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Memo recaps planning unit adjustments
OHIO positioned for 21st century, President McDavis says  

Apr 3, 2009  
From staff reports   

Ohio University has implemented a number of initiatives to position the institution to meet the needs of the 21st century and protect its core academic mission, President Roderick J. McDavis said Thursday.

In an e-mail to faculty and staff, McDavis wrote that the changes included administrative restructuring, efficiency improvements, the elimination of open positions and adjustments to the health plan -- actions designed to minimize layoffs while maintaining academic priorities.  At the same time, planning units developed blueprints to achieve fiscal year 2010 reduction targets totaling $15 million.

"Despite hope for continued support from the Governor and the General Assembly, Ohio University has, indeed, suffered the effects of this economic downturn," McDavis said. "The losses to our endowment income, interest income, and financial aid support, coupled with a multi-year tuition freeze and increases in operating expenses have forced us to take difficult action."

Reduction targets for planning units varied. Support units received the largest targets, ranging between 3.4 percent and 9.6 percent. On average, support units saw an average reduction of 5.1 percent.

Academic units, meanwhile, were given smaller targets to meet. Those reduction targets fell between 0 percent and 6.3 percent, with an average of 3.2 percent.

McDavis stressed that planning units had the opportunity to describe the impact of the budget cuts and request that high-priority items be exempted. In addition, McDavis, Executive Vice President and Provost Kathy Krendl and Senior Vice President of Finance and Administration Bill Decatur restored about $850,000 in personnel and operating expenses previously identified by planning units for reduction.

Still, the units' reduction plans did involve layoffs, McDavis said, noting that all job categories were affected.  Those losses include: administrators (36) AFSCME (33); classified non-bargaining unit (21); full-time, tenured and tenure-track faculty (0).

"Many of us, including myself, have had to say goodbye to valued, dedicated co-workers whose positions were eliminated as a result of our current economic situation," McDavis said. "Those who remain have had to take on more responsibilities and continue the work that must be done. This is a very difficult time, and it is not lost on anyone who cares deeply for the people who make Ohio University a great place."

Also Thursday, Chief Human Resource Officer Luis Lewin said 60 employees have signed up to participate in the university's early retirement incentive plan, which will remain open through Aug. 31, 2009.  Some 300 employees are eligible to participate in the plan.

It's difficult to say how many of the layoffs will be permanent because the ultimate number of employees who enroll in the ERIP could alter that count, officials said. Classified and AFSME employees also have "bumping," or displacement, rights based on seniority, officials said. In some employee categories, there also are recall rights if vacancies occur.

In the weeks ahead, university budget planners will be closely monitoring legislative action on the governor's budget, which they expect will be finalized in June. Based on the initial state budget released in February, the university's $15 million reduction scenario assumes state funding will increase 4.0 percent.

Other revenue assumptions built into Ohio University's fiscal 2010 budget include no increase in tuition, flat enrollment, and no investment income.  On the expense side, university planners had to account for higher costs in utilities, benefits and maintenance, Decatur said.

A number of efficiency initiatives already under way helped shrink the expected budget shortfall, however, including a new prescription drug consortium that the university will join in July.

Even with the need to trim the budget, Decatur said the university strove to ensure that strategic initiatives and the student experience were protected as top priorities.

The fiscal 2010 budget includes funds that will support the university's new four-year bachelor's of science degree in nursing program, which will begin enrolling students in the fall, and pay for new and existing student scholarships. Some of those scholarships had been funded through investment income ? but the fiscal 2010 budget has allocated general fund dollars to ensure commitments for current students are honored, Decatur said.

Those student priorities were maintained throughout other budget scenarios university planners have crafted.

But Decatur cautioned that the process to craft both a state and Ohio University budget remains fluid and subject to change.  A final university budget will be presented to the Board of Trustees to approve in June, he said.

"This isn't finalized and we're a long way from the end of this budget," Decatur said. "This is based on the governor's budget, which is very favorable to higher education. The state's budget hasn't even gone through the House yet."



Related Links
Budget Update Web site:  http://www.ohio.edu/budget/ 
Office of the President:  http://www.ohio.edu/president/  

Published: Apr 3, 2009 1:52 PM  

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