Budget and financial matters are occupying much of our attention right now, with this year’s campus budget-allocation process nearing completion and legislative approval last week of a 2013-14 New York State budget.

In addition, last week, we responded to a series of thoughtful questions from the Budget, Goals, and Plans Committee about the campus budget – many prompted by your responses to the committee’s survey about the budget last spring.  Because our responses may be of broad interest beyond this year’s budget process, we have posted them in the Budget Information Center in my.newpaltz.edu and have attached them here. We encourage you to read the questions and our responses, as we believe they will help you understand important detail and complexity about our budgetary considerations and decision-making.

State budget. We expect to receive more detail in the coming days about the impact of the new state budget on our campus. The limited communication from SUNY administration since the budget passed tells us that there is still significant discussion about system-level decisions surrounding the budget and its implementation.  We will apprise you of further information as it becomes available.

We are fairly certain of the following (some paralleling the assessment you received over the weekend from SUNY Faculty Senate):

Tuition.  It looks like the next year of tuition increase ($300 for resident undergraduate students) has been approved.  This is the core of the new revenue that lets us even consider funding new faculty positions, support positions, and other initiatives – brought forward in this year’s budget requests.  We feel a strong obligation to include increased financial aid for students given the tuition increase.

State taxpayer support.  State taxpayer support to SUNY state-operated campuses such as New Paltz is expected to be flat; we believe at this time that the SUNY request for the state to fund contractual salary increases was not included in the state budget. The good news about flat taxpayer support is that we are not being cut, as we were in recent memory.  The downside is that any inflationary or contractual increases (e.g., regular inflation, multi-year software packages or service agreements with built-in inflation adjustments, collective bargaining agreements) must be funded from campus resources, most likely by allocating new tuition revenue for this purpose.  The multi-year increase in minimum hourly wage affects our student employment budgets, but we expect that impact to be modest; we intend to allocate funds to sustain both student financial support and departmental reliance on student labor.

SUNY hospitals. It is now virtually certain that sustaining SUNY hospitals, facilities and programs will impact all SUNY state-operated campuses; these programs are critical in educating health-care professionals in New York and in providing affordable health care to many New Yorkers.  SUNY and the State are working to develop a new financial model for Downstate Medical and its affiliated hospitals. While we hope that impacts on other state-operated campus budgets will be short-term, the impacts will be significant.

It is not clear whether campuses will contribute to this “bailout” through campus reserves, or through use of salary savings in the Deficit Reduction Leave (DRL) program.  Either way, planning for these financial impacts introduces a significant note of caution into our thinking about allocating new tuition revenue – again, our only clear source of new recurring revenue for new positions or initiatives.   Salary monies held back through the DRL will eventually be re-paid to employees. We will work hard to convince our legislators to allocate new funds for that purpose, if this is the source of funds used for campus contributions to keep SUNY medical schools/hospitals financially afloat.  But we cannot count on that investment, and we would be irresponsible to ignore this possible near-future commitment as we think about decisions to allocate new revenues for the coming year.

As explained in our memo to the Budget, Goals, and Plans Committee, our campus “reserves” or cash balances at the end of the year will be somewhat below the mid-point of the range directed by SUNY policy – sound, but not excessive.  Being required to use campus reserves to contribute to the hospitals would introduce a different set of financial concerns – how to ensure that we have set-aside sufficient funds for future emergencies or key opportunities.  In any event, our contribution to the Downstate Medical financial solution will clearly have an impact on our campus finances and planning.

Capital funding.  We do not know the final outcome of capital-funding decisions, but there was no cause for optimism leading up to the final budget.  It appears that the new state budget has no funding for new capital initiatives or deferred maintenance for New Paltz and most other campuses (again, bonding authority is in place for the new science building and the library renovation), and we are deeply concerned about losing significant ground on our critical maintenance initiatives.  We have no word on whether the “disbursement cap” limits that have delayed the new science building construction and the library renovation have been lifted.

The one bright spot on the capital side is the apparent decision to remove residence hall construction and renovation from the state bonding caps.  While we await final word on whether the authorization limits include both construction of a new residence hall and renovation of Lefevre Hall, we continue to plan both projects.

Campus budget process.  In the meantime, Cabinet is prioritizing requests for new funding. We want to be poised to finalize budget-allocation decisions as soon as our financial situation for next year and the following years is clear. We are planning a campus-wide budget forum on April 24 to share these priorities (details to follow).

Again, please stay tuned for updates in the next weeks.

Donald P. Christian, President
Michele Halstead, Assistant Vice President for Administration and Finance