January 24, 2011 in Idaho

UI prez: Budget cuts ‘not sustainable’

By The Spokesman-Review
 
Betsy Russell photo

University of Idaho President Duane Nellis gives his budget pitch to lawmakers on Monday. He said for every $1 the state invests in the UI, it gets back $9.
(Full-size photo)

BOISE – University of Idaho President Duane Nellis warned state lawmakers Monday that budget cuts like those the university has absorbed the past two years are “not sustainable.”

The UI has been hit with state budget cuts of 22 percent over that time period, he said. Gov. Butch Otter‘s budget recommendation for next year is for another 1.3 percent cut in state funding to colleges and universities.

“I appreciate the governor’s recommendations,” Nellis said in his budget presentation to lawmakers. “It is a cut, but it is still something, I think, with a small fee increase, we probably can manage….” The problem, he said, is longer-term: The state is on the verge of “long-term negative impacts to the institution and its ability to serve the state.”

The university has shed more than 200 positions through budget cuts, Nellis said. It has eliminated programs, deferred building maintenance and imposed unpaid furloughs on university employees.

“Part of the problem is we’re losing some of our key faculty every year,” he said. “We’re trying to minimize that, but I do worry about our ability to continue to deliver the quality of educational experience that has been our brand.”

That hasn’t happened yet, he declared, citing the UI’s recent ranking at 153rd in the nation in the most recent U.S. News & World Report “Best Colleges,” and the Carnegie Foundation’s classification of UI as a “research university with high research activity.”

“Every year, we put nearly $1 billion into Idaho’s economy,” Nellis told the Joint Finance-Appropriations Committee. “That’s roughly 2 percent of the state’s economy. In other words, we return $9 for every $1 you invest in us.”

The past two years have brought the two largest freshman classes in the University of Idaho’s history, Nellis said. Research, too, is continuing to grow.

Nellis also highlighted STEM, or science, technology, engineering and mathematics education, which he said is “essential for gaining profitable new industries and jobs in Idaho.” Roughly 33 percent of all degrees UI awards are in those disciplines, he said; in comparison, other Idaho institutions average 12 percent, and the university’s Western peers average 25 percent.

The UI president said he doesn’t yet know how much tuition and fees will have to increase next year, but he expects the amount will be smaller than this year’s 9.5 percent increase.

Nellis could have to rely even more on the university’s dwindling reserves as the state prepares for what promises to be another lean year.

“I hope that you can find some one-time ways to help us through this budget year with some of that,” said Rep. Maxine Bell, R-Jerome, who co-chairs the Legislature’s joint budget committee. “Frankly, your money looks better to me than mine does at this point.”

Idaho’s public universities and colleges have about $168 million in unrestricted net assets, a figure lawmakers have been eyeing, though the schools say about $94 million of that is tied up in contract obligations and another $55.8 million is designated for critical projects that are part of their strategic missions.

Only $3.8 million of the University of Idaho’s unrestricted assets are “true reserves” and not already obligated in a contract or designated for a specific project, Nellis said. That’s about 1 percent of the UI’s operating budget, well below the state Board of Education’s goal of a reserve of 5 percent.

Sen. Dean Cameron, R-Rupert, the budget panel’s co-chair, said in the current budget crunch the state itself has been running with reserves of less than 1 percent.

The Associated Press contributed to this report.


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