By Katie Quaranta
The Budget Planning Council met Friday to begin planning for contingencies that could face the university yet this fiscal year and to determine how best to align those plans with university priorities.
Senior Vice President for Finance and Administration Bill Decatur emphasized that, because of the uncertain financial picture, the university community needs to think ahead and develop contingency scenarios in order to be strategic now rather than reactive later.
"There are a lot of unknowns at this point," said Director of Budget Planning and Analysis Rebecca Vazquez-Skillings. "We are continuing to monitor the impact of the economy, and these plans will put us in a better position to manage whatever happens."
For this fiscal year, the university will develop contingency plans to address possible budget reductions of up to $13 million. The strategy provides a cushion for investment losses of up to $8 million because of the international financial crisis and $5 million should the governor be forced to impose mid-year budget reductions that affect higher education.
A recent hiring freeze is one approach the university has implemented to build one-time funds that could help bridge possible funding shortages this year. In addition, Finance and Administration will work with the BPC to determine how to most effectively use the $1.5 million the university has in budget reserves. These groups also will make recommendations for how much of any projected shortfall would need to be absorbed by planning units.
In the past, the university has set across-the-board targets for all units when cuts were needed. However, Vazquez-Skillings stressed that the university needs to move toward a model that is more strategic and takes into account institutional priorities, particularly those associated with the Five Year Vision OHIO Implementation Plan.
"Any cuts we make need to be based on careful planning," she said. "The BPC recognizes that it is important to prioritize activities that are central to the mission of the university and protect them whenever possible."
Vazquez-Skillings expects to have potential one-time reduction targets for the current year to units sometime in November.
In the weeks ahead, BPC members also will begin discussions about the fiscal 2010 budget and craft several budgetary scenarios that allow for maximum flexibility. This is particularly important considering the ongoing fluctuations in the economy and the fact that final state funding formulas for higher education and decisions on tuition and fee caps may not be known until June or July, she said.