Texas is facing similar budget woes as Louisiana and that is having a negative impact on higher education. This articles addresses that and how UH is trying to cope with it. Just thought some of you might find this interesting reading.

I tried to attach a link to the article. When pasting this link, I can't tell if it is working or not, so I copied the article as well. If the link works, the site administrator can delete the lengthy article.

Budget woes force UH to weigh businesslike model

Budget woes force UH to weigh businesslike approach
Everything's on the table as school works to avert a budget meltdown
By JEANNIE KEVER
Copyright 2010 Houston Chronicle
Nov. 17, 2010, 10:09PM


Faced with the possibility of dramatic cuts in state funding, leaders of the state's two largest public universities are trying to change public attitudes, arguing that the state can't afford to cut higher education too deeply.

"We think higher education is a great public good," R. Bowen Loftin, president of Texas A&M University, said as he and the president of the University of Texas at Austin traveled the state this month to promote higher education as a long-term investment in the state's economy.

But leaders of the University of Houston said Wednesday they are also rethinking the way they do business as they face the prospect of huge budget shortfalls, a process that could lead to fewer classes being offered and the merger of some academic departments.

Faculty buyouts are on the table, as are automatic reviews to ensure that faculty members continue to pull their weight after earning tenure.

"We are trying to shift from an academic model to a business model," Renu Khator, president of UH and chancellor of the four-university system, said as regents discussed the gloomy economic forecast. "In the next 10 years, higher education will go through profound change."

The shift in Texas began more than a year ago, when all state agencies, including public colleges and universities, were asked to determine how they could return 5 percent of state funding for the 2010 and 2011 fiscal years. (The 2011 fiscal year started Sept. 1.) When state budget officials made the actual cuts, higher education had been disproportionately hit; although just 12.5 percent of the state budget goes to higher education, it accounted for 41 percent of the cuts.

Universities cut back on travel, streamlined purchasing and left staff positions vacant. When they were told to prepare to cut an additional 10 percent for 2012 and 2013 $29.6 million at UH, and about that much at UT-Austin - they cut deeper.

UT and A&M have been especially aggressive, laying off scores of staffers and instructors. Both schools also offered faculty buyouts, hoping to trim some highly paid professors from the payroll in order to save money in the long run. UH saved $1 million by requiring faculty and staff to take a one-day unpaid furlough, with additional unpaid days off possible in the future.

But now, a 10 percent cut would almost be welcomed as good news.

20-25% cuts coming?
With the state's expected budget shortfall predicted to reach as much as $25 billion, that could double.

"It doesn't look too good," said John Antel, an economist and the top academic officer at UH. "If I had to guess, I'd say 20, 25 percent."

Lt. Gov. David Dewhurst earlier this week suggested another 3 percent might be cut for the current fiscal year, although Carl Carlucci, executive vice chancellor for administration and finance at UH, said he isn't sure how that would be implemented.

He and other UH leaders undoubtedly will spend lots of time in Austin when the Legislature convenes in January, arguing their case, along with Loftin, UT President William Powers and officials from other schools. But the UH leaders signaled Wednesday that they are prepared to make permanent changes.

Projections showed that without significant changes, even if state appropriations remain level and tuition and fees go up 2 percent a year, UH would face a $105.7 million shortfall by 2021.

Other schools in the system would be in trouble, too: a $18.3 million shortfall at UH-Downtown, $20.8 million at UH-Clear Lake and $16.1 million at UH-Victoria.

"Higher education is going to have to make it more on its own," Antel said. He said he's met with faculty members to talk about ways to increase revenue, as well as cut expenses.

Making research pay
That will include trying to make more money off research done by university faculty. Raising tuition will be another option, but Carlucci said that depends on what happens with state funding, as well as what other schools do.

"It's clear we would like to limit increases," he said.

Dan Wells, a professor of biology and biochemistry and former president of the Faculty Senate at UH, said the group will survey faculty to see if there is interest in a program to encourage early retirements.

That might not save much money, Carlucci said, since someone would still have to teach classes.

For now, at UH and at universities across the state, plans to reinvent higher education continue.

Carol Robertson Ray, chairwoman of the board of regents, said the university will make whatever cuts are needed.

"We totally support the Legislature in the tough decisions they have to make," said Ray, who like all regents currently serving in the state was appointed by Gov. Rick Perry. "Our plan is to be ready to respond."

jeannie.kever@chron.com