No. 8, March 4, 2003

Crisis Over 1% Austerity Adjustment to FY '03 Amended Budget Averted

University System of Georgia officials were relieved Monday morning (March 3) when the Senate Appropriations Committee eased off on the additional 1 percent austerity adjustment proposed by its budget subcommittee last week for the Fiscal Year 2003 Amended Budget (see story below).

Instead, in signing off on its version of the budget, the Appropriations Committee reduced the size of the cut from $17 million to $3.2 million.

"I am gratified that committee members listened to our concerns and responded positively," said Chancellor Thomas C. Meredith. "Moving away from the additional $17 million reduction discussed last week for this fiscal year is vital, and I'm very glad to have this indication that they are doing so."

Here is a summary of the other changes to the FY '03 Amended Budget:

• Funds to cover the University System's share of health-care premium increases were eliminated (Gov. Sonny Perdue recommended $4 million for this purpose, and the House recommended $3.75 million);
• A $4.3 million austerity adjustment to the budget's "B" units was restored (the Governor recommended it, but the House reduced the amount of the reduction to $2.5 million specifically to help the Cooperative Extension Service and the Agricultural Experiment Station;
• A reduction of $516,250 for library construction in Telfair and Wheeler counties was restored (the Governor recommended it, and the House took it out);
• The Senate Appropriations Committee reduced by $10 million the amount of Major Repair and Rehabilitation (MRR ) funds allotted by the House, returning to the Governor's recommendation of $25 million for this purpose;
• $15 million in bonds for the redevelopment of the University of Georgia's Bio-containment Research Center was restored to the budget (the Governor recommended it, and the House took it out); and
• $18.4 million in bonds to finance four minor capital outlay projects (for Armstrong Atlantic State University, Southern Polytechnic State University, Georgia State University and Medical College of Georgia) was added to the budget.

The Senate Appropriations Committee will present the FY '03 Amended Budget to the full Senate for consideration on Thursday.

USG Presidents Help Chancellor Demonstrate System's Dire Situation

Responding to a Senate proposal to further reduce the University System of Georgia's Fiscal Year 2003 Amended Budget by 1 percent - $17 million - Chancellor Thomas C. Meredith on Thursday marshaled several campus presidents and other USG officials in an effort to forestall the move.

A large University System delegation that included the presidents of at least 15 colleges and universities crowded into a budget hearing conducted by the Senate Appropriations Committee on Thursday afternoon in support of the chancellor, who told legislators that the proposal could mean laying off more than 5,000 USG employees or shutting down all non-classroom facilities.

"One percent of our budget may not seem like a lot," Meredith said. "But - given that we've either already spent funds for the first eight months of the year or have committed dollars for the remaining four months - we're not talking about one percent of $1.5 billion." In fact, he said, the $17 million reduction represents about 25 percent of the budget that must get the University System to the start of the new fiscal year on July 1.

"We are no longer talking about careful budget surgery. We are talking about surgery with a chainsaw," Meredith said.

Earlier in the week, Senate budget writers unleashed a torrent of activity throughout the University System by releasing a draft version of the amended budget that would trim another $15 million from the University System's "A" (resident instruction) budget and another $2 million from the "B" budget. Together with proposed cuts to other state agencies, the proposal would save the state an additional $90 million over the next four months.

Invited to react to the proposal during Thursday's budget hearing, Meredith immediately alerted USG presidents and asked them to send him detailed information on the impact the cuts would have on their students and faculty for use in his address. He also asked them to join him at the hearing if possible.

"Let me walk you through what will happen on our campuses," he told the Senators. "It is not a pretty picture." Armed with the examples supplied by the presidents, the chancellor said the new cuts would have the following effects:

• The University of Georgia's work on the West Nile virus, bio-terrorism threats and agricultural water management would be put in jeopardy;
• Georgia Tech would put the Georgia Tech Regional Engineering Program on hold;
• The Medical College of Georgia's efforts to create a biomedical industry in the Augusta area would be put on hold - with short- and long-term negative impacts on the health of Georgians and on economic development;
• Macon State would find it's critical new campus to support Robins Air Force Base and defense contractors threatened;
• Valdosta State's service to 41 counties would be threatened; and
• Georgia Southern would cut its programs in Dublin, Brunswick, Hinesville and the Coastal Georgia Center in Savannah.

The Georgia Public Library Service is not exempt either, Meredith added, noting that the additional 1 percent reduction would bring their total cuts to public libraries for 2003 to 17.5 percent.

"Those libraries serving the most economically depressed areas of the state would be the most severely impacted, because they are the most dependent upon state funding for basic operations," he said.

"We have been partners in the cuts up to now," Meredith continued. "We have tried to help because the Governors of this state and the General Assembly have treated us fairly and equitably. Both have clearly recognized the value of this state's higher education system to Georgia's economic health and long-term success. When education is not protected in lieu of other areas, I'm afraid perspective has been lost.

"I don't believe the citizens of this state would agree with the choices that are being made at this point," the chancellor said. "To take apart this state's higher education system - a system admired by the rest of the nation, a system that is changing lives in Georgia on a daily basis - to take it apart as a matter of choice is beyond my understanding.

"For a state that ranks near the bottom of the nation with the percentage of its 18 to 24-year-olds in post-secondary education to consider reducing opportunities is absolutely unthinkable to me," Meredith said in wrapping up his remarks. He ended with a simple plea: "Please, no new cuts this fiscal year!"