Illinois economy leaves University few options
November 20, 2009
Illinois’ economic downturn has led some faculty to worry about the possibility of furloughs.
Jessen Hobson, assistant professor in accountancy, said he preferred that the University did not resort to using furloughs.
“I know that it’s an issue that’s plaguing many different universities, especially with the financial problems that are happening throughout the nation,” Hobson added.
A furlough is a leave of absence given to a faculty member without pay or at reduced pay.
Despite the state owing $317 million to the University’s Urbana, Springfield and Chicago campuses, President B. Joseph White decided to not implement furloughs before Jan. 1, said Randy Kangas, associate vice president for the University Office of Planning and Budgeting.
“We work with the state regularly on cash flow, but this is the most severe cash flow problem I’ve ever seen,” Kangas said. “We’re planning for the worst but hoping for the best.”
The state is asking the University to cover all of the costs through its own funds, said Mike Andrechak, associate provost for the University Budgets and Resource Planning Office.
“At some point you run out of the tuition income. I think it will be very challenging in December and early January,” Andrechak said.
The University’s money is just a part of the state’s $4 billion backlog, said Carol Knowles, spokeswoman for Illinois Comptroller Dan Hynes.
“The state has less revenue than expected and is unable to pay every bill,” Knowles said. ”We are limited in what we can do with the funds available.”
The University bills the state throughout the year, Andrechak added.
“They (the state) provide an appropriation for the Urbana campus of about $250 million. We cover some of our costs from tuition and some from state appropriation,” he said.
He used payroll charges as an example.
“We bundle all of our payroll charges together and either send it to the state or pay it locally from tuition income,” he said. “So, any faculty member could be paid from one source or the other.”
Kangas said universities are continuing to monitor the financial situation.
“We (the University) are holding back spending as much as possible. We have building repair and maintenance on hold,” Kangas said.
Andrechak said the University has an emergency fund set aside to help it move through the situation.
“We’ve also told the campus not to hire unless absolutely necessary,” he added.
He said the state was late on its payments last year, and the University took five to six months collecting its final bills.
“We are expecting the state to pay at some point. It’s just a matter of getting by until they do,” Andrechak added.