Message from the Provost

November 19, 2008

Dear colleagues,

This morning, State economists released their quarterly General Fund and Lottery revenue projections and, as expected, the forecast was lower than previous estimates. As a result, Governor Ted Kulongoski today directed the Department of Administrative Services to reduce agency spending to prevent the $140 million General Fund deficit. The Department is estimating the reduction will equate to about 1.2 percent of each agency's biennial budget. However, because there are only six months left in the biennium, the cut in each agency's state appropriation could be amplified in its impact. The Governor stated the reductions will be equally distributed among state agency appropriations.

The Oregon University System (OUS) is required to take an $8.8 million cut across the system, which is a reduction of 1.2% of the current 2007-2009 General Fund budget (not including debt service). This reduction will be shared by the campuses and the Chancellor's Office.

Before Thanksgiving, the Chancellor and the presidents will discuss campus budget reduction plans. OUS has indicated they will determine campus allocations of the reductions in early December once the Governor's budget is released.

The University of Oregon has recently taken steps through prudent fiscal management to address projected budget shortfalls. In October we announced a 0.75% or $1.4 million across-the-board budget reduction. It is unclear what additional steps will need to be taken, but the university will continue to aggressively manage this situation and remains well positioned to address these difficult economic times. It is our intention to continue to focus on instruction and student success as we develop our course of action.

In early December, the Governor will deliver his recommended budget for the 2009-11 biennium to the legislature. This budget will outline his plan for how the State of Oregon will manage this drop in revenue through the next biennium. The Governor's recommended budget will provide insight into how revenue shortfalls will impact higher education in the state over the next two years. The University of Oregon will continue to monitor these developments closely and we will communicate with faculty and staff as information becomes available.

During times of economic dislocation, higher education is more important to society than ever. Thanks to your continued hard work and commitment, University of Oregon students will continue to receive an outstanding academic experience.

Jim Bean