If the federal government approves a waiver filed by the state allowing for further cuts to higher education, CSU could experience $14 million to $16 million more in cuts, CSU President Tony Frank announced in an e-mail Friday.
CSU began planning for the second round of potential cuts — the university experienced a $30 million shortfall after state cuts this spring — several months ago after learning that the state had applied for a waiver to slash the higher education budget under the American Reconstruction and Reimbursement Act, Frank said in the e-mail to the university.
If the second cut goes through, Frank said it “becomes a backroom exercise that’s a big deal” for administration. The hole left by the cuts “should be transparent to the campus” because the ARRA legislation would require the state to return the money in CSU’s budget in fiscal year 2011.
Colorado already reached the maximum higher education cuts allowed under the ARRA when it slashed more than $300 million in April. These cuts resulted in a $30 million loss from the $130 million provided annually to CSU, or 3.75 percent of the university’s $800 million annual budget.
Through 2012, the $30 million hole left in CSU’s budget will be filled with federal stimulus money.
In an attempt to wean the university off federal funding before it evaporates –/a struggle Frank compared to standing on a melting iceberg — CSU officials have been charged with the task of reducing spending by 6 percent in FY11, according to Frank’s e-mail.
Administrators have also been asked to consider the effects of a worst-case scenario — 17 percent budget reductions within the course of a single fiscal year. This scenario is unlikely and would only be seen if the second round of budget cuts go through and the university sees no cost reductions or tuition increases in the next two years, Frank said.
The spending reduction is engineered to reduce the immediate impact of larger state cuts on campus by cutting small amounts across the board, rather than making large cuts to research or specific colleges as suggested by some, Frank said.
Students may not immediately see the impacts of budget cuts on the campus itself but may suffer from later effects on higher education in general, political science professor John Straayer said.
“If nothing is done statewide, the long term projections for higher education are grim, Straayer said, “Deeply grim.”
Due to low tax rates and the Taxpayers Bill of Rights, or TABOR, that limits government taxing and spending, the state has been placed in a “fiscal straightjacket,” making it unable to provide for the future of public higher education, Straayer said.
If policy does not go unchanged, public higher education could become a part of Colorado’s history, he said.
Others at the university do not share Straayer’s concerns.
“I get worried for CSU when I see problems here that I don’t see elsewhere,” said Greg Graff, an assistant professor with the Department of Agricultural and Resource Economics.
The budgetary concerns CSU faces are similar to those faced by other universities, which Graff said supports the idea that CSU will recover along with the economy.
Senior Reporter Matt Minich can be reached at email@example.com.