THE CHANCELLOR’S DESK: Weathering an Imperfect Storm

As the recession has deepened, the situation for public higher education has become more perilous. A recent report from the Center on Budget and Policy Priorities indicates that since 2008, at least 43 states have cut assistance to public colleges and universities and/or made large increases in tuition.

That’s why CUNY hosted a summit in November, co-sponsored by the University of California and Arizona State University and attended by public higher education system leaders from Oregon to Florida. Leaders discussed the many ways they are meeting the challenges of decreased funding and increased enrollment, including streamlining their business operations, increasing the use of academic technology, and ramping up private fundraising.

CUNY’s own challenges are clear. As we serve record numbers of students, we also continue to absorb cuts by both the state and city. The University’s senior colleges have now sustained over $205 million in state cuts since fiscal year 2009. In addition, all Tuition Assistance Program (TAP) awards are slated to be reduced by $75.

Our six community colleges have absorbed a combined operating budget loss of about $20 million. The city has proposed additional reductions of $13 million this year and $16 million next year.

The next few years will be even more challenging. New York State projects a deficit of about $8 billion in 2012, growing to $12 billion in 2013. New York City’s gap is more than $3 billion for 2012. Governor-elect Andrew Cuomo and his administration are preparing to address these fiscal realities, and we will work closely with them to maintain CUNY’s critical role as a workforce and research engine for the state.

A few years ago, when the financial storm clouds were developing, we began a complete examination of CUNY’s revenues, expenditures and regulations. We formed three working groups to find new savings and revenue opportunities:
• A budget working group is reviewing all revenues and expenditures to identify areas of potential consolidation and efficiencies.
• An asset review group is identifying revenue-generating opportunities among CUNY’s real estate assets.
• A regulatory reform group is examining any changes needed to bylaws, policies, laws and other requirements.

We will also continue to reinforce the use of the CUNY Compact as our financing vehicle. The Compact calls for a shared partnership among government, the University and its students, alumni and friends, with government covering the University’s mandatory costs. The Compact also includes a rational tuition policy, with modest, predictable tuition increases and the maintenance of financial aid.

Last year, the Board of Trustees approved a 2 percent tuition increase. It was not enacted, as the revenues were not included in our budget — which since then has been further reduced. As a consequence, we must prepare to raise tuition. Our aim is to spread the impact of the increase over two years. For spring 2011, we will request a revised tuition and fee schedule that includes a 5 percent increase for all programs. For fall 2011, we plan to include a 2 percent tuition increase in our budget request.

At the same time, we are calling for TAP awards to keep pace with tuition. The current TAP range is $500 to $5,000, and the award cannot exceed tuition charges. In addition, a portion of the tuition increase revenue should be returned to the University for investment purposes. If our students are asked to pay more in tuition, they should receive the benefits of their investment.

As we make these difficult financial decisions, it is more important than ever that we adhere to our guiding principles.

First, we have made significant gains in maximizing our productivity and efficiency, and we must continue to find ways to tighten our operations.

Second, we must protect jobs. We have made concerted efforts to hire talented faculty and staff, and sustaining them is critical to building a strong future for the University. We cannot make promises, but we will do everything we can to protect jobs.

Third, we must protect our core academic mission. Over the last several years, we have been increasing our academic standards, refining our assessment tools and enhancing our research capacity. Our students benefit from these efforts; the degrees they earn will serve them well in a competitive marketplace. We cannot let those gains slip.

I know that all of you are contributing to this effort every day — and I am deeply grateful for all of the ways you contribute to the success of our students and the University. With your help, we will emerge from this financial storm a stronger, forward-looking institution.