McRobbie orders $4.9M cut in budget

IU took a direct hit Wednesday from the state of Indiana’s economy.

IU President Michael McRobbie announced a reduction of $4.9 million in the operating budget for all IU campuses. However, IU spokesman Larry MacIntyre said students should not feel its effects.

“Hopefully it will have fairly minimal impact,” MacIntyre said.

To make up for the reductions, MacIntyre said McRobbie has suggested less administrative hiring and less travel, among other operating cuts.

“Every dean and every chancellor will have to find some ways to save money,” MacIntyre said.

The budget cut results from a decrease in the state’s funding of higher education. IU Vice President and Chief Financial Officer Neil Theobald said the state did not receive as much tax revenue as anticipated.

Indiana could not give IU the full amount planned in the original budget, so 1 percent, or $4.9 million, needs to be cut.

“We are only going to get 99 percent,” compared to what was originally expected, Theobald said.

The cut affected each campus’s operating budget proportionally. MacIntyre said the IU-Purdue University campus saw the biggest reduction of $2 million, while the Bloomington campus was second with $1.9 million.

Theobald said reductions that come after the original budget tend to be difficult.

“It’s always harder to make cuts in the middle of the year, because you already made commitments to people,” Theobald said.

But despite the trim in money, MacIntyre said the University does not want to hinder its mission of education. The funds already allotted for student financial aid and technology will remain the same.

“As funding is reduced and spending reductions are made, it will not impact education,” MacInyre said. “We’re trying to exclude the impact on faculty and student aid.”

But Bernard Hannon, associate commissioner of finance for the Indiana Commission for Higher Education, said public universities get their money from state funding and student fees, so when state funding goes down, student fees often go up. He said this happens about every 10 years, when a recession hits.

To reduce the possible increase for students, Hannon said his commission is advising universities to spend more efficiently, such as turning down the heat in buildings or hiring fewer people.

“We’ve challenged presidents to try and spend less money as a whole,” Hannon said.

Yet despite changes, more budget cuts are expected in the future. Theobald said the University has submitted a joint request with the IUPUI campus to the state for the 2009-2010 fiscal year, but the legislature ultimately makes the decision.

MacIntyre said he does not know how much future reductions will influence IU.
“It’s going to be tight,” MacIntyre said. “We just don’t know how tight yet.”