$1.16 million increase in Western’s budget proposed

Institutional News

Western will receive an additional $1.16 million in state appropriations if the recommendation by the House Budget Committee remains intact.

The recommendation must be approved by the House, the Senate and the Governor to guarantee the 5.2 percent budget increase for fiscal year 2009. 

If signed, the increase will be the second of three appropriations increases; the first 5.5 percent increase was part of the budget for fiscal year 2008, which runs from July 1, 2007-June 30, 2008.

Western will receive nearly $23.52 million in state appropriations, slightly less than originally anticipated.

Dr. James Scanlon, Western’s president, is pleased with the increase compared to other universities.

“We’re getting one percent above what the average increase in funding is for the public four year universities; 4.2 is average, we’re getting 5.2,” Scanlon said.

Even with the increase last year, Missouri ranks 47th in the nation in appropriations per capita for higher education, followed by Colorado, Vermont and New Hampshire.

“The state of Missouri cannot build a strong economy or a strong society going forward funding higher education at the level of 47th in the nation,” Scanlon said. “When you are funded at the level of 47th in the nation, it’s hard to be anything else but very lean. So, when the cuts come, you’re not cutting fat, you’re in the bone.”

Budget cuts are very likely in the future for Western. “It does appear that similar clouds are on the horizon that ultimately dominated the horizon in 2001 and succeeding years,” Scanlon said. In those years, there was a 10 percent budget cut, and then a two percent increase and then it did not change for three years.

The following year (FY2008), the increase was 5.2 percent. Richard Gilmore, associate vice president for financial planning and administration at Western, recalls cutting into the bone. “We took a very large hit in fiscal year 2002 when  they withheld money we were suppose to get then the very next year we took a 10 percent cut,” Gilmore said. “Missouri took one of the biggest hits in the nation.”

Total appropriations in FY 2002 were $21.9 million, and then with the 10 percent cut appropriations dropped by more than $2 million. With the proposed 5.2 percent increase for next year, Western would barely move beyond where it was in FY 2002.

Western survived the cuts by using reserve funds, wisely. “Dr. Janet Murphy left us with good reserves that helped us enormously manage the cuts we received,” Scanlon said.

The reserve fund will be necessary should the budget fall under the axe again. “We maintain a strong reserve so that, it is not an if, it is a when, when the next downturn comes, the university is in a position, we’ll be able to manage the financial situation,” Scanlon said.

In anticipation of potential cuts, Western has built its reserves up to approximately $7.8 million. Provost Joseph Bragin feels reserves are necessary to prepare for another set back. “We are going to have to plan for a bad situation,” Bragin said.
If state appropriations were cut 10 percent as they were in 2002, the loss to Western would equal $2.35 million, a lot of bone. To alleviate the cut, Western could increase tuition. However, because of Senate Bill 389, tuition could not be increased by more than the current Consumer Price Index (CPI), which most of us know as inflation. The current CPI is 4.1 percent; each one percent increase in tuition equals about $120,000. That adds up to about $500,000 to make up for the $2.35 million cut.

State appropriations and tuition comprise 97 percent of Western’s total operating budget of roughly $46 million.

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