It’s a biennial budget year here in Wisconsin and as soon as the November elections are over, the 2015-17 state budget will be the focus of much of the work of our elected state leaders. As I said this week during my State of the University speech to the Faculty Senate, this upcoming budget will be particularly important for us at UW-Madison, given that we received substantial cuts in the budget two years ago. I want to describe the challenges facing us and what we’re doing to prepare for them.
The higher education system in this state is central to its long-term economic competitiveness and growth. Having a world-class educational and research institution in UW-Madison gives this state a big advantage in attracting high-tech and growing industries to this state. Maintaining the excellence of our university and our overall Wisconsin system should be a high priority for anybody who cares about future job growth.
It’s no secret that the UW System and, in turn, UW–Madison received some major cuts in the current budget enacted in the spring of 2013. Over the past year we were able to absorb the impact of these cuts by spending down our fund balances to fund programs and services across campus, as the state legislature directed.
However, we can’t continue to fill the budget gaps with fund balances. At the end of this fiscal year, our tuition fund balances will have declined almost by half, from 14 percent to 8 percent. I cannot in good conscience draw them any lower, given the need to keep some funds on hand to deal with the uncertainties we face as a large and complex institution.
In fact, most of our fund balances are already fully committed to approved programs or facilities, but just haven’t been spent yet. We have little that can be labeled as true reserves. That means that the university has very few discretionary dollars available to meet unanticipated needs that might arise on campus this year.
If we do not receive an increase in our educational funding, we will have to implement substantial cuts. With no change in the budget, we will need to cut a little more than 4 percent from all of our state and tuition-funded programs.
The 2015-17 biennial budget request made by UW System President Ray Cross and the Board of Regents proposes to avoid many of these cuts and would help put the higher education system on a firmer economic footing.