The world wide economic crisis from which Tangipahoa has thus far been insulated, could soon be hitting the home front by way of a massive budget cut to Southeastern Louisiana University. This could seriously stall the economic engine of the parish.

 

Southeastern Louisiana University President Dr. John Crain put the proposed budget cuts in context by relating the brief history of what has brought about the current legislative debate that threatens to withhold major funding from the academic institution.

 

“We started the current fiscal year with a total operating budget of about $127.6 million, that includes the appropriation that we get from the State of Louisiana as well as the tuition and fees that we collect from our students,” Crain said.

 

In the middle of the fiscal year, the university suffered a $3.4 million cut in the funds provided through state appropriations as part of the mid-year budget cut to the University of Louisiana system. This cut was also expected to carry into the next fiscal year.

 

“In addition to the recent reductions that are being announced and discussed are additional reductions that are proposed in the Governor’s executive budget to the legislature and our part of that reduction is an additional $12.2 million,” he said. “So the total reduction of resources for us for next year is $15.6 million less money then we had at the beginning of the current fiscal year.”

 

Crain also stressed that this proposed budget, which would eliminate about 12 percent of the total operating budget and close to 20 percent of the state appropriation portion, is currently under discussion and the cuts would only surface for SLU if the budget passed “as is.”

 

If the proposed cuts do come to pass there is no question that harder times will befall the university and, consequently, the Tangipahoa Parish economic system.

 

“We have had to submit a plan that explains how we would go about meeting the $15.6 million reduction,” he said. “It’s really impossible to get to that level of reduction without pulling back funds from all different areas of the university. You really have to cut everybody to some extent.”

 

Crain revealed that, if the proposal passed through the legislature, Southeastern’s new budget would seek to preserve and protect the academic mission of the university at the expense of less critical programming. He elaborated on some of those possibilities.

 

“You reduce all that you can out of discretionary areas, things like; repairs, maintenance, acquisitions, reduction of operating services, travel, supplies, you really take money from every corner of the university to come up with that much money,” he said.

 

“We would have a number of positions that we would have to eliminate; many of those are vacant positions,” he added. “We’ve been holding positions vacant through a self-imposed hiring freeze since the mid-year cut was announced. We are fortunate to have accumulated some vacant positions that we would eliminate and that would help minimize the number of people who would actually have to be laid off.” 

 

Crain estimated that the job losses for the university would be as many as 80 to 90 faculty and staff, however many of those job cuts would be from the number of vacant positions that SLU has been accumulating.

 

In addition to these job cuts, there is reportedly a discussion about one to three-day furloughs per semester for employees of the university. This idea has the potential to save up to $1 million over the course of the year.

 

“You add all of those things up to get to $15.6 million in a fairly short period of time,” he said. “There’s really no individual academic department or program that we are proposing eliminating at this point. You really can’t close academic programs in the short run anyway because you have students and you have to let those students complete programs.” 

 

One of the problems that Crain says Southeastern is facing, if it could be called a problem, is that all of the degree programs and courses are fully enrolled, thus it would be very difficult to cut any of them. This is a dilemma that is not faced by all other schools in the UL system.

 

“If this budget challenge really becomes more of a long-term reduction in resources, then I think all of the universities will be reevaluating their mission and trying to figure out how they sustain programs on an ongoing basis at a lower level of funding,” he said.

 

One of the great benefits of Southeastern, the low student-teacher ratio, will also certainly be in jeopardy due to the cuts that will be inflicted on the university, should this budget be approved by the legislature.

 

“There is a good chance that there will be some courses that will have larger enrollment,” he said. “We’ll have some faculty positions we don’t fill, either that are vacant or maybe some of the people that we would not keep, so we would have to increase the size of some classes.”

 

He said there is also the possibility that some classes that are currently offered every semester would be reduced to less frequency, and less sections of classes when offered. This would have the potential of making class scheduling a hassle.

 

“There would be the potential for challenges for students to get courses that they need, we are going to try to minimize that,” he said. “If we have to implement a budget reduction of that level at such a large cut it’s going to have an impact on everybody.”

As for the possibility of raising revenues through raising prices, Crain said that Southeastern, along with the other colleges this cut would affect, are carefully considering their options.

 

In so doing, prices for auxiliary services such as housing, meals and other service fees would be investigated to see if the prices are set fair or should be raised to offset some of the revenue cuts the university could endure.

 

However, with regard to tuition, Crain said any rate hikes in that area have to be approved by the state legislature in accordance with the way the UL system is set up. There is no current plan to try to implement any additional tuition increases.

 

With regard to the employees that could potentially lose their jobs, such as faculty and staff, Crain said that it is not under the jurisdiction of the university to be able to give severance packages or any other type of unemployment benefits.

 

“We really do not have the latitude to do that under state law and under our board policies,” he said. “We do not have the latitude to make decisions like severance packages. That is something that the state might consider.”

 

One of the fine lines that the university would have to be very careful about is the way it would cut its marketing and recruiting efforts. These efforts are what ultimately bring a good deal of revenue to the pockets of the campus.

 

“We have to continue to do a certain amount of recruiting because enrollment drives revenue on the tuition and fee side,” he said. “If you completely cut the budget for your recruiting operation then you are going to lose enrollment and you are potentially going to lose more revenue than you saved by cutting that part of the budget.”

 

With regard to the community, Crain feels that there would be a significant impact on Hammond and the surrounding community economies as well. This sentiment is echoed by other parish officials.

 

“I think it is going to have an extremely bad effect on our parish,” Parish Councilman Carlos Notariano said. “Southeastern is this huge economic engine for our parish. Anytime any of its programs get cut it is going to have a negative effect on our economy.”

 

While Notariano does believe that the brunt of the economic impact would affect the Hammond and Ponchatoula areas the most, he does not rule out the possibility of effects reaching the mid-parish area or even further north.  

 

“Southeastern has an annual economic impact of about $565 million on this region of the state,” Crain said. “That reflects not just the money that the state gives us and the tuition fees that the students pay and the university spending that money in the local economy. It also reflects the money that our students spend.”

 

This large amount of funds also reportedly includes the impact that visitors to the campus have on the local economy, as well as special events.

 

“If you look at the trickle-down effect, if we have to do these budget cuts at this level, there would be a ripple effect through the local economy as you remove that much economic activity,” he said. “One of the things that would be noticed most quickly is a noticeable decrease in economic activity.”

 

In addition to this, many of the services such as; cultural outreach, school assistance projects and economic development programs will also be in jeopardy. There will be fewer of these activities in the new budget.

 

As for future forecasts, there is no way to know whether the budget cuts, if they proceed as proposed, would be temporary, or the beginning of a new way of life for Southeastern.

 

“When you get out two or three years we don’t know what the economy will be,” he added. “I think if the economy gets stronger then, of course, that could have an impact on the state budget. The question marks become a lot more significant the further out in the future you get.”

 

However, even with the dark clouds of budget cuts gathering on the horizon, Crain did point to a ray of sunshine.

 

“We’re still unsure as to what the exact outcome is going to be,” he said. “I think the legislature is going to have a lot of discussion and debate about the level of these cuts and I think that is healthy.”

 

So until the hammer comes down on the legislative session and the fog of debate makes way for a clear picture of Southeastern’s future, Crain’s attitude will be to wait and see what the future holds.

 

“I think it’s really important for us as a university to keep focused on our mission, continue to serve our students and work closely with the communities in this region of the state while the budget process unfolds,” he said.