Welcome to the Senate Republican Press Search.

View Article Details

Print

SIUE is loaning money to SIUC to help keep it afloat

Belleville News Democrat

Friday, March 31, 2017  |  Article  |  By Elizabeth Donald

Budget--State (8) , Education--Higher (37) , Governor (44)
The state budget impasse has now left Southern Illinois University with a quandary: One campus is weathering the storm whole, while the other is sinking.

The Edwardsville campus is facing another $4 million in cuts on top of the $12 million, or 9 percent, that were already cut in anticipation of a state budget that never came. While those cuts cause concern, Chancellor Randy Pembrook assured all SIUE employees there will be no layoffs or furloughs.

The Carbondale campus is in much worse condition. The campus needs to cut $30 million and is projected to be in deficit spending in a month. SIUC has “blown through” $80 million in its reserves and the reserves of the Springfield medical school, according to SIU President Randy Dunn, and now faces tapping into restricted funds from grants and bonds, a legally questionable choice, Dunn said.

Dunn’s proposal went out to the university community Wednesday: SIUE has $70 million in unrestricted reserves, and it can loan that money to SIUC on a short-term basis.

It is an internal, no-interest loan that would be repaid over several years, Dunn said. If the state approved more stopgap money, as it did last year, it might be much less and could be paid back in a year.

But as Illinois Gov. Bruce Rauner has publicly stated he will not approve more stopgap money without reforms, Dunn said they are planning for the worst-case scenari no budget or stopgap money until after the November 2018 election. Dunn said the system can survive without a budget that long, but it cannot survive without stopgap funding. By then all the universities would be into their restricted funds and the accompanying legal problems, he said.

So far, SIUE has not had to dip into its unrestricted reserve funds, due to significant budget cuts, increasing tuition rates, and a fast-growing enrollment, Dunn said.

By comparison, SIUC has not enacted the same level of cuts, due largely to a “revolving door” of leadership as the campus has gone through multiple chancellors, Dunn said. Meanwhile, SIUC is losing students, while SIUE is gaining.

The proposal did not go over well with many Edwardsville faculty and staff members, who filled an auditorium on campus Thursday afternoon to ask Dunn and Pembrook questions.

“I find this incredibly demoralizing,” said Phil Brown, director of institutional research and studies. “After all these years of cutting and being efficient, doing more and more with less and less, it’s hard to face another round of cuts when the impression is that Carbondale hasn’t done anything.”

Brown’s comment was greeted with applause.

Dunn acknowledged the sentiments. “It isn’t fair,” he said.

Indeed, Dunn said, the Carbondale campus has to do a complete structural reorganization. He said part of the problem is that as Carbondale’s student population has dropped, it has not downsized its programs and course offerings along with it. Carbondale is a research-oriented university that includes doctoral programs and offers about 200 degrees and programs. SIUE is a masters-level university and offers about 120 programs, but it is growing and Carbondale is not.

“You would hope to have seen some right-sizing in a slow, methodical way,” Dunn said. “Frankly, it didn’t happen. They have to do that now ... It’s going to be very painful, a massive reorganization of that campus that will throw things for a loop.”

However, that doesn’t resolve the immediate problem. Carbondale will need the SIUE loan even after the $30 million budget cut, Dunn said. Even if the state suddenly approved a budget at 2015 levels of spending, Carbondale would still need to reorganize, but perhaps not as severely, Dunn said.

One speaker questioned whether Carbondale could cut its budget enough to meet the need.

“Yes, they can make those cuts,” Dunn said. “If I was put in a room and told to do it, it can be done. The question is whether that campus community, the larger community, our board, will support what it will take to do it. I can identify $30 million that that campus could free up and make it quite viable.”

Several speakers said the morale is low in Edwardsville, as faculty and non-represented employees have gone without raises for three years, and instead of being rewarded for their work, they are loaning money to Carbondale. One speaker said the students are upset as well. They believe their tuition dollars are going to bail out a university they chose not to attend.

Dunn said he understood their feelings but reiterated that this unrestricted money is like a savings account, not operational money, and the SIUE campus should not have any programs cut or negative effect from loaning the money to SIUC.

“I get the point philosophically,” Dunn said. “On the other hand, under the auditing principles, financial management principles, and what the lawyers say, they are unrestricted funds. But I understand.” He later said for some at the Carbondale campus, it’s a difficult adjustment to realize the older campus will be borrowing money from its sister school.

Pembrook also said that even if they were not loaning money to SIUC, Edwardsville would still have to cut the $4 million from its budget to cope with the ongoing lack of state money.

The aspects of SIUE’s budget that will need to be trimmed for the $4 million include:

▪  Redesign courses to increase efficiency. Pembrook said this might mean cutting the number of sections of a class and increasing the class sizes, as well as using a “hybrid” approach to increasing the online component of some classes.

▪  Delay construction and renovation projects, specifically the plan to replace older sidewalks on campus.

▪  Move all research centers to be self-supporting. Many times research centers are launched with state appropriations, Pembrook said, but as that money dries up, the centers end up on the university’s budget. Now they will have to shift more toward finding corporate sponsors or grants to stay functional, he said. “These are things we have supported in the past, and it doesn’t mean we don’t want them,” Pembrook said. “We just have to find other ways to support them.”

▪  Increasing alternate revenue sources through University Park development, more online programming and more partnerships with local businesses.

Even with this latest, most drastic proposal, Dunn said the other university system in Illinois are facing worse problems. Northern Illinois University actually shut down for a whole week, furloughing everyone over spring break, he said.

Still, Dunn spent Thursday morning in Springfield to testify before the legislature, and then met with multiple legislators of both parties. Reactions were strong about the need to resolve the problem, he said. “I cannot overstate how much the announcement yesterday rang through Springfield,” Dunn said.

The SIUE faculty recently voted to form a union, but has not yet completed negotiation of its first contract. Kim Archer, president of the new SIUE Faculty Association, said the faculty remain dedicated to protecting students and programs.

“But we have had enough of the state’s treating public higher education and MAP grants as expendable afterthoughts. The governor needs to do his job, which is serving and protecting the people and the social contract of Illinois, not his destructive personal agenda,” Archer said. “As our colleges and universities go, so go our towns, businesses, and communities. The state has an interest and responsibility to fund higher education, just as it has a responsibility to fund infrastructure and social services. It’s incomprehensible and immoral that the governor and legislature continue to push their responsibility onto students, their families, and the communities and businesses that rely on these state institutions.”

The proposals will go before the board of trustees at its next meeting, April 6, in Carbondale.