To: VSU Budget Administrators
From: Ronald M. Zaccari, President
RE: Decreased State Revenues
Date: March 18, 2008
On March 10, 2008, Georgia state agencies received notice from the Office of Planning and Budget to “curtail discretionary spending” and advised all agencies to (1) restrict hiring for non-critical positions and (2) reduce discretionary expenditures for travel, contracts and other areas to limit spending.
The recent slowdown in Georgia’s economy and overall state revenue collection has established a trend that may prove to be insufficient to meet the Amended FY08 budget as well as the FY09 original budget. In preparation for the declining revenue collection, the state is adjusting its FY08 Amended Budget revenue estimates by approximately $65 million. Further, the USG received the following recommendations for reduction in the FY09 Original Budget:
- Reduce salary increase from 2.5% to 2%
- Transfer cash funding for MRR of $35 Million to bonds
- Reduce funding recommended for materials and books by $1M
- Reduce funding for PINES library network, $579,714
- Reduce funding for Other Post Employment Benefits (OPEB) for Regents’ Retiree Health Benefit Fund, $14.4M
- Reduce funding recommended for infrastructure needs at UGA-Griffin campus, $800K
When I arrived at VSU in 2002, the State of Georgia was beginning a three-year reduction in revenue collections in which VSU suffered more than $8.2 million in permanent budget reductions. During those three years, the campus demonstrated a spirit of cooperation well beyond any I had experienced in many years of higher education management. Through the strategic budgeting process, VSU was able to add 41 new faculty positions and move identified strategic initiatives to implementation. I once again request that you work closely with assigned budgets and follow the current mandates that have been communicated to all units within the University System of Georgia.
The Budget Advisory Council (BAC) has developed an integrated budgeting system that allows administrators to connect budget priorities with the institution’s strategic goals, which are linked to the System’s Goals. Through this strategic process, we have enhanced efficiencies in our daily operation without eliminating direct services to our students.
Each USG institution has been instructed to restrict expenditures and quantify savings and prepare additional measures should state revenue trends indicate the need for future reductions.
The Budget Advisory Council has therefore recommended, and I have approved the immediate implementation of the following measures to address the request for curtailed spending:
Restrict hiring to critical positions. All requests to fill vacant or new positions will be reviewed and approved by the Budget Advisory Council prior to posting. Requests will be approved based on the critical needs of the university. Completion of the second page of the Position Management Form (PMF) is especially important during this critical budget review process. Additional documentation may also be submitted in support of the request. PMF’s will be reviewed in the order in which they are received on a weekly basis and decisions communicated immediately following the BAC review. PMF’s that are not approved will be retained by Human Resources and Employee Development for future posting when the current restrictions are lifted.
Reduce discretionary expenditures in travel, contracts, and other appropriate areas. Each budget manager must restrict travel and other expenditures to those determined as essential. In this context, essential is defined to mean “that without which one is unable to complete their stated job requirements”. Individual budget managers must retain documentation of all “savings” and be prepared to forward that documentation to the Budget Advisory Council upon request. Page 3 outlines a format to be used to document items that were not approved for funding as well as other savings generated from this point forward. The form on page 3 may be found in Excel format on the Financial Services website.
I know you will work in harmony with me and remain focused on VSU’s daily operating expenditures. I am extremely proud of your previous protection of scarce financial resources and expect to observe the VSU spirit of cooperation standing above the nation’s higher education landscape.