Apr. 15, 2014
Managing in a New Budget Reality
Dear Friends and Colleagues,
As you may know from reading university, campus, or regional news reports, the legislature has frozen tuition and general support for state universities. Our trustees met several times in March and April to discuss how to manage these restrictions in a way that least harms students and the university.
They recognized that during the Great Recession when we lost half of our state funding, we absorbed most of the reductions through cuts in operations. Academic and student life avoided nearly all employee reductions. The board has concluded that continued reductions in operations would place at risk our ability to comply with fiscal, health and safety requirements, and could erode programs that recruit students and develop external funding.
When the board met in April, trustees directed the following approaches to managing what will be a very significant budget gap.
1.) Deepen our commitment to responsibility centered management, or RCM. This is a philosophy that places management decisions about our colleges in the hands of the people who run them--the deans and chairs. Deans and chairs decide what areas of their disciplines to emphasize and grow to meet student demand and to increase revenue. Deans and chairs decide what areas lack demand or quality and must be revised or even eliminated.
This is a dramatic change from our approach four years ago, which amounted simply to a directive to cut. Today the direction is to manage to a new number--by shifting responsibilities, growing programs, changing the way we offer programs.
2.) Develop new tuition options. The board discussed implementing, by this fall, a new approach to tuition--new to us, but in operation at nearly all community colleges. CWU charges the same flat rate for students carrying 10 to 18 credits. Some version of the community college per-credit model would provide great flexibility in generating additional tuition waivers as well as increased tuition revenue.
3.) Use "rainy day" funds to sustain critical functions through the upcoming academic year. We are all in the "business" of developing human beings, not manufacturing widgets. We know that change takes time and we must avoid adverse effects at all costs. CWU has a rainy day fund of about $3.7 million that will help us get through the upcoming year in a way that disrupts the studies of as few students as possible.
The board has given us direction; now it's time to go to work. Last Friday and today Provost Levine, CFO Clark, and I have met with academic and student-life leaders to describe the challenges ahead. There's more to these challenges than I can fit in one memo, so I will continue to write about our challenges and invite you to participate.
No one needs more e-mail, but everyone needs to understand what lies ahead. Remember: we're no longer bound by the old ways of simply thinking about how to cut. We used to be bound by the size of the box; we pared and cut until we could fit inside the budget box. Now we can change the size of the box, by enrolling more students. And we can change the shape of the box by delivering programs in new ways.
I will post this and future briefings to Central Today (cwu.edu/news) and to my home page (cwu.edu/president), and will continue to meet with and discuss this challenge with as many people as I can about our changing future.
President James L. Gaudino