Governor Doyle announced Wednesday that the projected state budget deficit would exceed $5 billion through mid-2011. The projection, which had been estimated at closer to $3 billion in October, reflects a change in expected revenue.  State officials who had previously expected state revenue to increase by 1.5% through next June now say revenue will drop by 2.5%.  According to the Milwaukee Journal Sentinel and the Wisconsin State Journal, the Governor is now projecting, as part of the overall deficit, a $500 million shortfall for the current (2008-09) budget.

We are not pleased with this turnaround in revenues, but we are not surprised either.  As you may recall, we have anticipated an increase in the projected deficit and have already taken action as outlined in my campus-wide memos of 10/17/08 and 10/30/08.  I especially encourage you to review the budget forum PowerPoint presentation and discussion of Monday, October 27.

While more details regarding the budget deficit will be provided in a November 21 revenue projection report, the brutal fact is that Wisconsin, like many other states, is potentially facing its largest funding gap ever. Knowing this and the absence of more details is frustrating.  We would like to advance and complete the process of adjusting our budget planning scenarios immediately.  Instead, we need to be patient for many months and strongly advocate for the strategic importance of the role of our university in creating solutions that will lead to economic recovery and a more stable future for all Wisconsinites.

The good news, according to the Journal Sentinel press report, is that Governor Doyle said his top priority is funding education including UW Universities and that he will do all he can to avoid a crisis in the state educational institutions.  Nonetheless, the Governor made it clear that sacrifices, including spending reductions in all areas, are certain.

We will do all we can to create additional efficiencies. We must remind all internal and external stakeholders, however, that Wisconsin universities are already ranked among the “five most productive state systems … of higher education relative to their resources” (National Center for Higher Education Management Systems).  The UW System and its universities already have the lowest administrative costs in the nation.

As many of you know, while the Higher Learning Commission evaluation team lauded UW Oshkosh, they raised a serious concern regarding our all-too-thin administrative support — something unheard of in such reports.  We have also acknowledged our need to appoint more tenure-track faculty and we realize our classified staff has been hit hard by earlier budget cuts.  Much needed Growth Agenda funding was provided this year to help offset millions of dollars of earlier state funding cuts and to serve the recent and projected increase of more than 1,400 students.  While we may have to delay some of the Growth Agenda searches, we will do our best to protect our base funding.  It is obvious that we will have to continue to make tough budgetary planning decisions during six to nine months of budget planning uncertainty. 

Let me assure you that I realize how hard our faculty, academic staff, and classified staff have been working during consecutive years of serious economic challenges.  I have a hard time finding new words to express my deep appreciation and great admiration of our UW Oshkosh faculty, academic and classified staff.  As tough as it has been and will continue to be for us, more of our students and their families and friends are facing and will continue to face even more difficult challenges.  Let us continue to do everything we can to help our students while we adjust our budget planning sails so as to navigate the patch of uncertain and troubled waters ahead. 

As always, we will do everything possible to keep you informed and to solicit your views and recommendations. I have confidence that by working together we will find productive and practical solutions to the budget situation.