25.2.13

SEQUESTRATION.

Betsy's Newmark recommends a Washington Post analysis of the scale of the sequester.  The proportion the reduction in the rate of increase of federal spending bears to total federal spending, let alone to national income puts the mouse and the elephant, or Z Scale and O Scale, in the same size class.


Washington Post graphic via Betsy's Page.

Here, quoting from an electronic mail circulated last fall to Northern Illinois faculty, is what a real sequester looks like.
Earlier this year, the State of Illinois announced a reduction in state funding to NIU of approximately $6,000,000. This budget reduction was allocated to the various units of the university, including our college, with a reduction of $1,419,000 assigned to the College of Arts & Sciences. That represents a reduction of approximately 3% of our core operating budget. To respond to this cut, [deans, administrators, and faculty collaborated] to develop a budget reduction plan. [Headquarters] had hoped that we would be able to find enough savings that would allow us to accomplish the needed reductions without any visible impact on the college’s operations. It is now clear that this will not be possible, and that more aggressive action will be needed to balance our budget.

The budget reduction is only for our General Revenues (02) funding. None of the action steps described below apply to our other fund categories such as fee accounts, local funds, grant accounts or foundation accounts. No new restrictions are being placed on those accounts.

With nearly 90% of our budget associated with personnel, it is difficult to absorb budget reductions on short notice. We are therefore approaching this as a two-step process. First, we will use a combination of reserves and short-term spending reductions to balance our FY 13 budget. At the same time, we will look more strategically at steps we can take to bring our permanent budget into balance. Those steps will include efforts to increase revenue, diversify our resources, and make targeted reductions and reallocations. The 3% reduction in our budget is a permanent reduction, and we will need to find permanent sustainable reductions in our FY 14 budget. However, there is no assumption that the permanent reductions made in FY 14 may or may not be the same as the reductions made in FY 13.

To balance the budget for FY 13 and to help prepare for the FY 14 budget, [headquarters calls] for a variety of immediate action steps. The following steps are effective immediately, and will remain in place through June 30, 2013, the end of the current fiscal year.
  •  Faculty Hiring Freeze: Most faculty hiring authorized for Fall, 2013 will be cancelled. A small number of guaranteed positions, and positions tied to strategic planning initiatives, may be authorized to proceed, but all other searches will be canceled. Chairs and directors have been notified individually on the status of their searches.
  • Staff Hiring Freeze: All vacancies in operating staff and supportive professional staff positions will be carefully evaluated, and a determination for each will be made whether to fill the position, freeze it temporarily, or cancel it permanently.
  • Instructional Staffing: In deploying and staffing the Spring 2013 schedule, we will need to be more conservative than we have been in the recent past in meeting student instructional needs.
  • Graduate Assistant Vacancies: All existing commitments to graduate assistants for FY 13 will be honored. However, if any students resign their assistantships mid-year, those funds will be recovered. The position will only be refilled if there is a specific instructional need that will be filled by the assistantship.
  • Non-Personnel Budgets: I am asking each unit to reduce its non-personnel budget by 5%. This includes operating budgets, travel budgets and equipment budgets. Each unit will determine how and where to take its reduction. Details will be forthcoming from [an individual] in the college business office.
  • College Travel Supplements: The college will honor the commitments we have already made for travel supplements. However, for faculty and staff, the college will only authorize new travel supplements for untenured faculty, and will only do so if there is a 1-1 match of unit-level funds. The college will continue to provide awards for student travel (both graduate and undergraduate students) from our Foundation accounts, as long as funds permit.
In making long-term reductions, our priorities will be to protect our core missions of teaching and research, to protect our highest quality programs, and to make the most efficient use of our resources. This will not be simple, and it will take some time to develop and announce a permanent reduction plan. [The aforementioned collaborators will work with] the College Senate [the committee of department chairmen -- ed.] to develop and implement a thoughtful, sustainable budget plan.

Once we have absorbed these reductions in FY 13 on a one-time basis in FY 13 and make them permanent in FY 14, [The author of the memo hopes], but certainly can’t promise, that we will not have to make any further reductions. With pension reform still in the wind, economic recovery still sputtering and enrollments still lagging, we have some distance to go before we can be sure that our general revenue budget will remain stable. [The author knows] that this kind of continued uncertainty is unsettling and tiring. [The author appreciates] all that you have done as we have worked through the challenges of the last few years, and, with your help, ... will do my best to address these new challenges.
The "continued uncertainty" has been going on for 20 years, with several different deans having to retrench in some way or other.  When I hired out in 1986, my department was under strength compared to economics departments in universities with comparable enrollments and responsibilities.  Administrative burdens have increased for faculty, and my department is about half the size it was in 1986, despite total enrollments being similar.  That "lagging enrollments" is relative to strategic plan targets.

Despite the retrenchments, there is still money in the budget for the women of the fevered brow to commemorate fifty years of The Feminine Mystique, complete with retro-Sixties posters all over campus to promote the schedule of events, and at the university level, there are resources for a football preview and book debut even before spring camp opens.

At the federal level, the Washington Monument has been closed for over a year.  We'll survive the sequester.  Surviving administrative preferences, locally or nationally, is another matter.

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