Provost’s Update on the Budget
The dust has now settled regarding UCF’s 2007-08 state budget allocation. As I explained in the last Provost’s Update, the budgets for the university’s colleges and administrative units were reduced by approximately $12 million in response to a mandate to reduce all state agency budgets by 4 percent. Given growing concerns that further budget reductions were ahead, a decision was made to escrow an additional 2 percent ($6 million) of our 2007-08 state allocation, awaiting the outcome of a special legislative session. The special legislative session has ended, and this fiscal year’s budgetary outcomes are known, including:
- state university recurring budget allocations, including UCF’s allocation, will be reduced by 3.6 percent, not 4 percent as indicated earlier; UCF’s base budget reduction is $9,763,482
- a total of $15.4 million in nonrecurring state funds is being added to the budgets of State University System universities in an attempt to soften the blow of the recurring reductions; UCF will receive approximately $1.7 million in nonrecurring funds
- SUS universities will share in $9.5 million of nonrecurring funds to offset the loss of the 5 percent tuition increase originally proposed to begin Fall 2007; UCF will receive approximately $1.6 million in nonrecurring funds
- a 5 percent tuition increase will take effect Spring 2008, bringing UCF approximately $1.4 million in new tuition revenues; 30 percent of this new tuition revenue will be designated for need-based financial aid
- nonrecurring performance funding, originally budgeted at $8 million statewide, will now be funded at $4 million; we anticipate that UCF will receive approximately $900,000
- beginning Fall 2009, each university Board of Trustees is authorized to implement a technology fee of up to 5 percent of the tuition per credit hourWhile the actions described above will assist universities in dealing with declines in state revenues in the current fiscal year, significant revenue deficits are anticipated to continue at least through the next fiscal year. As a result, all state agencies, including universities, are being cautioned to expect reductions in their 2008-09 state allocations that rival or exceed the reductions experienced this fiscal year. Thus, all withheld funds, including the 2 percent reduction being held in escrow, and a portion of the new tuition revenues and nonrecurring funds described above will be used to address the anticipated reduction in our 2008-09 state budget allocation. Furthermore, should 2007-08 carryforward funds exceed the 5 percent reserve limit, the excess carryforward funds will be applied, on a unit-by-unit basis, to any reductions in the 2008-09 state budget allocation. Through these actions we hope to lessen the impact of forthcoming budget reductions using centrally accumulated recurring and nonrecurring funds.
As before, the educational needs of our students must come first. To that end, we will use a portion of the nonrecurring funds to support additional course offerings during the upcoming spring and summer sessions. Nonrecurring funds cannot support long-term hiring commitments, but they can support full- or part-time instruction during the spring and summer and instruction by full-time faculty during the summer. To facilitate planning and hiring, decisions regarding the allocation of these nonrecurring funds will be made in the near future.
In closing, it is clear that many of you are reorganizing units and redistributing workloads for better efficiency, eliminating E&G funded travel, and contributing to other efforts to reduce operating expenses. Faculty members are teaching larger sections to ensure that our students are provided the courses they need to progress toward graduation in a timely manner. I would like to thank each of you for the extra efforts and sacrifices you have made in response to our budget cuts.