June Budget Update

Colleagues,

State leaders and media outlets have reported a budget agreement in Carson City, and over the weekend, the Legislature passed many of the bills needed to implement the agreement.  While higher education fares better under this accord than under previous plans, there remain many difficult cuts we will need to face during the next two years. We are still learning the specifics of the agreement, and we’re finding that some issues remain undecided, but I want to let you know what we know at this time.

CSN and other institutions sought funding for the NSHE Four-Point Plan:  1) averaging budget cuts between fiscal years or “smoothing,” 2) tuition and fee increases of 13% in each fiscal year, 3) general fund restoration of $40 million each year to the system, and 4) institutional operating cuts.  We also supported the Regents’ request for equity funding.

Action from the money committees closed with a letter of intent that only allowed a single 13% overall fee increase instead of the 13% + 13% the system had brought forward.  This issue is still undecided.  Also undecided are issues related to retaining fees and other reforms NSHE institutions requested.

Other elements of the Four-Point Plan were adopted.  Cuts will be smoothed, $40 million in general funds will be restored each year to the system, and institutional operating cuts will be made at a reduced level.  CSN will also receive $1.5 million over the biennium to address equity issues.

Compensation cuts were also made, but at a reduced level.  Salaries for CSN employees will be reduced 2.5%, and six furlough days will be implemented in each year of the next biennium. It is our belief that this applies to classified and professional employees.  Anticipated changes in PEBP benefits will also be imposed.

CSN proposed to the Board of Regents and Legislature a plan to make program and access cuts, which will now be scaled back. We will, however, continue with our administrative consolidations and changes.  With the restoration of funds, CSN can continue its access mission, although at a reduced level.  CSN will continue to operate its learning centers at Palo Verde, Western and Green Valley high schools, in Mesquite, and at Nellis AFB.  The Henderson campus, once under discussion for possible closure, will also remain in full operation.  The Horn Theatre on the Cheyenne campus will remain operational as a community and teaching theatre.  Fewer vacant positions will be swept, and the budget will continue to provide equipment and library support.  CSN will still have a sizable budget cut affecting college operations and leading to the closure of the other sites and centers during the biennium. 

Clearly, the budget for the next biennium could have been much worse.  Two weeks ago the scenario for the budget was pretty dire.  Even with these improvements to the budget CSN will still operate at the lowest funding level per FTE in NSHE and among peer institutions, and reductions in compensation (salary and benefit levels) for our employees will severely handicap our ability to recruit and retain quality faculty and staff. 

I am increasingly concerned about the student “brain drain” in Nevada as more and more outstanding students leave our state to continue their education.  We’re losing gifted and able students to funding (i.e., state commitment to higher education) uncertainties.

Nevertheless, CSN will continue its mission in the next biennium to the fullest extent resources allow.

Mike

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