Trustees Approve Budget Plan, Still Awaiting Final State Numbers

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ZANESVILLE — The Ohio University Board of Trustees approved a budget plan Friday, while still awaiting the state budget’s final numbers.

The plan, approved at the trustees’ regular meeting at Zanesville’s campus, would dip into reserves for $23.7 million of the fiscal year 2018 budget. It also calls for a goal of 7 percent reductions in administrative costs from 2018 to 2020 and a $10 per credit hour increase to regional campus tuition, fees and rates.

Senior Associate Vice President for Finance and Administration, Deborah Shaffer; Executive Vice President and Provost Pam Benoit; and incoming Interim Provost David Descutner presented a final look at the numbers as they stand now during a Thursday meeting of the Academics and Resources Committee.

Shaffer said though dipping into reserves raised concern for some, the reserves were built for exactly that purpose.

“That’s what these reserves were built for…strategic use and reinvestment,” Shaffer said.

$15.9 million of the reserves is going to “seed institutional investments and address financial planning volatility,” according to a memo sent to trustees before the meeting. Another $7.4 million will go to planned facility projects, including $3 million in gifts to support the upcoming Perry & Sandy Sook Academic Center.

Construction of the Sook Center was also approved at Friday’s meeting.

Most of the investment made through reserves has not been on “sexy items,” she said, but instead was spent on things like roof repairs, tunnel work and overall maintenance. But the budget plan is working toward a change in focus, not just on capacity but affordability.

“Before we issue any debt, we’ll be analyzing whether we can afford it,” she told trustees on Thursday.

Shaffer said the amount of reserves spent may change if the amount the state provides the university changes in its own budget bill.

The Ohio budget bill currently sits in the Senate, awaiting committee review and approval. The university is still hanging on to see whether changes will be made to the State Support of Instruction, which doesn’t appear to be increasing as part of the Governor’s recommendations and the House version of the bill.

University officials also built the budget with assumed state increases in tuition rates, something that could need to be changed.

The 7 percent reduction in administrative costs comes after an “exercise” was conducted this year, which aimed to see a 5 percent reduction from various units in the university, according to Benoit.

That exercise resulted in $4.8 million, or 3.8 percent, worth of reductions, with some of the biggest chunks coming from Finance & Administration, Student Affairs, the Libraries and the office of the Provost.

The budget for fiscal year 2018, as presented to trustees, shows total revenues of $795.7 million ($720 million of which is operating revenues) and total expenses and cost allocations of $742.5 million.

The balance of financial resources and “financial health” was the main building block of the budget plan.

“Consequently, we have made decisions to delay or lower the level of investment in some of the initiatives while remaining committed to the priorities established by the Board of Trustees,” officials wrote in an executive budget summary.

But the budget planners say they have been trying not to make decisions that include removing people from positions.

“We’ve been trying, across the university, to deal with efficiency through vacancies or attrition, rather than having to do layoffs,” Shaffer said.

In May, Shaffer’s Finance & Administration unit eliminated 13 positions, eight of which were vacant. That same month, the Office of Information and Technology abolished 13 positions in an effort to restructure the unit. Those in OIT positions were told they could “bump” to other positions based on seniority, or apply for new jobs once OIT was restructured.

The return of the 2 percent raise pool monies is not scheduled for 2018, but it was listed as a priority laid out by the trustees during the budget plan process. Other priorities listed in the budget summary include Signature Financial Aid, Counseling & Psychological Services, the Deferred Maintenance Plan and International Student Recruitment.

The budget plan also included more monies for capital improvements, with an overall capital budget of $162.5 million.

University Planner Shawna Bolin reported on projects that are currently underway or that have already been completed.

So far, the McCracken Hall and Jefferson Market projects have been completed, along with phases of work to Seigfred Hall, Alden Library and Clippinger. Bolin also mentioned the completion of the President Street Academic Center, Cady, Foster and Brough House demolitions.

Bolin also said the aging of the buildings, some of which will be 50 years old in the next few years, warrants a change in the way maintenance is conducted. She said recommendations will come at the August meeting, but that she sees a need to change to a preventative maintenance model, rather than the largely reactive maintenance model that is currently in place.

Also approved at the Friday meeting was a quasi-endowment for technology and equipment needs, special projects and general operational needs for WOUB Public Media. The $14.1 million was obtained through an auction of broadcasting space previously used by WOUC. Withdrawals from the endowment will not allowed for three years, and must be approved by the trustees, according to officials.