Sent via e-mail by President Roderick J. McDavis Dec. 12, 2008

Dear Ohio University Faculty and Staff:

Following Governor Ted Strickland's early December public statements on the budget, he and Chancellor Eric Fingerhut met with public university and college presidents to discuss the impact of the current national economic situation on the State of Ohio and the state's public higher education system.

Governor Strickland has called the projected deficit of more than $7 billion in the 2010-11 operating budget a shortfall of "historic proportions" for our state. He appealed to President-Elect Barack Obama for federal assistance to states facing budget shortfalls. It is unclear at this time if such a relief will be granted. And if it is, it may only be given to assist the state with its projected FY2009 budget deficit, which is estimated at $640 million.

Given the current global economic situation and its negative effect on investment income along with the anticipated reductions in state support, we are taking steps to address fiscal challenges while protecting core institutional missions. At Ohio University, university-wide efforts are under way to limit expenditures and protect resources needed to support our academic mission of undergraduate education, select graduate programs, and distinctive areas of research, as well as the services central to achieving our mission.

For FY2009, we have set a one-time savings target of $13.9 million to close the investment shortfall and prepare for a potential five percent state reduction. To help achieve this one-time savings target we implemented a university-wide hiring freeze in September. In addition, many academic and academic support units across the university have put other measures in place, including halting nonessential travel and nonessential equipment purchases, slowing operating budget expenditures, and conserving resources by practicing energy efficiency measures.

To prepare for FY2010 and beyond, we are undertaking long-term planning efforts. We are using three different approaches to a) examine cost savings and revenue projections, b) create innovative approaches to university operations, and c) address anticipated state budget reductions. Below are the groups charged with these efforts:

• Budget Planning Council (BPC): The BPC is looking at major expenditure and revenue categories to develop recommendations for the coming biennium.
  
  
• Executive Staff and Academic Deans Working Groups: The Executive Staff and Academic Deans have developed cross-organizational working groups to examine various functions of our university including intercollegiate athletics, administrative restructuring, business, finance and human resources processes, academic restructuring, and revenue generation, among others. The purpose of these working groups is to generate ideas to find efficiencies and innovations in how we structure university operations, using our Five Year Vision Ohio Implementation Plan as a guide.
  
  
• Planning Units: Each planning unit has been asked to consider and plan for the impact of three different potential budget scenarios. The scenarios are based on the assumptions of $20 million, $30 million, and $40 million budget reductions.

Our timeline calls for the groups' recommendations to come to me by the end of January 2009, which will coincide with the release of Governor Strickland's state budget. We will compile these recommendations and share them with the campus community. I will then evaluate all the recommendations along with feedback from the campus community before making decisions on the most effective course of action for the University.

If you have ideas for ways we can further strengthen our operations, please share those thoughts with representatives of BPC, planning unit managers, or your academic dean or division leader.

I understand that people are worried and anxious. And some may even feel numb to the fact that once again we face budget cuts from the state. Please know that while the cuts may be deeper than we have experienced in the past, Governor Strickland and Chancellor Fingerhut believe higher education is part of the solution to the state's problems. We are grateful to our state's leaders for affirmation of that belief by holding the state support per full-time student harmless from the two most recent state budget reductions.

We have invested a great deal of time and effort as a university community to develop and implement a strategic academic plan, Vision Ohio. We will continue to use this plan as our guide when it comes time to make difficult decisions. I assure you that we will make it through these tough fiscal times and emerge a stronger university community. I thank you for the commitment, talent, and innovative spirit that are the strength of Ohio University's past and the assurance of its future as a leader in higher learning.

I will continue to share updates about our planning and preparation efforts as we move forward.

Cordially,

Roderick J. McDavis
President

• State budget challenges deepen (from Outlook)