Although Ohio University President Roderick McDavis supported employee and faculty raises, his recommended budget proposes shifting $1.5 million in health care costs to employees.
McDavis, who was not available for comment, presented a budget for the 2008 fiscal year to the Budget Planning Council on Friday morning, reacting to Gov. Ted Strickland's proposed higher education compact. He will also take it to the April 19 meeting of the Board of Trustees' Finance Committee for approval.
The 15-member BPC, which is expected to fix OU's $8.55 million budget deficit, meets biweekly. BPC meetings, which are co-chaired by Provost Kathy Krendl and William Decatur, vice president for Finance and Administration, are not open to the public.
Under McDavis' new plan, employees would pay 18 to 19 percent of health care costs ' about a 2 to 3 percent increase ' compared to a 30 percent national average. University employees will receive a 3 percent merit-based raise on average.
BPC's proposal to keep health care costs the same was met with a split vote.
Not shifting any of the cost would lead to deeper cuts
Decatur said. Given the 3 percent and $1.2 million investments we felt this was the time to possibly change health care.
Administrative units would face an average reduction of 3.6 percent, while academic units would see average base budget cuts of 1.6 percent, the combination of which would free $4.8 million for reallocation.
Athens campus revenue is expected to increase $1.68 million, but costs are assumed to grow $10.23 million, leaving a budget deficit of $8.55 million. McDavis proposed a tuition increase last quarter to help offset the budget deficit, but Strickland's higher education compact calls for tuition freezes in exchange for additional state aid.
With Vision Ohio funds and reallocation we could close the budget gap entirely
Decatur said. But that would be without (increasing faculty compensation
financial aid and strategic investments). We're just not going to abandon those priorities.
McDavis also proposed a $2 million strategic investment pool to fund information technology efforts and minimum wage increases. BPC removed that from its tentative budget, Decatur said.
To strengthen the university's financial standing, McDavis also recommended investing $1 million into a rainy day fund.
We're not expecting any dramatic improvements in the budget landscape
Decatur said. We feel we should build up our reserves with the intention that we won't spend it unless it's raining.
The higher education compact, part of the state's budget, would increase OU's state funding by $3.7 million in exchange for freezing undergraduate tuition and fees. The state budget still needs to be approved by legislature.
One thing we can be sure of is changes
Decatur said. Unless something dramatic happens at the House and Senate
this is where President McDavis landed with regards to the budget.
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