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Jana Hollingsworth, Forum News Service, Published February 18 2014

University of Minnesota Duluth looks to cut nearly $12 million

DULUTH, Minn. – The University of Minnesota Duluth will announce next week more concrete plans on how it expects to reduce $11.9 million from its budget.

Reductions in state funding, decreased tuition revenue and an unexpected fringe benefit shortfall led to the deficit, and in recent months, UMD has been studying ways to make cuts and raise and save money through a campuswide process that has caused tension among many employees who are worried about the outcome.

“There is very little hope among the faculty,” said Steve Matthews, vice chairman of a new faculty council created under Chancellor Lendley Black. “There is some sense that there is intent to do the right thing. But we are losing good people, and we will lose more. If we can’t field competitive and cutting-edge programs, then the students have every right to go someplace else.”

A proposal created via “program prioritization” examined all areas of the campus and recommends seven pages of possible cuts, savings and revenue sources. It lacks specifics in the area of academics and in dollar figures, but Black said those are forthcoming.

“It’s clear we will do business differently as a result of this,” he said, but many of the proposed items won’t come to fruition.

Examples of possible changes include:

E Charging a semester fee to students for use of the Duluth Transit Authority. It is currently free.

E Eliminating several positions within operations, including some Teamsters and supervisors.

E Eliminating the advancement administrative unit.

E Reducing the number of elective courses, with a focus on classes with smaller enrollments.

UMD also offered a voluntary layoff program for staff, not faculty. The outcome of those savings will be announced next week.

The changes, Black said, will make UMD a stronger campus.

Enrollment drops

A large part of UMD’s problem has been its dependence on tuition. In 1998, 40 percent of its revenue came from tuition; in 2013 it was 77 percent. When enrollment increased at UMD, the University of Minnesota decreased UMD’s portion of state funding. The state decreased its funding for the University of Minnesota system by $140 million.

From 2009 to 2013, UMD’s unrestricted portion of that money declined by 41.6 percent. Comparing that to the Twin Cities campus, Duluth received a much smaller percentage. University officials have said it’s an unfair comparison because some state money in the Twin Cities budget is spent elsewhere in the state, for example.

“You stubbed your toe on undergraduate enrollment a couple of years ago, and that has cost you continuing ongoing tuition revenue, so you have sort of a perfect storm,” University of Minnesota President Eric Kaler told UMD faculty in a Monday meeting on campus.

Since fall 2011, enrollment has dropped by more than 550 students. Total enrollment this fall was 11,241, but a 9 percent increase in new students is projected for next year. UMD lost $5.4 million in tuition revenue in the past two years.

Kaler and other administrators from the Twin Cities were in town meeting with UMD officials, staff and students, with the intention of addressing budget concerns. Many faculty members at the meeting asked that more costs be shared by the Twin Cities campus, and that cuts not be made to academic departments. Some said they felt there was a regional bias against Duluth, that decisions were often made in the Twin Cities that affect the Duluth campus and that money wasn’t always fairly shared.

There’s no bias in financial decisions, Kaler said.

“The Twin Cities to Duluth competition, I think, is in our DNA at some level,” he said, referencing how it plays out in hockey games between the two schools. “We are interested in this being an excellent university system and this being a strong campus … we’re not in the process of crippling the campus.”

Jennifer Schultz, an associate professor in the economics department, said she understood there were differences between the Twin Cities campus and UMD but questioned why the Morris campus experienced a much smaller reduction in state funding than UMD over the same period of time, noting the large amount of research UMD produces.

Kaler said the university system had a commitment to keeping a small rural campus in Morris, and that was an expensive undertaking.

“It goes right to the heart of different missions of institutions,” he said.

Maureen O’Brien, head of the economics department, said as UMD becomes leaner, it looks as if its focus is narrowing to technical areas.

“We need the artists and musicians to inspire us. We need the historians to give us context and perspective,” she said. “We are missing out on the meaning of a university education.”

UMD culture

The rumor mill churns with possible academic program mergers and eliminations, said Matthews, head of the history department. He called for more transparency.

“We find out more in the hallway” than from administrators, he said. “We all want this place to work. But we don’t even know what type of crisis we’re facing.”

Faculty members are worried about having enough resources to do their jobs well, he said, and ensure that student success isn’t affected.

While morale is low, said Michael Pfau, president of the University Education Association at UMD, employees appreciate the culture Black has created in his nearly five years as chancellor that allows the freedom to speak out about it.

In the past, he said, most would have remained silent.

“We are adjusting to culture shifts at UMD, which are good and challenging,” Black said. “As soon as you make things more open, people want more (openness) … my goal is to continue to be as open with the campus as possible and deal with the anxiety they are feeling as much as I can.”