Countdown to budget crunch begins

An earlier version of this article mentioned that university employees received a two-percent salary increase this year. It should have been specified as an increase in the overall salary pool. Not all employees received a 2-percent increase.


Ball State President Jo Ann Gora and other top university officials are meeting with Indiana lawmakers today to ask for continued support in the face of faltering state tax revenues.

The school has already cut $15.2 million from its current budget, and Gora earlier this semester warned that the tough times are not over.

"I would like nothing more than to tell you that the possibility of budget cuts is a thing of the past - but I don't believe that is true," she told faculty members at a speech in August.

"Instead, I believe that we have entered a new era in higher education, where the ‘public' in public education will increasingly examine our actions, from kindergarten all the way to college."

Gora and her team will meet today with the State Budget Committee, a panel of five state lawmakers, to defend the university's vision for the future.

The meetings are part of a lengthy process that determines how each state college will spend its portion of the state's $2.7 million fund for higher education. The public colleges submitted their general budgets in September to the Commission for Higher Education, which makes recommendations to Gov. Mitch Daniels regarding funding. A final state budget should be determined April 30 at the conclusion of the General Assembly.

The panel is led by Sen. Luke Kenley, R-Noblesville; Rep. Peggy Welch, D-Bloomington; Sen. John Broden, D-South Bend; Rep. Jeffrey Espich, R-Uniondale; and state budget director Adam Horst.

They'll hear pitches from people representing about two dozen sectors receiving state support, including education, public transportation and others. Regarding higher education, Kenley said the committee will consider how well schools are spending money now, based on such factors as salary increases, graduation rates and overall efficiency.

Education isn't the state's only priority, of course. Representatives from public transportation and other sectors that depend on public funds will also meet with the committee this week in hopes of securing their own support.

Lawmakers have tough decisions to make. A report last week showed that the state took in $6 million less in October than the same period a year ago, even as the economy showed signs of strengthening elsewhere.

The revenue shortfall is being made up in part with money from the state's reserves. Daniels has ordered state agencies to cut spending by 15 percent.

With Gora today is Bernie Hannon, associate vice president for business affairs. He said to Ball State's record enrollment and retention, and improved freshman SAT scores should help cast a brighter light on the university when compared with the six other public colleges and universities in Indiana.

Ball State is growing its enrollment, topping at 18,183 students this year, while also improving is retention rates, which is approaching 80 percent, Hannon said. The university's 4-year graduation rate us up 63 percent compared to 1996, and freshman SAT scores are up about 50 points since 2003.

The State Budget Committee will also ask about salary increases and health care coverage for employees.

Last spring, the university spent $1.8 million for a 2-percent increase in the salary pool for employees. A slide from the February campus forum mentions a "2 percent salary pool [increase] plus $400 across the board in most areas."

Salary and benefits accounts for 77 percent of the school's budget, and employees had not received an increase in two years.

Hannon said legislators might not consider the increase a god decision, since other state employees did not get a raise.

In regard to health coverage, the university adopted a plan that it said was a better deal for university employees and for the school's bottom line. It called for employees to join the Encore and Encircle networks, and in doing so, in-patient claims were reduced by 10 percent in some cases.

Besides convincing the State Budget Committee, Ball State had to prove itself to the Commission for Higher Education during a similar hearing last month. The university is working to achieve all the requirements specified in the Commission for Higher Education's 2007 initiative Reaching Higher. The initiative calls for improvements in college preparation, affordability and graduation.

Last spring, Indiana public universities had to figure out how to split a budget reduction of $150 million. Ball State landed right in the middle of the pack with a $15 million budget reduction, representing 5.5 percent of the school's $277 million biennial appropriations. Horst said he can't speculate how much will be cut this year.

"We're essentially in a spending-freeze environment," Horst said. "If we can get the revenue to catch back up, we think we can get back to a structurally balanced budget."


Budget hearings chain of events

September - Indiana public universities submitted general budgets to CHE

October - University officials met with CHE members for an initial hearing

Today and Thursday - University officials will present to the State Budget Committee

December 15 - CHE will make recommendations to the budget committee

January - Daniels will pass along funding recommendations to the Indiana House of Representatives

February - The House will review recommendations

March - The state Senate will consider recommendations

April 30 - Budget cuts will be determined at the end of the Indiana General Assembly

By the numbers

$2.7 billion - Total biennial appropriations for Indiana public higher education

$277 million - Ball State's biennium budget

$15.2 million - Ball State's portion of the state's $150 million budget cuts in the last biennium

$1.8 million - Put toward a 2 percent salary increase for Ball State employees this year

77 percent - Portion of Ball State's budget devoted to employee salary and benefits


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