Horvath: College facing budget gap

Huge budget gaps are looming for SUNY Fredonia if major changes are not made.

SUNY Fredonia President Virginia Horvath recently presented the college’s situation to the community.

She said many of the problems facing SUNY Fredonia are not unique to the college, in terms of an unsustainable financial model, lowered enrollment and retention, use of adjunct professors and decreasing state support for public universities.

Horvath said she has heard that private and public universities operate on an unsustainable financial model, but has yet to hear of a solution. She also said she thinks they cannot hope for the funding levels of the 1960s to 1980s to be restored, but did propose some long-term goals and solutions to address some of the other issues facing the college.

She said budget numbers change constantly, but projected millions of dollars in deficits in the next three years.

With a roll-over budget from 2013-2014, the school faced a $7,727,056 shortfall for 2014-2015. Horvath said with $1.8 million in reoccurring offsets, $1.2 million in salary savings, $3,399,305 in tuition over target and $1,310,305 in reserves, the college will be able to close the gap for the coming year.

However, the picture for the three years following is much grimmer, with all of the college’s reserves spent in 2015-2016 there is still a projected shortfall of $1.5 million after cost saving measures. With no reserves left, over $4 million shortfalls are projected in 2016-2017 and 2017-2018 after the same cost saving measures are taken into account.

When former SUNY Fredonia President Dennis Hefner retired, it seemed that the college’s tough financial times were over. However, Public Relations However, Public Relations Director Michael Barone explained several things have changed since President Hefner left the university.

“I think there are two big things have changed since hearing that from President Hefner. He fought for a long, long time to get a rational tuition plan approved by the SUNY Board of Trustees and the New York State Legislature. What that means is there was a five-year agreement to a series of small but predictable increases in tuition. What that does for every campus in the SUNY system is allows us to better plan. It also helps out families immensely too because, they are not surprised when there is an increase. . They did approve that, but it is only good for five years and we are nearing the end of that. So, we are looking out for that and so far there has been nothing discussed or indicated that they are ready to go forward with another one. Until that happens, we have to assume the worst case scenario.

“The other thing has nothing to do with our campus at all. There is a hospital down on Long Island that belongs to the SUNY system that unfortunately was a real drain financially on the system. They finally made the decision to get rid of it. What the final impact of what that will mean is still not yet known exactly, but it is clear that it will make a significant dent in the overall SUNY system budget,” Barone said.

He added the campus’s own enrollment also heavily comes into play with this, the numbers of which will not be fully known for a month or so.

In addition, SUNY schools are facing an unfunded state mandate.

“All of the employees on campus have had a wage freeze for the past two years. We have seen a change in that where the unions were successfully able to negotiate a 2 percent increase in salaries per year. It doesn’t sound like a lot of money, but when you multiply that by the hundreds of employees that we have, it does add up. Even though they were able to successfully negotiate that increase at the state level, there was no corresponding increase in revenue from the state to cover that increase,” Barone explained.

Horvath related the college’s situation to that of a household that has just enough budgeted to cover an unexpected expense and gets to the next paycheck just in time.

She said the college needs to focus on other solutions besides “band aid” solutions.

“What we have done in the past, and some of you may remember President Hefner going through the budget line by line, that gets us through the year, but what we need to do is look to the future. Because if we continue to do that, if we continue to put a band aid on that year’s budget and say, ‘Well, we got through that,’ it puts us in the same position every year of having to struggle and feeling that we are not in control of our own destiny,” she said.

Many of Horvath’s solutions center on increasing enrollment and retention, addressing staffing and finding revenues other than state aid.

Barone said the college is in the process of exploring new revenue possibilities outside of tuition.

“We have a lot of different initiatives out there right now that are looking at increased revenue options. There are possibilities surrounding the new StartUp-NY initiative that could result in new revenue, we have an initiative that would bring students to our campus who are interested in learning English as a second language we are continuing to look oversees at international enrollment and out-of-state because they represent a larger tuition revenue stream,” Barone explained.

In the short-term, Horvath said the college would like to increase its over enrollment by 50 students, increase summer session and J-term to contribute $20,000 to the budget and have the College Foundation increase its scholarship contributions by $100,000.

Other goals to be completed by fall 2016 included drafting a strategic enrollment management plan, building a schedule based on student need, increase the number of classes taught by tenure-track professors to 75 percent, increase the student retention rate to 85 percent, establish a minimum adjunct rate of $1,000 per credit hour and clarify adjunct titles and ranks.

Barone noted that the college plans to “do what makes sense” in staffing and utilize full-time faculty at full capacity and then use adjuncts where there are gaps.

Horvath concluded by saying the college will evaluate hiring and vacancies, invite suggestions on cost savings, break old habits of adding without cutting and engage the entire campus more in enrollment and retention of students, but it will not panic, resort to quick fixes or move away from its mission.

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