State cuts about $59M from budget for IU

The state will most likely cut about $59 million from Indiana University’s share of the higher education budget over the next 18 months.

It’s part of $150 million in cuts through Indiana’s seven publicly funded colleges and universities after tax revenues for the state were below projections for 14 months in a row.  The cut is 6 percent of the higher education budget and about 10 percent of the money that hasn't already been given out to universities during the past six months.

Indiana Governor Mitch Daniels told the Indiana Commission for Higher Education on Dec. 4 to recommend to him how to allocate the cuts. After working with university leaders, the commission announced their plan Tuesday.

IU will decide within the next few weeks how exactly to make up the difference. Administrators said earlier this month that tuition will not be raised for fall 2010 or the 2010-2011 school year.

The University has already implemented a hiring slowdown – effectively eliminating 50 positions in the last year. They’ve also frozen salaries, saving more than $25 million, according to an IU press release. And according to the release, IU has made $177 million in reductions this year.

IU has planned several scenarios about what to do with funding cuts, IU Vice President and Chief Financial Officer Neil Theobald said earlier this month. Administrators had said they want to make any cuts as far away from the classroom and the laboratory as possible.

In a statement Tuesday, IU President Michael McRobbie said it’s essential IU deals with the cuts without compromising teaching or research.

"However, no one should underestimate the very serious challenge that this deep cut represents, nor the impact it will have on the IU's broader contributions to the state,” McRobbie said in the statement.

The commission released some non-binding suggestions for cutting costs. Some of the suggestions include, on the academic side, promoting degree completion, eliminating or outsourcing low priority programs, looking into more online courses, using technology to reduce staff in large classes and reducing state funding to schools that allow students to go two extra semesters without graduating.

On the operating side, the commission said, in part, that universities should think about outsourcing or consolidating back-office operations such as technology, payroll, marketing and purchasing. They said working together would help, too. They recommended resource sharing between colleges and locations.

Overall, they recommended tightening efficiency and looking at what school does what best.

Jason Bearce, spokesman for the commission on higher education said when times are tight, it’s best to make every dollar go as far as it can.

“Every institution can’t be everything to everyone,” he said.