EKU Budget Information

2018 Updates

4/6/2018 | 3/26/2018 | 3/22/2018 | 1/17/2018 | Previous Years


April 6, 2018

Dear University Community:

As all of you know, these are challenging times – for higher education generally and for Eastern Kentucky University specifically. The combination of a continuing decline in state funding and increasing pension liabilities have created a perfect storm that is unprecedented in the history of this institution and our Commonwealth.
The Budget Advisory Committee, representing a cross-section of campus, began work several months ago to develop a strategic process and a plan whereby all areas of the University would share in a necessary $25 million budget reduction.

Key strategies included:

  • Increased revenue through new online bachelor’s degrees in Criminal Justice, Business Administration, Communication Studies and Sports Management.
  • Elimination of a vice president position and other administrative roles.
  • The move of Athletics to 2013-14 funding levels, in line with peer OVC institutions.
  • Closure of the regional campus in Danville.
  • Employee reduction: 96 filled positions, 57 vacant positions and 37 RTP-partial lines.
  • Academic program suspensions: 12 degree programs, two certificates, four minors and three concentrations.

Given our new fiscal realities, the University simply could not continue with a business-as-usual approach. After a thorough program review process, 12 degree programs, two certificates, four minors and three concentrations were recommended by the Provost and Deans’ Council for suspension or transition based on enrollment trends, graduation rates, potential for growth, and, in one case, changing professional requirements. All the suspended programs have a three-year and/or eight-year average degree production of less than 10 students, and when combined reflect an enrollment total in all programs of approximately 100 students, with the exception of the Associate Degree program in Nursing. In the case of the ASN program, which has been successful in the past, evolving degree requirements at hospitals have made strategic growth in the baccalaureate program a greater priority.

The Council on Academic Affairs (CAA) and Faculty Senate discussed in depth the proposed suspensions and transitions. My recommendations to the Board today followed the direction of CAA to retain the Theatre and Economics programs, and I additionally submitted the School Psychology degree program for consideration. You can read my full remarks to the Board here.

The Board approved the following academic programs for suspension or transition:

College Program Degree Recommendation
EDUC Deaf Studies BA Suspension2
(*The University will retain the BS in American Sign Language and English
Interpretation program.)
EDUC American Sign
Language Studies
MA Suspension2
HS Family & Consumer
Science Teaching
BS Suspension2
HS Nursing ASN Suspension2
HS Nursing
Administration
Concentration Suspension
HS PE and Health
Teaching
Concentration Suspension
CLASS Economics BA, Minor Suspension1,2
CLASS Religion Minor Suspension2
CLASS Theatre Cert (2), Minors (2) Suspension1,2
CLASS BFA-Sculpture Concentration Suspension2
Academic
Affairs
Individualized
Studies
BIS Suspension
BT Business &
Marketing Teaching
BS Transition: Business and Marketing Education/Teaching will become a
concentration under the BBA for General Business)
BT Risk Management
& Insurance
BS Transition: Students will transition to the BBA in Risk Management and
Insurance.
Science Chemistry BA Transition: Students will transition to the BS in Chemistry
Science Mathematics
Teaching
BS Transition: This program will become a concentration embedded under
the Mathematics BS program
Science Mathematical
Sciences
MS 2Transition: Students will transition to the MA in Applied Mathematics

1 These programs were not recommended for suspension by the Council on Academic Affairs at its meeting on March 29, 2018.
2 These programs were not recommended for suspension by the Faculty Senate at its meeting on April 2, 2018.

The Board decided to table until its next meeting any action on the School Psychology specialist degree program, which had been proposed for suspension.
Actions taken by our Board of Regents today represent a continuation of the program review initiated in 2016, and this process is vital to our academic mission as we must strategically allocate resources to programs to meet both student and industry demands.

If a program has been suspended, it does not mean that the University no longer values that academic field. Many programs will continue to be taught as subjects if no longer offered as majors/minors or incorporated into other programs. It is important to note that programs approved for suspension have a transition plan with teach-out options for any currently enrolled students. Some majors/minors will transition to similar degree programs with a different department structure.

Today’s reduction in personnel and loss of academic programs have made this process and this day among the most difficult experiences of my presidency. Just as with our academic programs, a reduction in personnel was unavoidable. The reduction of filled positions includes 60 staff and 36 faculty. Our HR Department will begin soon the process of notifying employees whose positions have been eliminated. It will be difficult to say goodbye to our valued colleagues. To help with their transition, employees in good standing will receive all designated benefits through their final employment date and receive a designated severance package to include a continuation of the EKU employee tuition waiver program.

In terms of percentage of unencumbered budget, Athletics is slated to make the biggest sacrifice, at nearly 22 percent, or $2 million, as it returns to the levels of 2013-14 in line with peer OVC institutions. The most significant change in Athletics is the elimination of our women’s and men’s tennis programs. These teams have excelled, and the student athletes and coaches have represented Eastern well. The University will honor any scholarship commitments should student-athletes on these teams choose to remain at EKU, or offer assistance for a successful transfer to another institution.
Remaining areas of the University contributed with reductions to unencumbered budgets ranging from 9 to 20 percent. To see the full breakdown of University-wide reductions, please refer to the budget advisory committee materials posted here.

Throughout this process, we prioritized academic excellence, our students and their success. As I hope you recall, we have committed to freezing tuition for the 2018-19 academic year. We recognize the great need to help our students finance their education and are willing to seek other strategies to balance our budget without increasing the burden on our students and their families.

We will do all we can to keep our students at EKU by offering options similar to their current programs. We are committed to helping the students currently enrolled at our Danville campus continue their education at Eastern. This includes advising and assistance to transition to another EKU campus or to an online degree program, at the same tuition rate they enjoyed while attending the Danville campus.

Also, I want to address a misconception that has surfaced about our budget reductions. It bears repeating that the actions taken today by our Board are in no way influenced by recently completed or ongoing major construction projects. The two new residence halls, the Eastern Scholar House, dining hall and parking garage were all financed by public-private partnerships, requiring no funding from the University. The new recreation center and renovations to the Powell Building are financed by a student fee, approved by the Student Senate in Spring 2015. These campus improvements will help us attract more of the best and brightest students, enhance their experience and help the University avoid rising maintenance costs to service aging buildings.

Many generations of students have benefited from “The Eastern Experience,” which is embodied in first-rate academic programs and services, a second-to-none faculty and staff, and a steadfast commitment to student success. As difficult as any budgetary reduction is for all of us, our aim is to emerge as an even stronger university, better positioned to serve the needs of our current and future students and an ever-changing society and workplace.

Thank you for your understanding and cooperation.
 
Yours sincerely,
 
Mike Benson
President

 


March 26, 2018

EKU Colleagues,
 
The 2018 academic program review proceeds this week with the important step of consideration by the Council on Academic Affairs (CAA) at a called meeting Thursday, March 29. The agenda and supporting materials evaluated by the CAA are posted here. As outlined by faculty-adopted policies, the EKU Faculty Senate is scheduled to consider the recommendations at its April 2 meeting. All recommendations/reviews will be submitted to the President for his consideration and to the Board of Regents for review and approval at its regular meeting on April 6.
 
Program review is an annual process, as called for in our Strategic Plan, to ensure relevance and quality of all academic programs and identify programs with high demand and capacity to grow enrollments. Additionally, the Deans conducted a scheduled follow-up of the 2016 review that addressed low enrollment, graduations and efficiencies. This year’s follow-up review coincided with the work of the Budget Advisory Committee (BAC). All academic programs recommended for suspension were proposed by the College and Provost as outlined in the strategy development process flowchart. Additional information on the BAC charge and process is available at budgetadvisory.eku.edu/.
 
The Provost and Deans’ Council used the 2016 program review list as a basis for reviewing degree production and enrollment in all academic programs. As a result of that review, 12 degree programs, 2 certificates, 4 minors, and 3 concentrations are recommended for suspension. All programs recommended for suspension have a 3-year and/or 8-year average degree production of less than 10, with the exception of the Associate Degree Nursing program (ASN)*. The Deans’ Council voted on and approved the suspension or transition of these programs:
eku program review
 
*The ASN degree program was identified by the College of Health Sciences as a strategic suspension as part of the budget and program review process. The Associate Degree program is and has been successful; however, in light of performance-based funding, the University is reducing stand-alone associate degree programs. College leadership has also indicated that strategic growth of the BSN program is a greater priority, and growth is limited in space and clinical placement opportunity by the continued offering of the ASN program. Additionally, most high acuity hospitals in the region require a bachelor’s degree upon or within two years of hire. In order to better meet those needs, an increased focus on growth of the Baccalaureate program will increase the number of nurses at the requisite degree level for long-term employment in area hospitals. 
 
One of EKU’s strategic priorities is academic excellence. During challenging budgetary times, we will remain attentive to preserving our excellent teaching and learning practices, supporting our faculty, and strategically assessing and aligning our academic program offerings to support our enrollment goals, our students’ career goals, and the overall economic health of Kentucky.
 
Best Regards,
 
Deborah Whitehouse, PhD
Interim Sr VP for Academics & Provost

March 22, 2018

Dear Colleagues:

Today, I bring you information about a serious budget scenario for our University.  As you may know, the total budget impact for Eastern Kentucky University is expected to land at approximately $25 million over Fiscal Years 2019-20.

Initial acknowledgment of the proposed cuts and pension obligations prompted me to appoint a Budget Advisory Committee to work with all University areas. The committee was charged to deliver strategic recommendations that would capture $25 million in savings.  The group has completed face-to-face meetings with stakeholders across campus and has compiled recommendations based on feedback from the campus community.

I thank the entire Budget Advisory Committee for its commitment to EKU, its acceptance of a difficult challenge, and its delivery of a comprehensive set of recommendations for consideration.

Understanding that this is a stressful process for University students, employees, alumni, and constituents, it is important that we share timely information when possible so that awareness of the committee’s work is relayed to the University community. Although deliberations of the recommendations continue, certain aspects of this report can be shared at this point in the process.

The following are the major components of our financial obligations addressed by the Budget Advisory Committee:

  • Increased KERS Obligation: $10 million
  • Expected KTRS Increase: $2-3 million
  • Mid-year FY 18: $650,000
  • FY 19-20: $4,060,769 (6.25%)
  • FY 19-20 Additional Cuts: $350,000
  • Decreased Tuition Revenue: $4-$6 million

For EKU to cope with obligations of this magnitude, there will be losses and long-term transformations. To meet our financial goal, the University simply cannot afford all the functions it has historically supported. EKU has no choice but to offer fewer programs, support limited activities and re-evaluate the structure of many areas at the University. While it is difficult to anticipate the evolving realities of today’s higher education landscape, the recommendations of the EKU Budget Advisory Committee equitably position us to meet our financial obligations and to continue supplying a vigorous educational experience to the citizens of the Commonwealth and beyond.

Strategic Budgeting Process

A recurring request during the committee’s work was assurance that all areas of campus participated in the budget process. I will address this in terms of percentages contributed to the overall financial goal charged to the committee. I believe this reaffirms that no one area will shoulder the load and that all areas of the University must share the burden to reach our financial objectives.

At this time, the recommendations yield approximately $25.1 million in cost savings across Fiscal Years 2019-20.

The breakdown by area in terms of the percentage of unencumbered budget reduction and dollar amount includes:

Area

% of Unencumbered

Budget

Strategy Total

Unencumbered Budget

Budget

Athletics

21.8%

$ 2,025,800

$ 9,310,472

$ 9,310,472

Regional Stewardship

20.0%

$ 1,681,556

$ 8,425,853

$ 9,388,908

Development and Alumni

14.9%

$ 460,322

$ 3,097,725

$ 3,097,725

Academic Affairs

12.4%

$13,223,550

$106,767,611

$125,306,998

Student Success

9.7%

$1,964,617

$ 20,244,484

$ 75,553,151

Finance and Administration

8.9%

$1,732,754

$ 19,476,876

$ 44,232,844

University

*

$4,055,535

 

$ 19,414,100

Total

15%

$25,144,132

 168,286,076

286,304,198 


*The “Strategy Total” for the University category represents strategies that were outside of individual VP areas. The amount yielded by these strategies is included in the table.

Primary Recommendations

EKU must remain a “School of Opportunity.” One of our proudest monikers is the status as Kentucky’s premier school of opportunity for students from all walks of life. More than 50 percent of EKU graduates are first-generation students, low-income students, or both. EKU is their launching pad to better lives for themselves, their families, and their communities. To continue providing this core service, we must do everything possible to acknowledge and preserve the “student experience” at EKU. This “student experience” includes both in-classroom and out-of-classroom activities that produce well rounded, critically thinking students. The strategies included in the committee’s report protect students to the greatest extent possible, including programs, scholarship and services.

Please understand that the details of these primary recommendations affect the jobs and livelihoods of EKU employees. I can only provide a general listing at this time. Details will be released after the Board’s final decision at its regular meeting on April 6.

At this time, primary recommendations include:

  • A reduction in force that affects filled positions, vacant positions, and RTP partial lines in both academic and administrative areas totaling approximately 200 positions
  • The elimination of upper-level Administrative and Academic roles
  • A reduction of funding for all of EKU Athletics to be consistent with the goals and level of our athletic programs within the Ohio Valley Conference and possible entire elimination of one or two non-revenue-generating sports teams.
  • Closure of the Danville regional campus
  • Academic Program suspensions as identified by Academic Affairs and evaluated by the Council on Academic Affairs and the EKU Faculty Senate
  • Review of downsizing, centralizing, and/or outsourcing options of University services
  • Increased revenue generation by creating new online offerings of high-demand EKU programs, including Criminal Justice, Business Administration, Communication Studies and Sport Management.

These recommendations touch every area of the institution, including Athletics, Academic Affairs, Student Success, Regional Stewardship, Finance and Administration, Development and Alumni Relations, and other University offices.

Next steps in the process will include:

  • Board of Regents review of these recommendations on April 6
  • Appointment of an implementation team that will work to ensure that the approved recommendations are put into effect and completed

Although every area feels the effects of this budget reduction, EKU’s commitment to educating students will not waver in spite of tough financial hardship. During tough times, it is important that we all work together to overcome challenges. I have witnessed the “Colonel Spirit” many times, and it is powerful. We must call upon our character and abilities to put the well-being of EKU first. The “School of Opportunity” has a wealth of outstanding programs, distinguished faculty and unmatched support services. And that is a winning recipe for the success of all students who knock on our door searching to better their lives through a quality education. We owe it to our co-workers and especially our students to emerge from this situation as a stronger force of good for our students, faculty, staff, alumni and the Commonwealth.

For more information about the Budget Advisory Committee’s work, visit http://budgetadvisory.eku.edu.

Thank you for your continued service.

Mike Benson
President


Budget Update - January 17, 2018

Dear Campus Community:

Last night Governor Matt Bevin revealed his biennial budget proposal and provided key insights into his priorities for Kentucky over the next two years. The Governor’s budget proposal is consistent with his promise to meet the escalating pension obligations that will now consume $3.31 billion during the budget cycle, representing nearly 15% of all General Fund spending.
 
To balance the budget, the Governor is recommending a 6.25% cut to most state agencies and the complete elimination of nearly 70 programs. These program cuts represent roughly $85 million in savings if enacted.

To address the funding issues facing the state, the Governor again called on legislators to tackle tax reform as soon as possible. He fundamentally believes that real and meaningful reforms will spur economic growth and provide a much-needed infusion of revenue needed to support the essential government services throughout the Commonwealth.

The direct impact of the 6.25% reduction on EKU will be approximately $5 million in our base appropriation for FY19 and FY20. This proposed cut is in addition to the 1.3% reduction, approximately $650,000, that the Governor announced in late December. In addition to this level of budget reductions, the proposed KERS rate increases were maintained at 84% for the biennium, and represent a $10 million increase in fixed and unavoidable costs. The net impact of these two areas represents approximately $15 million for our institution.
 
As it relates to the mandated programs that the Governor proposed to cut, I am happy to report that the budget preserves the funding for our Model Laboratory School. The Governor also proposed a $300 million bonding pool for deferred maintenance projects on our public university campuses. The pool requires a matching fund source, but this will give us the opportunity to address some of our critical facility maintenance issues on campus.
 
Another major policy issue we have been following and advocating for is the state-funded financial aid that provides more than $17 million in direct aid to our EKU students from the merit-based Kentucky Educational Excellence Scholarship (KEES) and need-based College Access Program (CAP) grant. The proposed budget fully funds these programs and helps support our students in their pursuit of a college degree. The positive impact of protecting these programs shows a real commitment to accessibility and affordability of higher education in Kentucky.

This is the first step in the budget process, and there will be many opportunities for us to work with legislative leaders to discuss the challenges and opportunities this budget proposal presents. There will be much debate, and we will work diligently to keep you informed during the process.

The EKU story is a powerful one, a story grounded in opportunity, personal transformation and service to one another. We proudly tell that story to anyone who will listen, and we will do everything we can to ensure that we will be telling that story to countless generations yet to come.

As we continue to work through our own budget process here on campus, I would ask that we do all we can to stay focused and serve our students to the best of our ability. Keep in mind that there will be a future, and in that future we will be the best version of EKU that we can be.

Thank you for all you do to support Eastern and our mission,

Michael T. Benson
President


Updates from Other Years

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