Lee Todd on UK

This from UK President Lee Todd:

The University of Kentucky's budget for 2008-2009 will be very tough.

We face reduced state appropriations and increased costs, and we must handle those realities without massive tuition increases.The three percent recurring budget cut imposed by the Governor this year, combined with an additional three percent cut in our state appropriations for 2008-2009, means we will have $20 million less in state support next year.

In addition, our enrollment this year was lower than expected (primarily due to a decline in transfer students), resulting in fewer tuition dollars and less capacity to absorb cuts in state appropriations. We also anticipate a substantial increase in utility costs next year.

Finally, the economic outlook for the next couple of years in Kentucky and the rest of the U.S. is not promising.

Assuming this challenging financial environment does not change, we have begun making decisions about next year's budget.

* Our first responsibility is to keep costs for our students as low as possible, while maintaining the quality of their educational experience. I will recommend to the Board of Trustees at their April 22 meeting that tuition and mandatory fees increase nine percent for in-state students and 6.6 percent for out-of-state students for 2008-2009. This places an even greater burden on our students, but it is the smallest increase we can afford without severely compromising quality, and it still leaves us well short of the funds we need. Covering the entire reduction in state appropriations would require an 18 percent tuition and mandatory fee increase. That is simply too high. And it still would not cover increases in fixed costs, such as utilities.

A tuition forum will be held April 18.

* We will increase student financial aid to partially off-set the impact of the tuition increase.

* We have explored every avenue to increase salaries for faculty and staff, but the funds are simply not there. So UK's proposed budget will not include salary increases for faculty and staff (this does not include hospital system employees).

* To partially make up for the fact that salaries are not going up, the University will absorb all of the increase in employee health insurance premiums (UK HMO plans) next year.

These decisions still leave the University well short of the funds needed to maintain spending at the original 2007-2008 level. I therefore have directed the Provost and Executive Vice President for Finance and Administration to begin working with the deans and other senior administrators to implement a $14 million reduction in the University's budget. We intend to give maximum flexibility to the colleges and operational units to absorb their share of these reductions.

We all want a healthier budget, with lower tuition and an increase in salaries. But this tough budget does not change our responsibilities to the people of Kentucky. We owe it to them to give it our very best, regardless of the budget conditions we face.

They still need their flagship university to be affordable. They still need their statewide research university to be dedicated to fighting disease, creating businesses and jobs, and improving lives. They still need their land-grant university to reach out to every community and every family in our state. And they still need their University of Kentucky to aim to be among the Top 20 in the United States.

It will take our individual and collective best to work with this imperfect budget and continue to make progress on top priorities. I am confident in the goodwill and resilience of the University of Kentucky community.

SOURCE: Campus-wide email