November 8, 2001

Contact: Bob Bruce, 503-725-5714
Tom Anderes, 541-346-5738

Proposed OUS Budget Reduction Plan Protects Instruction, Access

EUGENE - Oregon's public universities aim to protect instruction and access to it in any additional budget reductions required by the state through 2002.

A draft budget reduction plan -- that will discussed for the first time Friday, Nov. 9 during a 2 p.m. conference call among members of the State Board of Higher Education -- gives priority to preserving instructional programs. And any cuts assigned to higher education will place greater burden on reducing administrative and targeted programs.

"Our plan precisely follows the directions given to higher education by Governor Kitzhaber and adheres to 2001-2003 budget priorities set by the governor and the Board, " said Tom Anderes, Oregon University System vice chancellor for finance and administration. "Our goal has been to develop a plan that is equitable, avoids across the board cuts, and protects - as much as possible - the integrity of our instructional delivery across the state."

Under the governor's direction, all state agencies are developing programmatic reduction plans to help balance the state's budget. Oregon currently faces a budget shortfall of more than $300 million. That total is expected to grow as new revenue forecasts become available. State agencies have been asked to propose reduction plans in 2 percent increments up to 10 percent, to help state officials strategize for those anticipated shortfalls.

The higher ed draft plan to be discussed Friday shows a variety of potential impacts. At the 2 percent level, the state's universities would need to cut about $16.7 million. At 10 percent, the cut would total roughly $80.9 million.

At all levels, the proposed plan places greater burden on proposed cuts in administrative and targeted program areas. At the 6 percent level, targeted programs would contribute $36.8 of the $48.5 million total. At the 10 percent level, targeted programs would make up $42.1 million or about 52 percent of the required cut.

Other proposed reductions include significant cuts in statewide public services and central service programs. Statewide services include extension, experiment stations and the forest research laboratory. Central services include the Chancellor's Office.

"The strategy to increase targeted programs' share and limit instruction impacts benefits all universities," says Anderes. "It allows our universities to avoid instructional cutbacks at reduction levels below the 6 percent threshold. If that buffer is not shared, some campuses would need to look at paring instructional costs at about the 3 percent reduction level."

Under the proposed plan, campus reductions at the 10 percent level would range from 11.5 percent at Oregon State University -- which has the largest operating budget in the OUS system -- to 7.2 percent at Western Oregon University. Regional campus reductions are generally lower than at the larger universities that have more extensive research and public service programs.

The plan also protects new and expanded educational initiatives supported in the last legislative session until higher levels of reduction are required. Thus, no impacts occur on investments to double the number of engineering graduates, build a top tier engineering school, improve small school allocations, or grow the new OSU Cascades Campus in Bend below 6 percent reduction levels. And only small reductions are projected above 6 percent.

No action on the plan is expected during Friday's teleconference meeting of the State Board. It will become an agenda item for the Board's next regular meeting on Friday, Nov. 16 in Portland. Once approved, the plan must be submitted to the governor by Nov. 19.


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