on the lives of our colleagues; unfortunately the cumulative magnitude of reductions in state support and the reality that it is unlikely state support will increase in the foreseeable future leave us no choice. I am firmly convinced the prudent course is to right-size our operational footprint to be more consistent with reduced resources."
The budget plan also includes the elimination of 80 positions through retirements, resignations and vacant positions that will save approximately $4.4 million. Other savings will be achieved through several approaches, including:
-- utilities-related savings and fees: $2.4 million;
-- recovery of indirect dollars from federal grants: $1.3 million;
-- fund swaps between operating and restricted funds for items such as certain instruction-related activities in academic departments, library acquisitions, and student-related software maintenance; and reductions in transfers between operating and restricted funds, including athletics; and a reduction in operating funds for student scholarships will be offset with funds from the non-profit Southeastern Foundation: $3 million.
Crain said that given the budget realities, the university will continue to work on strategies that will allow Southeastern to sustain support for its most productive and critical programs.
"As always, I will seek input and participation from on-campus and off-campus constituents about these issues of strategic importance where the future of our institution is concerned," he added.
"There is no doubt that this has been the most complicated and difficult budget reduction with which I have been involved in my 26-year career in higher education," Crain added. "Certainly a significant part of the difficulty is due to the magnitude of the current reduction, but more importantly it is the cumulative amount of multiple reductions we have experienced in the last few years that complicates the issue."
In his message, Crain praised the dedication of faculty and staff who managed dramatic budget reductions and continue to provide viable educational opportunities to students in the region.