Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, April 7, 1995 TAG: 9504070081
SECTION: NATIONAL/INTERNATIONAL PAGE: A-1 EDITION: METRO
SOURCE: ALLISON BLAKE STAFF WRITER
DATELINE: BLACKSBURG LENGTH: Long
The buyout, which closed March 31, will cost the school another $8 million. Most of that money will be paid out next year, said Ann Spencer, the university's vice president for personnel and administrative services. Whether Tech can refill those positions once severance packages are paid remains an open question, which the state, which has a hiring freeze, will answer next week.
University officials are hoping the answer is yes, tying the rehires to the school's plans to save money by restructuring.
Meantime, the budget shortfall results from several problems happening at once, including a drop in out-of-state students, who pay about $6,500 more than in-state students. Budget projectors missed this year's enrollment by 100, and the number is down by nearly 450 students from five years ago.
"Like a lot of people, I was really surprised" by the shortfall, said education Professor Don Creamer. "A novelist couldn't have cooked up more dramatic circumstances to get the institution to confront itself."
The university has scheduled a meeting Monday, open to all employees, to air the issue, after a meeting by the university board of visitors.
Departments within the university may return up to 7 percent of their budgets to the university, said Minnis Ridenour, executive vice president. Many other options to pay for the shortfall are on the table, but no decisions have been made, he said.
This year's university budget stands at $474.6 million, with $221 million going toward instruction. Of that, $119 million comes from tuition and fees; the rest comes from the state.
The state last year prohibited universities from raising tuition more than 3 percent for in-state students. Tech, believing tuition for out-of-state students has gone too high, has done the same for them, Ridenour said.
He outlined the reasons for the shortfall:
A five-year decline in out-of-state undergraduate enrollment has added up to a projected $4.3 million deficit next year.
A $4.9 million loss in state funds, which also includes an unfunded mandate from the state for 2.25 percent raises for employees.
$4.3 million in other unfunded mandates from the state and federal governments, including environmental, health, and safety issues.
Tech has found $1.3 million in savings by ending the practice of letting students pay by credit card. And it has added a $21-per-student fee for recreation programs for next year, Ridenour said.
Tech's out-of-state enrollment was 4,541 in 1990. Students paid $6,951 in tuition and fees. This year, that figure is 4,104 - and they're paying $10,404.
A new effort is being launched to recruit out-of-state students. President Paul Torgersen is sending personalized letters to incoming students' parents, assuring them that he understands their "real and legitimate concern about future price increases" and that the university will strive to control costs.
The school also is pledging that undergraduate lectures will be taught by faculty - including distinguished faculty members.
The result remains unknown.
"Basically, it means a continued tightening and trying to achieve greater economy. I think it's going to be with us through the '90s - as long as demands for social programs and prisons continue to eat up the state budget," said Henry Dekker, who sits on the board of visitors' finance committee.
"That's the sad thing about it," he said.
While administrators point out that dealing with bad budget news has become the norm since 1990, when Tech first suffered a major state cut, news of the shortfall comes amid ever-faltering morale. Professors and workers alike have listened to the Allen administration promise to cut the work force, possibly by 17,000 workers by 1998.
More than 300 employees, with only days to make their decision, applied for the state's buyout. Of those, 253 were approved by the university. The others were in jobs considered too critical to risk losing.
Just a month ago, more than 100 professors agreed to take a separate, university-offered buyout plan.
"Some people, especially people getting close to retirement anyway, figure it's in their financial interest" to take the buyout, said Larry Shumsky, president of the faculty senate. "Other people will find other jobs, move to other colleges and universities, [and] see it as a way of getting a chunk of capital at the same time they're going anyway.
"I think the underlying cause of that - why it is attractive - is that people are very demoralized and disheartened and discouraged."
Meanwhile, campus leaders are trying to keep a lid on the rumor mill.
"Frankly, at times like this, I see it as partly my responsibility to try to keep a cool head," Creamer said.
Wyatt Sasser, president of the staff senate, sent out an electronic-mail message Wednesday in an attempt to quell rumors. Of the latest shortfall, he said: "It's a lot like a snowball rolling down a mountain. It's just getting bigger and bigger."
And, Creamer said, the slide does affect student learning.
"We hear occasionally some public officials [say] all this stuff doesn't affect what is going on in the classroom," he said. "Let me assure you that is not true. Crowded classrooms, faculty with deteriorating morale, students wondering whether anybody in the society cares about them - it's a debilitating environment."
by CNB