News & Events - University of Wisconsin System
FOR IMMEDIATE RELEASENovember 7, 2002
CONTACT: Erik Christianson
5 percent budget cut could mean enrollment reductions, layoffs
MADISON - A 5 percent reduction in state funding to the University of Wisconsin System would total nearly $50 million and could result in enrollment cuts of close to 8,000 students and layoffs of almost 1,000 faculty and staff.
Those are the results of the UW System's budget reduction exercise required of all state agencies by the Wisconsin Department of Administration. The findings were presented to the UW System Board of Regents on Thursday (Nov. 7).
"Cuts of this magnitude in the base budget would require reductions in the programs, services, enrollments, faculty and staff of the University of Wisconsin System institutions," reads the budget analysis prepared by the UW System.
The budget-cutting exercise subtracts 5 percent from the state-supported portion of the university's budget. Minus funds for debt service, the state is providing the UW System $989.9 million for the 2002-03 fiscal year.
A 5 percent reduction to that amount totals $49.5 million. This reduction, if required, would be over and above the $100 million in permanent state budget cuts the UW System has taken during the past decade, including the $44 million cut in this year's Budget Reform Act, and the $16 million the UW System has returned, or lapsed, to the state in the past 10 years.
"An additional $49.5 million base cut would inevitably impact instruction by forcing reductions in faculty, staff and course offerings," says the budget analysis.
The budget analysis considers two scenarios. The first assumes the UW System would reduce enrollment by 7,816 full-time equivalency students and 968 faculty and staff to maintain current support per student without a tuition increase. The UW would also lose $23.6 million in tuition revenue due to the enrollment cut.
The second scenario allows for maintaining programs and student services by offsetting the 5 percent cut in state support with an 8.4 percent tuition increase.
The budget analysis points out that additional cuts to the UW System's base budget would be felt in local economies throughout Wisconsin as well.
A $49.5 million cut to the UW base budget would negatively impact local economies throughout Wisconsin by more than $124 million, and it would reduce state income and sales tax revenue as well, the budget analysis estimates.
While theoretical, the budget exercise highlights the difficult choices the university could face in the near future, UW System President Katharine C. Lyall told the regents.
"We did not reduce enrollments despite this year's $44 million cut, but I believe we cannot do that again," Lyall said. "Further cuts will result in either tuition increases or enrollment cuts, or a combination of both."
Lyall stressed the university is facing future cuts when students are applying for admission in much greater numbers throughout the UW System. At UW-Oshkosh, for example, applications are up 52 percent over last year, Chancellor Richard Wells told the regents.
The regents asked Lyall to report back to them in December with updated figures on enrollment, applications and other relevant data related to the budget process.
"We cannot compromise quality," said Regent Jay L. Smith of Middleton. "But we need to be prepared to make some non-traditional decisions."
UW-Milwaukee Chancellor Nancy Zimpher emphasized that additional state budget cuts would not only limit instruction but also the UW's research ability and outreach activities.
"Future cuts would impact all three parts of our mission," she told the regents.
Regent Vice President Toby E. Marcovich of Superior urged state lawmakers to recommit themselves to supporting public higher education. He said parents and students by paying higher tuition and donors and others who provide gifts and grants are continuing their support of the UW, despite the downturn in the economy.
"So far, only the people who are primarily and legally responsible for educating our children are threatening cuts," he said. "It's not right."
The board on Thursday also reviewed a series of supplemental budget initiatives for which the UW System would seek approval if additional state funds become available in the next two years. The initiatives would address pressing state needs in teacher training, nursing education and economic development.
The initiatives are specifically designed to meet Wisconsin's teacher shortages in such areas as special education; train more nursing faculty to teach at the state's technical colleges and increase educational opportunities for non-traditional nursing students; fully fund the university's Economic Stimulus Package, a series of programs at each campus designed to strengthen the state's economy; and improve student retention and graduation through increased advising, internships and undergraduate research.
"These are possibilities the state may wish to consider," Lyall said of the supplemental initiatives, which increase on average $31.2 million in each of the next two years. "If the state does not pursue them, we will stand by for a better time."
Smith concluded by saying that the efforts the state and the university have invested in economic development over the past three years have proven that "education is the key" to Wisconsin's future.
"I am worried that our elected officials view this differently," Smith said. "As a businessman, I know that in business it is very difficult to invest in your company when money is scarce - but it turns out that it is always worth it."