UL System Preliminary Impact of Budget Reductions
BATON ROUGE – While the University of Louisiana System is continuing to review and refine individual campus plans, it has reached preliminary conclusions about the system-wide impact of potential budget reductions as high as 28 percent for Fiscal Year 2009-2010.
“The State is facing significant financial challenges, and higher education must do its share. However, in these tough financial times, Louisiana must invest in its people, and higher education is the key to the State’s long-term economic prosperity,” said UL System President Randy Moffett. “As has been communicated by the Division of Administration, this is a preliminary planning exercise and actions will be contingent upon a final budget.”
The University of Louisiana System and its eight universities, Grambling State University, Louisiana Tech University, McNeese State University, Nicholls State University, Northwestern State University, Southeastern Louisiana University, the University of Louisiana at Lafayette, and the University of Louisiana at Monroe, have a profound impact on the State’s economic vitality. Committed to enhancing Louisiana’s educational capital, the UL System has prioritized resources in recent years to improve student access and success, workforce development, and build capacity for research.
Targeted campus resources, guided by committed and hard working administrators, faculty, and staff have yielded improvements in the following performance areas:
- Improved student retention rates,
- Increased number of graduates and graduation rates,
- Reduced time to graduation,
- Targeted graduate production in high workforce demand areas (Education, Business, Engineering, Nursing, and Pharmacy),
- Increased federal research grants, and
- More jobs created through small business development centers.
Proposed budget reductions of 28 percent for Fiscal Year 2009-2010 would have a dramatic impact on the UL System’s ability to sustain quality services for its 80,000 students and all 64 parishes. A $116.4 million reduction to the operating budget of the University of Louisiana System would be significant, resulting in the loss of approximately 60 academic programs, 1,500 jobs, 3,000 furloughed employees, and a possible drop in enrollment of 12,000 students.
Beyond our campuses, these reduction measures have the potential to markedly impact the State’s economy. Using a multiplier from the Bureau of Economic Analysis on spending, it is estimated that an annual loss of $110 – $125 million would occur were the 1,500 laid-off faculty and staff to leave Louisiana. An additional annual loss of $225 – $375 million would be felt if 12,000 students were to leave Louisiana to pursue their education.
IMPACT ON ACADEMIC AND STUDENT PROGRAMS
UL System campuses estimate a possible reduction of approximately 60 academic programs under this planning scenario. Additionally, about 15 student support programs would be at risk including important instructional support and student services such as financial aid. The gains made by the UL System to improve student progression and graduation would be negatively impacted.
The initial loss of faculty would leave a long-lasting effect on the ability of institutions to recruit faculty for many years. Further, continuation of programmatic accreditation may not be possible, and essential SACS accreditation for the institutions of the UL System may be endangered.
According to McNeese State University President Bob Hebert, these circumstances are similar to the series of budget cuts higher education underwent in the 1980s. “For a decade following the cuts, we continued to pay the price because of the loss of programs, deteriorating buildings, negative impacts on recruiting, retention, and graduation rates. There was a decline in cultural and community outreach programs, K-12 outreach, and the end of economic development initiatives,” said Hebert.
IMPACT ON STUDENT SUCCESS
Elimination of programs and jobs would translate into increased class sizes, decreased class offerings, decreased student activities, and decreased availability of academic advising and student support. In addition, $1.7 million in student scholarships would be eliminated. These measures are estimated to possibly impact up to 10,000 existing students. Without scholarship support and financial aid, students would drop out or transfer out-of-state. Should this occur, critical intellectual capacity needed in today’s knowledge-based economy would be lost.
Outmigration of students is a very real possibility at Grambling State University. “With more than 40 percent of our students coming from out of state and the national impact of our noted professional degree programs, we believe it’s more important than ever to maintain the integrity of the classroom,” said GSU President Horace Judson.
For those students who continue their studies in Louisiana, an increase in time to graduation may occur, extending the current UL System average of 5.5 years. Should this happen, additional student debt and cost to the state are likely.
Another potential impact of the planned reduction is a loss of approximately 12,000 students due to eliminated programs, affordability issues in light of loss of scholarships, and a decrease in student programming activities. It is hard to measure which of these students will disengage from college and never achieve a post-secondary degree. Data shows that when a student withdraws from college and lacks support systems, re-enrollment is unlikely.
In a state where only 20 percent of its population holds a bachelor’s degree or higher, a potential loss of 12,000 students will have devastating and lasting effects.
IMPACT ON PERSONNEL
A loss of $116.4 million in funding to the UL System would mean that approximately 1,500 positions would be eliminated including in excess of 700 faculty, 300 unclassified professional, 350 classified, and 40 graduate assistant positions.
Due process would be required to reduce civil service and tenured faculty positions. Achieving these series of events in a prudent and timely manner would be challenging given the reality of the budget timeline vis-à-vis the academic calendar. Obviously, any reduction to the UL System workforce will be met with much resistance, the aftermath of which may end up costing the State unanticipated dollars.
On top of the anticipated loss of 1,500 positions, almost 3,000 employees would be furloughed for an average of 10 days. This loss of income would be felt by employees and impact the local and state economy with the associated reduction in spending and taxable income.
Furloughs, the freezing of over 500 merit increases for civil service employees, and an increase in workload to compensate the loss of positions would undoubtedly produce morale challenges. Remaining faculty and staff would be required to assume extra duties, which could translate to a decrease in productivity and loss of quality activities such as service-learning and community outreach.
IMPACT ON RESEARCH AND DEVELOPMENT
UL System campuses have achieved success and recognition in the areas of research and development. For example, the Association of University Technology Managers recently ranked Louisiana Tech University second in the nation amongst academic institutions for innovation productivity as measured by the number of new inventions generated per research dollar expended.
Under the current plan, program cuts and associated reduction of funding for research centers would severely limit current and future economic development activities, patent development, licensing of technologies, and the ability to partner research with industry.
This would affect local businesses and economies, according to University of Louisiana at Lafayette President Joseph Savoie. “The truth is that most of the nation’s fundamental research begins at universities and then moves to the private sector. UL Lafayette attracts about $50 million in external research funding each year. Those are new dollars that are brought to Louisiana. That money is used to pay salaries of people who live here. It is used to purchase equipment, supplies, and services from local and state vendors. So, when the university’s research budget is cut, the Acadiana and state economies feel the sting,” said Savoie.
In a related vein, the continuation of community development programs such as small business development centers would be in danger. These vital outreach efforts add to the economic vitality of Louisiana’s communities. For example, Southeastern Louisiana University’s Small Business Development Center since 2002 has assisted 125 start-ups or expansions with capital, helped secure over $8.3 million in loans and equity capital, created or retained 434 jobs, and trained over 2,000 private sector employees. Services such as these could be curtailed by significant budget reductions.
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EIGHT UNIVERSITIES STRONG: The largest university system in Louisiana, the UL System enrolls over 80,000 students at the following eight universities: Grambling State University, Louisiana Tech University, McNeese State University, Nicholls State University, Northwestern State University, Southeastern Louisiana University, University of Louisiana at Lafayette, and University of Louisiana at Monroe.
