Last Thursday, ETSU President Paul Stanton spoke candidly to student, faculty and staff about how the university will handle the financial problems he anticipates will be affecting ETSU in years to come.
Stanton decided to hold the meeting after receiving a letter from Nashville two weeks ago outlining new budget guidelines Gov. Phil Bredesen is asking all that higher education institutions in Tennessee to follow.
Satisfying the governor’s request isn’t going to be easy and it means personnel and the number of course offerings, among other things, may be cut.
The current year’s budget has already been reduced by 5 percent or about $4.2 million. Next year’s budget is expected to undergo an 8.8 percent slashing of about $7.4 million.
Every dollar spent at ETSU will be scrutinized in the coming months, Stanton said.
“We are going to have to identify $3.5 million dollars in personnel reductions,” he said. That would equate to 100 jobs.
A freeze has already been placed on new hiring and travel. Currently, there are 92 vacant positions and some personnel may also be asked to move from 12-month to nine-month contracts. Stanton said every position not filled will save the university about $35,000.
He will approve any position he has to for school accreditation reasons, but a new hire could be at the expense of someone else’s job.
Athletics programs may also feel a bit winded after the final budget cuts are made. A proposal to eliminate state money for athletics could add another $1.2 million to ETSU’s deficit problem.
He said he didn’t know what the legislature might do because “the pots of money” are all gone.
“Even our rainy day fund has bled down to nothing,” he said.
Tuition and fees may also be raised. In the past six years, they have gone up 52 percent.
In recent years tuition hikes have been a good source of money in a financial crunch. Stanton said increases have saved the university in the past by securing $225,000-$230,000 dollars for each 1 percent increase. However, Stanton said the Tennessee Higher Education Commission (THEC) is not looking at a major tuition increase.
Stanton also said not to count on the lottery approved last November to help higher education crawl out from its current fiscal hole.
He voted against a state lottery and said it might even have the potential to hurt ETSU. However, he also has the mixed fortune of being on the lottery commission.
“I’m one of the few people who could vote against something and then be put in charge of it,” he said.
It costs $9,000 a year to educate a student, but the lottery would only give the university $4,000 dollars per student. “The lottery doesn’t put a single dollar into operation,” he said. “For every student you’ve got a new $5,000 problem,” he said.
There is even talk of setting an enrollment cap, but Stanton said if that happens ETSU won’t see a decrease in state funding. Currently money goes to schools where growth is taking place. “Normally, that would mean ETSU would lose money to those schools, but the state won’t cut funding if we downsize,” he said.
Stanton said he doesn’t see any major funding relief coming from the state in the next three to four years.
This difference between last year’s budget crisis and this year’s is that last year ETSU got a bailout from the state, but Stanton doesn’t believe that is going to happen this year.
One student asked how budget cuts would affect summer school. Stanton said he didn’t know what they were going to offer, but said they still plan to have summer school. He added that some state schools are looking at eliminating summer school.
Stanton said he has been working closely with Nashville to work through the financial problems and thinks that the governor is doing the right thing although it’s going to hurt higher education.
He also said if the budget keeps going the way it has, ETSU won’t be able to be everthing it has been in the past.
However, he promised that ETSU would maintain quality education. “I’m not trying to alarm anyone unnecessarily,” he said. “Between now and July there are going to be some changes,” he said.
A web site has been set up to collect any ideas employees may have about dealing with the budget. It can be found at www.etsu.edu/president/survey.

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