Iowa State University
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News Service

News Service:

Annette Hacker, director,
(515) 294-3720

Office: (515) 294-4777

05-04-06

Contacts:

Gregory Geoffroy, President, (515) 294-2042

John McCarroll, University Relations (515) 294-6136

Geoffroy comments on state budget

(President Gregory Geoffroy sent the following letter to Iowa State faculty and staff on May 4.)

To the faculty and staff of Iowa State University:

The Iowa General Assembly has finally passed an FY 2007 budget with funding for the Regent institutions, and I am writing to explain what it means for Iowa State. Keep in mind that the Regents had requested a base increase of $40 million ($16 million for ISU) that would be used to fund the ongoing operating costs of the universities. In return, the Regents agreed to hold the tuition increase to 4 percent.

Although this budget may be portrayed as fully funding the Regents' request by providing $40 million in new funds, in reality it falls far short since only $11 million is for an actual increase to the general operating budgets of the Regent universities. All of the remaining $29 million for the Regents is in the form of one-time, non-recurring funds, and $20 million of that is directed solely to economic development initiatives, of which Iowa State's share is $11.6 million. While those one-time funds are certainly appreciated, none can be used to cover the recurring operating costs of the university.

In addition to those funds, the final budget includes $5 million in planning money for an addition to Gilman Hall, $2 million in one-time facilities funding for Veterinary Medicine, and a $1 million operating increase for the Veterinary Diagnostic Laboratory.

Of the $11 million in recurring funds, Iowa State will receive $4.4 million, a 1.86 percent increase to this year's recurring appropriation. This is the only new money we will receive in state appropriations to support the core mission of the university and our recurring costs. This level of funding will severely limit the level of compensation increases we can give our employees and the availability of funds for other recurring cost increases, including our very large increases in utility costs. Some of those costs will be covered with the one-time funding described above, but that only defers funding of those recurring costs to future years.

With this level of recurring state appropriations, we will be able to distribute to units salary increase funds that correspond to 2.5 percent of the salary base for faculty and P&S staff. We will encourage units, as they are able, to reallocate funds internally to achieve an average salary increase level of 3 percent or higher and to be sensitive to the overall increased cost of living. Units will also be requested to give special attention to market competitiveness for P&S staff, and we will establish a pool of $1 million of additional salary increase funds for the Provost to use to address particular issues of faculty salary competitiveness. This level of salary increase allocation will require selective budget cuts to be identified next fiscal year in order to bring our future budgets into balance.

This very small state appropriations increase to our base operating budget is extremely disappointing. The 1.86 percent increase is substantially below the rate of inflation, and it is significantly below the 4 percent funding increase given to Iowa's community colleges and to Iowa's private colleges, through the private college tuition grants program. It is just one more sign of the steady erosion of state funding for Iowa's public universities, a trend that shows no sign of abating.

Our recurring state funding now stands at the level it was for the 1997-98 budget year, without considering inflationary costs. This budget sends a strong message from our state leaders that they expect an increasing share of the cost of operating Iowa's public universities to be borne by our students, through increased tuition.

It is important that all those who care about public higher education continue to communicate to our elected leaders and to the people of Iowa our concerns over this erosion of public support for Iowa's universities and how essential it is that we have adequate funding so that we don't slip into mediocrity.

I appreciate your patience and understanding as we work through this budget process. And I want to emphasize that while the budget outlook is disappointing, it should not overshadow what has been a very good year for Iowa State, and I want to thank everyone for your good efforts in making it so successful.

Sincerely,
Gregory L. Geoffroy
President

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Quick look

President Gregory Geoffroy says the state appropriations increase to Iowa State's base operating budget is "extremely disappointing."

Quote

"It is important that all those who care about public higher education continue to communicate to our elected leaders and to the people of Iowa our concerns over this erosion of public support for Iowa's universities and how essential it is that we have adequate funding so that we don't slip into mediocrity."

President Gregory Geoffroy