Mayville State President’s Column for Traill County Tribune
February 27, 2016
Growth and prosperity will continue at Mayville State, in spite of large budget reductions
The price of oil has fallen. North Dakota has gone from seeing the biggest growth era in the state’s history to one of the largest declines in a very short period of time. I have been asked how Mayville State University will be affected by and how we handle such situations, so today my topic is handling reductions.
The University System was notified on November 20, 2015 that some budget reductions could be required, perhaps up to 2.5%. If that happened, it would mean a reduction to Mayville State’s operating revenues by $409,503. Besides this amount, we also had revenue shortfalls due to more than expected part-time student numbers in our student count and this created another $200,000 of reductions. Our budget analysis at that time gave us confidence that our strong campus situation would provide us with the means to handle these budget reductions without a great deal of difficulty, and I reported this to the campus in January.
We had barely completed plans for the 2.5% budget reduction when Governor Dalrymple announced on February 1, 2016 that 2.5% was not going to be enough and that an increase to a 4.05% reduction would have to be made. This meant that another $276,173 dollars of new reductions would have to be made, and that final budgets were due by Monday, Feb. 22. The state’s campuses and other state supported entities would have just three weeks to respond. For Mayville State, just under $900,000 in total reductions would be needed to satisfy this latest budget request. We also needed some additional reductions due to utilities increases, inflation, special assessments move into operating accounts, and additional adjunct professor salaries due to increased enrollments. The campus faced a significant challenge, and these reductions would be retroactive to the beginning of the 2016 fiscal year.
All our required reductions have to come from state appropriated dollars. Money that is not appropriated by the state, such as grants and other soft money, does not apply to these reductions, nor can they be used to help reduce any state appropriated obligations. The challenge to my president’s cabinet was to keep Mayville State University strong well into the future while reducing $900,000 from our current state appropriation.
Our new budget would have to comply to all the new federal mandates, accreditation and assessment dictates, state requirements, and North Dakota University System (NDUS) rules, as well as new demands for safety, graduation and retention rate improvements, student service changes, and of course academic growth, innovation, and excellence. The State Board of Higher Education (SBHE) also identified areas of funding that could not be a part of this budget exercise. We clearly had our work cut out for us.
We also agreed as a cabinet to do everything in our power to keep raises and salaries as high as possible. Our campus success has been due to our dedicated employees and we decided that our salaries must be maximized so we can attract and retain quality employees.
Although not actually a part of the reduction process, the cabinet also faced the SBHE charge to streamline academic programs and to eliminate low enrollment programs. This charge hastened some academic decisions and resulted in the loss of one academic program.
The budget deadline of Feb. 22 has been met and our new budget has been submitted to the NDUS. The results of our budget deliberations have been quite successful when you consider the enormity of the reductions we faced. We expect to offer a full 3% raise based on performance, just as we have always done. This is the full amount the SBHE authorized our campus for raises before any budget reductions were anticipated. I consider this a remarkable budget feat.
As far as any impact to faculty or staff, we will have approximately four positions that will be reorganized, or possibly downgraded. This depends upon how well everyone on campus controls their spending and how many employees respond favorably to new buyout options recently approved by the SBHE. We will be taking some time to ensure that any affected employee is given the best options possible to minimize any negative effects. Finalization of these issues could take well into the summer months. The bottom line is that our employees’ earning power will be preserved. We will be able to continue to attract quality employees, and relatively few positions out of a staff of 200 will be affected.
How will all of this affect Mayville State’s future? I don’t see any significant negative affects coming from our budget reductions. Although we cannot predict what will happen in the next few years, we are optimistic that this budget exercise has fully considered the long-term needs of the campus, the short-term necessities, and the well-being of our employees. All academic and campus initiatives will continue and our campus will continue to be proactive in terms of student growth and quality. Hiring for critical positions will continue and all new initiatives will still be pursued.
As a part of the process, we have tried to mitigate potentially difficult situations for the coming biennium by making stronger decisions now. We want to avoid difficult reductions later. We could easily receive a reduced budget the next legislative session, so we must be conscious of any expenses that carry over into the next biennium. It is incumbent upon the state legislature to be financially responsible, and it is our duty to accept these changes and help the state through a difficult situation.
North Dakota law requires a balanced budget, and if all our campus employees work together, I am confident we can continue our growth and prosperity. I also ask the community for their support. Our decisions are very complex and it is not likely the general public will have sufficient information to scrutinize them appropriately. If you are wondering why certain decisions were made, please let me know. I can assure you that each decision is backed by significant factual data and careful deliberations.
I want to specifically thank my cabinet for doing what seemed nearly impossible just a few days ago. These individuals were intense in their efforts to protect Mayville State University’s future, its employees, and its students. Given the enormity of the reductions required and the short timeline they had to create such a comprehensive budget, I consider their work nothing short of outstanding.
I am grateful our campus was in a strong position and able to handle these large reductions. I am also grateful that Mayville State University will be able to offer its personal service and quality education well into the future. Thank you all for your support for Mayville State University. As you can see, there is no reason not to continue this support! Thank you.