Last week, UNM President Bob Frank informed attendees of a town hall that the University is facing budget cuts as a result of the recently-finished state legislative session, briefing a mix of students, staff and faculty on the tough competition for state dollars this year.
“They have taken money out of our current budget and they also have cuts for the forthcoming year,” he said.
UNM will receive a total reduction of 0.6 percent from the current budget, Frank said, meaning a total recession of $1.9 million dollars for the University.
The recessions are really difficult to deal with, he said, as universities and higher education institutions across the state also face budget cuts in the forthcoming year.
“We have already put all the money out to the units, and everybody thinks everything is okay, and then all of a sudden, we are saying everything is not okay, we are taking some money back,” Frank said. “As you can see, about 2.4 percent [was] out of our [infrastructure and government]. All universities (and) higher education institutions have that much taken from their budgets.”
Frank said since UNM is the biggest university in the state, which means is also has a big budget, it always faces risk of cuts in terms of dollars.
“We will be down by $7.9 million next year from where we have been. Unfortunately that is not the end of the bad news,” he said.
The increase in the cost of utilities, healthcare and power plants will further dent the UNM budget, Frank said, to the tune of $5.8 million.
Frank said the legislature has reserved the right to take out 1.2 percent from the next year’s budget if oil prices continue to go down.
“The cuts were done when oil was $26 a barrel and now oil is $32 a barrel. If the oil prices continue to go up towards higher 30s, we will be okay. But if the oil price plummets, we will be in trouble,” he said. “Analysts say that 2017 will be a variable year for oil cost. So it is really hard to predict where the oil prices will end up. In 2018, oil should stabilize.”
He said temporary solutions are not going to solve this problem, but that the University will continue its efforts for student success initiatives and will make principle-based decisions to overcome the impacts of these cuts.
“It is important that we must not step back on student success initiatives. We also believe that we need to prioritize student activities. We don’t intend to cut student TAs, GAs and those kinds of things that interact with students,” he said.
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Frank said he recognized that with a cut this big, there is going to be some pain.
“There is no way we can get through this without some dislocation and some difficulties. We are going to work on investment in student success. We need to grow our online degree. We will also continue our efforts to get a general obligation bond that comes out in November,” he said.
Frank said a mix of University-wide strategies and locally determined solutions are needed to deal with the problem.
Sally Barker, a public administration graduate student, said she could see an opportunity in the budget cuts for the University.
“I know we have to make cuts, but it seems to me that we actually have some opportunities here that we could leverage. We have students, and we have departments, that teach all sorts of things. It means that they can contribute so many things, if we could find a way to utilize these initiatives into revenue making fields,” Barker said.
Provost Chaouki Abdallah said that, keeping annual recession in mind, the University needs to add another $10 million in revenue.
“It’s tough in New Mexico. It’s tough everywhere. In [the] public higher education sphere everyone is facing the same problem. A lot of higher education institutions are exploring new avenues to increase their revenue to make [up] for the loss of funding from state and to make up for the pressure of tuition,” he said.
Sayyed Shah is the assistant news editor at the Daily Lobo. He can be contacted at assistant-news@dailylobo.com or on Twitter @mianfawadshah.
