Greetings:

Their advocacy also helped get the Bell Museum project to the governor's desk for the second year in a row as part of a supplemental bonding package. While the Bell project did not make the final cut, the U received $25 million for building preservation and restoration as well as $2.5 million for a solar research lab.

When the 2009 session began, the state's $4.6 billion deficit made it clear that the U would have to prepare for financial challenges ahead. Still, the events of the last few days have created an increasingly difficult set of circumstances for the U. Legislative leaders and Governor Pawlenty did not reach agreement on which revenue sources to use to close a $3 billion deficit gap. The governor must now shift payments and unallot (cancel) state funding in order to bring the state's budget into balance for the next two years.

Last night, President Bruininks outlined the practical impacts of unallotment in an email to University faculty and staff:

• Make no mistake: the University is being cut substantially. We are facing a cut to our state budget base of 7 percent or $104M, with a likely additional unallotment that will take us to 13 percent or $178M. You'll likely hear smaller cuts quoted in the media--these quoted numbers are inaccurate, because they rely on federal stimulus dollars that disappear after 2010-11, leaving the University and the state facing a steep cliff in the next biennium. In other words, the quoted cuts are temporary; the real reduction is permanent.
• Federal stimulus dollars provide essential, but temporary, relief. We anticipate approximately $89M in federal stimulus funds to help us reduce the impact of these cuts during the next two years. By law, stimulus funds are dedicated for specific uses, including mitigating tuition increases, preserving jobs, and maintaining essential educational services. Approximately half of this money will go directly to financial support for students to help cushion the impact of projected tuition increases.
• Despite deep cuts, Minnesota students will be protected. Thanks to our new middle-income scholarship program, new federal stimulus grants, and newly expanded federal tax credits, under current tuition models, 60 percent of resident undergraduates will actually pay less next year than they paid this year--$1,000 to $2,900 less, depending on family income. The remaining Minnesota students (from families earning more than $160K each year) will experience an increase of just $300 in next year and $450 in 2010-11.
• The U is aggressively reducing its costs. Just five years ago, the University absorbed a cut of $185M or 15 percent to its state budget base. At that time, we had a number of tools available for managing these reductions, so that despite the cut, we were able to improve quality, productivity, and management at the University. We serve the same number of students now as we did then, and we have grown our sponsored research enterprise and kept pace with rising costs, all with flat or declining support from the state (in real dollars adjusted for inflation). We continue to reduce costs and increase efficiency--and, in fact, next year we will cut $94M in existing costs and reallocate those resources to current and emerging University priorities.