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Release: March 5, 2002

Coleman explains how UI will deal with latest budget cut

Members of the University Community:

As you are no doubt aware, the State of Iowa continues to suffer significant budget difficulties. Faced with a deficit of $121 million in the current fiscal year, last week Governor Vilsack and the General Assembly agreed to take $44 million from the state's "rainy day" fund to cover a portion of the shortfall. To cover the rest of the shortfall, appropriations to state agencies, including the Regents universities, will be reduced.

For The University of Iowa, this means we will have to cut $4.98 million from our budgets in the remaining four months of FY02, including nearly $4.13 million from our General Education Fund. As you may recall, this comes on top of two other budget reductions to our state appropriations for FY02. With this additional cut, our state appropriations for this fiscal year will have been reduced by more than $37 million.

In consultation with the vice presidents and other University leaders, we have agreed on some general principles that will guide how we make these cuts in our budgets. They are as follows:

* We will not implement the furlough plan proposed in the Legislature. That plan would have required employees whose salaries are supported by state appropriations to take a day off without pay each month for the next 16 months. Fortunately, the Governor and legislators allowed us to find other ways to make budget cuts without imposing this inequitable plan.

* We will keep as many of our people working as possible and will not use layoffs unless absolutely necessary. Instead, we will make maximum use of attrition. We have already used this mechanism to eliminate 165 jobs.

* We will maintain the high quality of our academic programs by asking administrative units to again shoulder a larger burden of the budget reduction than academic units. Budget cuts assigned to administrative units will be 45 percent higher than cuts assigned to academic units.

* We will not reduce our student financial aid budget. This will help insure that all qualified students have access to a University of Iowa education.

* We will not cut our library acquisition funds. This will help insure that our students, faculty and staff will have as much access as possible to the tools they need to learn.

Unfortunately, the outlook for state revenues for the next fiscal year points to the need for further austerity measures. With that in mind, I am continuing to look for ways to manage our university in the most efficient way possible. To that end, I am today permanently eliminating the position of the Vice President for External Relations. As you may recall, for the past 20 months, Vice President for Research David Skorton has been serving as the interim Vice President for External Relations. With this change, his position will be renamed the Vice President for Research and External Relations. A number of senior leaders in his office will join Dr. Skorton in assuming additional duties. They are Bill Decker, associate vice president for research; David Wynes, assistant vice president for research; Mary Schott, assistant to the vice president; Steve Parrott, director of University Relations; and Linda Kettner and Lesanne Fliehler, assistant directors of University Relations. These individuals and many other excellent staff in the research and external relations units will work with our faculty, staff, and students to keep these critical aspects of our operations moving along smoothly and well.

I will keep you informed as we develop the details of our plans for addressing this latest FY02 budget reduction as well as our plans for FY03. Working together, we will find ways to maintain the quality of our educational enterprise and to weather these challenging times.

Thank you for your support, counsel and help.

Mary Sue Coleman