UCM planning for tight FY18 budget

By Nicole Cooke - [email protected]

WARRENSBURG — As the University of Central Missouri gets farther into the planning process for Fiscal Year 2018, school officials are working to come up with more than $20 million in additional revenue or cutting costs to keep up with a “financial perfect storm.”

According to a memorandum sent to UCM staff Tuesday by President Charles Ambrose, multiple factors are causing the public four-year university to face a budget reset of roughly $21.5 million compared to FY17, such as:

• Gov. Eric Greitens has proposed a $5.2 million reduction in the university’s net state appropriation, although the House proposal would only be $3.8 million.

• UCM faces a $14.5 million forecasted reduction in tuition revenue, mostly from a decrease in international students caused by recent federal policies.

• The FY18 budget must be adjusted for mandatory cost increases of $2.8 million including an increase in the Missouri State Employees Retirement System (MOSERS) contribution, Fair Labor Standards Act (FLSA) changes and health premiums.

Ambrose said the first step is evaluating the tuition rate. The Board of Governors approved a 0.7 percent increase during its March meeting, which means an extra $1.63 per credit hour, or $48.90 per year based on a 15-hour course load.

“What we’ll do is attempt to keep our costs down as long as we possibly can,” Ambrose said during a media opportunity Wednesday morning at UCM. “As we go into this board meeting anticipation is we will pass (an additional) tuition increase but it will be held at inflation, which would take undergraduate tuition from $214 a credit hour to $221. Which is a very nominal increase. It would somewhat be massive the loss of support and services if we didn’t consider some increase up against the loss of state support.”

The next step is looking at institutional savings by an internal deadline of May 15. Ambrose said they are still looking at institutional savings and efficiencies before asking specific departments, everything from educational departments to athletics and other co-curriculars, to share the remaining burden.

UCM is offering the Voluntary Retirement Incentive Benefit to its 270 retirement-eligible faculty and staff members, incentivizing them to retire.

UCM is also under a hiring freeze for the 42 general fund and 15 facilities, planning and operations positions that are vacant. Some of those positions may eventually be filled, but some may be eliminated.

An administrative review is underway to evaluate various aspects of the university to find ways to consolidate, eliminate or improve efficiencies across campus. Some of those items include maintaining high-quality, essential services, eliminating duplications and low-priority activities, shifting costs from General Fund to other funding sources where appropriate, repurposing underutilized facilities, insurance review and deferred maintenance, among others.

Finally, step three is evaluating net productivity, which includes an academic program review conducted under guidelines from the Missouri Department of Higher Education. The review began in February, with a final report due in mid-December.

UCM went through a program review several years ago, which resulted in eliminating several programs and expanding others. Ambrose said the review will help the university identify programs that are/aren’t in high demand from students and that produce/do not produce students viable for employment.

Ambrose voiced concern about the impact of federal policies on international student enrollment at UCM, noting international students should be seen as assets not liabilities. According to the memorandum, international enrollment from India is forecasted as much as a 70 percent reduction across American institutions.

“I am more concerned long-term about higher ed policy that basically discourages international enrollment in American higher education, probably than any single factor we may be challenged with,” Ambrose said. “It could easily push to a billion dollars of lost revenue across the enterprise for next year, and … there’s a doubling effect of revenue loss from enrollment.”

Student recruitment as a whole is also proving difficult for Missouri universities because there is a smaller population of high school students. To help offset lower international numbers, Ambrose said UCM is working to recruit more adult students, especially for graduate programs and classes at its Lee’s Summit campus.

The solutions university officials are finding are both long- and short-term, but more long-term solutions may be needed. At this point, it’s unknown if Greitens’ education budget cuts are going to be temporary or the new norm.

“There’s a lot of decisions we’ll make that will not produce the kind of immediate results that are required to save $20 million,” Ambrose said. “But at the same time, if we’re at a static or perhaps declining investment from the state appropriations, and this international student enrollment isn’t coming back, the ultimate objective is just to find that sustainable platform to start growing again. “


By Nicole Cooke

[email protected]

Nicole Cooke can be reached at 660-530-0138 or on Twitter @NicoleRCooke.

Nicole Cooke can be reached at 660-530-0138 or on Twitter @NicoleRCooke.

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