The Murray State Board of Regents expressed support in their quarterly meeting Friday of the efforts led by President Dr. Bob Davies in keeping the university community informed about the looming budget crisis. Regent Chair Harry Lee Waterfield, Jr. said potential higher ed funding cuts are one of the most important issues facing post-secondary institutions in Kentucky in generations.
Governor Matt Bevin's proposed cuts are largely an effort to reform Kentucky's beleaguered pension system. In the meeting, Dr. Davies reiterated the implications the cuts would have on the university. In addition to approximately $2 million in state funding cuts this fiscal year, Murray State stands to lose another $4 million next fiscal year. These cuts follow eight years of budget reductions and puts forth "unfunded mandates," Dr. Davies said.
The decision to cut 4.5% of out of the current budget can be problematic in higher education, Dr. Davies said, because costs are usually associated and allocated at the beginning of a fiscal year. Vice President of Finance and Administrative Services Jackie Dudley said state money comes in quarterly, and not in equal proportions throughout the year. They draw from this fund each month until state allotment is gone, before dipping into tuition and fee money. The cuts will impact the education general fund, which pays for day to day operating expenses.
However, certain measures are being considered. Latency requests - positions not yet hired - is one area to look at, putting hiring on a pause (though not necessarily a freeze). Hires can be pushed back to July 1 if necessary. They've also pushed back searches for Provost and the Dean of Humanities and Fine Arts. Other one-time savings have been identified as well. Programs and services funds were being saved for investment may not occur or will be delayed.
Dr. Davies said "every aspect [of the university] will be feeling this disinvestment." Two budget task forces to identify potential cuts were announced earlier this week. Interim Provost Tim Todd oversees the "academic" task force. Jackie Dudley oversees the "administrative/support" task force. The goal is to create a framework for retention, quality and academic success by identifying "mission critical" programs that can be streamlined as well as programs that would no longer exist.
If a 9% cut is mandated in the next fiscal year, Dr. Davies said the university must adopt a strategic plan that is "robust, rigorous and challenging." There will be a greater focus on student success rate, retention rates, graduation rates, recruitment, transfer students, bringing in students from metro areas, experiential learning, academic rigor and high-achieving students. He said, however, that he doesn't want the university to just accept students who meet numbers and also encouraged faculty and student research to continue.
Dr. Davies stressed that "across the board cuts" weren't going to occur, which creates an ambiguity in contingency planning. Once the final percentage is known, along with other assorted cost increases then a flexible contingency plan can be implemented. Regent Waterfield said that even if the worst doesn't come in the next few months, it could happen in the next few years, acknowledging that the plan enables the university to be prepared for the future. In a large sense, he said, this is a continuation of a strategic plan.
Breathitt Veterinary Center
The university has already more or less deemed the Breathitt Veterinary Center as mission critical and is working with State Representatives Kenny Imes and Rick Rand among others to section off the Hopkinsville-based laboratory into a separate state appropriation. The center costs approximately $3.6 million out of current MSU state funding. Dr. Davies said the center is an important regional and statewide service and while separating funding is not a silver bullet, it's one element towards move forward.
The Governor's budget proposes phasing in performance-based funding in three rounds. If this were implemented, Kentucky would be the only state in the country with 100% performance-based funding, says President of the MSU Foundation Dr. Bob Jackson. There are no metrics or criteria existing for what a university budget would look like. He said there are 34 states that have some performance funding and these range from 5% to 25%. Most of these states also have a stop loss provision, for instance in Ohio, a university can lose no more than 2-3% in a given year.
Pension System & Other Cost Concerns
The university also pays approximately $1.3 million annually towards the pension system. Dr. Davies said no state agency other than higher ed institutions pay this as a separate bill. Other pressures include the labor standards act seeking to redefine exempt/non-exempt employee status, a potential increase in minimum wage and utility rates.
"Very Aggressive Lobbying"
Efforts of an aggressive lobbying campaign by students, faculty and staff were lauded throughout the meeting. The "Racers in Action" letter-writing campaign, a Change.org petition, Posters-at-the-Capitol, the March for education... the message is well known to legislators, Dr. Davies said.
In addition to advocacy campaigns, the administration is working with Chamber of Commerce leaders and mayors. He said other university presidents across the commonwealth are united and have "one voice" on this issue. Several regents and members of the administration have been in Frankfort, meeting with the governor and lobbying on behalf of Murray State. Regent Jerry Sue Thornton pointed out Kentucky's shifting economy: the reduction of the coal industry, new jobs and new industries emerging as a result, the need for more educated people in other professions. She said it couldn't be a more difficult time thinking about the long-term statewide economy.
Enrollment & Retention
Preliminary enrollment rates for spring 2016 are down slightly, with 8,070 undergraduate students and 1,662 graduate students, for a total of 9,732 (spring 2015 had a total of 10,133). The spring number of first time freshmen, transfer and graduate students were all slightly down or flat from the previous year.
Spring 2016 retention rate for freshmen is at 89% (up from 86.9%). Other retention rates show positive numbers as well. Fall 2016, preliminary numbers are also on an uptick. The freshmen acceptance rate is up 27%, transfer rate up 13%.
A special meeting on tuition will be held May 13 at 10 a.m.
Approvals & Other Business
Among other matters discussed in the meeting, the board motioned to approve a new master's degree program: Master of Science in Athletic Training.
Dr. Leon Duobinis-Gray was approved for designation for Professor Emeritus of Biology.
A motion carried for seeking approval to prepare a capital campaign to build a new athletic center indoor hitting facility similar to the new basketball training facility. Director of Athletics Allen Ward said the up to $60 thousand needed for a feasibility study and conceptual design would come from private gifts to the athletic department.
Three-year contracts were awarded to Head Women's Soccer Coach Jeremy Groves and Women's Volleyball Coach David Schwepker. A one-year contract was awarded to Assistant Football Coach Chris Boone.
"Plan for the worst and hope for the best," Dr. Davies said. An air of uncertainty carried through the meeting. The House has the budget and it could very well change before they send it to the Senate. There's no telling what it will look like by the time Governor Bevin gets it and signs off on the final budget.
Regent Jerry Rhoads also pointed out that the March 8 special elections could change how the House responds to the proposed budget.
To answer many of the questions lingering after today's meeting, Dr. Davies said, "We will survive."