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UMW searching for savings to narrow budget gap

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Officials at the University of Mary Washington are running numbers and searching budget line items for savings again this week after its state funding came in $1.5 million less than expected.

The $112 million 2014–15 university spending plan has already gone into effect, and Chief Financial Officer Rick Pearce says reductions have to be made to pay for new programs and mandated benefit increases.

UMW’s board of visitors unanimously approved a preliminary budget in May, as well as a tuition increase.

At the time, staff expected more than the about $21 million allocated from the state during the last budget cycle. However, state funding remained level.

The approved budget relied on a few assumptions about how the General Assembly would vote.

Pearce said that based on historical norms and the budgets presented by the Senate and the House, he planned for a 1 percent salary increase, benefit increases, an additional $1 million in general funds and an additional $125,000 to support the new bachelor’s degree in nursing program.

Those won’t be covered by state funds now, but the benefit increases, program costs and operation costs for a soon-to-be-opened building still need to be funded.

Also driving the budget this year is last year’s enrollment shortfall. The $1.3 million in tuition dollars not brought from students was made up with one-time funds during the last budget cycle. But now the school has to make up that loss with general operating funds.

Pearce said that the budget is balanced except for the shortfall in state funds, and he expects to find the money elsewhere.

He and his staff are searching for savings in department operations and considering case-by-case hiring freezes.

Pearce stressed that no recommendations from the recently released Strategic Resource Reallocation report, a university-wide study at which programs should be invested in and which could be cut, will be used in immediate budget decisions.

He also ruled out layoffs and a complete hiring freeze.

The last time UMW faced a steep drop-off in budget expectations was the 2009–10 fiscal year, when the state cut higher education funds during the recession.

The General Assembly adopted a budget last month that includes $842.5 million in spending cuts to correct a projected $1.55 billion revenue shortfall.

Among those cuts were the pay raises for higher education workers and other state employees that had been included in the proposed Senate and House budgets if funds were available to offer them.

The additional funds for UMW, and other higher education institutions, were also cut.

In a letter to the university community, president Rick Hurley said, “I am extremely disappointed that this situation has suddenly been thrust upon us (as well as all of public higher education in Virginia). I am particularly troubled that anticipated state funds that would have supported a modest salary increase for faculty and staff are not forthcoming. Nevertheless, I thank you so much for your patience and loyalty to UMW and for working with us as we move through yet another difficult time.”

Lindley Estes: 540/735-1976

lestes@freelancestar.com

 

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