Correction appended. See below.
While the national government is taking measures to deal with the recent economic crisis, state governments are also forced to deal with the issues. The state of New York has a huge budget deficit, according to The Wall Street Journal, that Gov. David Paterson (D) and the state legislature are being forced to deal with.
In order to minimize the deficit, the state has to limit its funding to different institutions including schools. According to The Ithaca Journal, the state will force the State University of New York (SUNY) to absorb an estimated $70 to $96.3 million of the losses and Cornell will feel the effects of the cuts.
Some of the steps many universities will be forced to take to decrease their costs include reducing admissions, increasing tuition, limiting faculty positions, offering fewer classes and increasing the amount of students per class.
According to Ron Seeber, vice provost for land grant affairs, the University is bracing itself for a cumulative state cut of $7.5 to $10 million. However, Seeber stressed this is just an estimate, and said they will not receive the actual numbers until after the election on Nov. 4.
“It could get much worse,” Seeber warned about the current estimate. “There could be another round of cuts.”
In the meantime, the University is taking a general look at “how we do business,” Vice President of University Communications Tommy Bruce said.
Bruce explained that Cornell is not in a dire financial situation, and therefore is going through the regular procedures to examine where money can be saved. They are not forming any new committees, but rather using the already established budget committees to see if there are areas where costs can be contained and if there are places where money can be saved.
“[The financial situation] requires we be very diligent in reviewing all our strategies,” Bruce said. While all sections of the University are looking at their financial practices, plans are being made to prepare for the state cuts that will specifically affect the four land-grant schools: the College of Agriculture and Life Sciences, the College of Human Ecology, the College of Industrial and Labor Relations and the College of Veterinary Medicine.
“We’ve left it to the deans there to develop plans,” Seeber said.
Vet School Dean Michael Kotlikoff has been planning for the cuts, but he explained some of the difficulty in using standard, typical means for conserving funds.
“[The College of Veterinary Medicine] is in a particularly difficult situation because our total student number is relatively small,” Kotlikoff stated in an e-mail. “Unlike many SUNY colleges we cannot significantly offset [New York] state reductions with tuition increases. Moreover, tuition costs are already very high relative to veterinary salaries.”
Kotlikoff also explained the complexity in planning at this stage because the college still does not know exactly what kind of fiscal figures it is going to have to deal with. While they are currently preparing for cuts of up to $10 million, the actual figures could be worse.
“One of the major uncertainties is how extensive the state cuts will be, as there is the possibility of additional cuts this fiscal year,” Kotlikoff stated in the e-mail. “These latter cuts will be particularly difficult coming on top of previous reductions and occurring late in the fiscal year.”
Not only will a decrease in state funding hamper the different universities, but to further save money, the state has reduced contracts for certain programs with the universities that it can no longer afford to maintain.
Kotlikoff explained that the state has reduced its contract with the Vet School’s Animal Health Diagnostic Center, which will reduce its activities and severely limit the services that it provides.
“We have asked every financial unit in the college to meet targeted reductions and allowed them to prioritize programs to meet these cuts,” Kotlikoff said in the e-mail. “We have also eliminated several positions and have required central approval before going forward in filling vacant or new positions.”
In terms of financial aid, Doris Davis, associate provost for admissions and enrollment, stressed Cornell’s history and dedication to providing an affordable education to those from all social classes.
Alterations to the financial aid program began last year where Cornell eliminated loans to students who’s family incomes are less than $60,000, and capped loans at $3,000 for those students who’s families make between $60,000-$120,000.
Further changes will begin in the fall of 2009. The minimum family income to qualify for financial aid will be increased to $75,000, and the $3,000 cap will be for families with an income between $75,000 and $120,000.
“This new financial aid initiative enhanced the financial aid programs that Cornell already had in place for students and parents, and Cornell has pledged to raise additional funds for financial aid during the current campaign,” Davis stated in an e-mail.
With uncertainty about the amount of money that will be cut, the University is making the necessary preparations. But despite the planning, there is no avoiding the inevitable repercussions of a decrease in funds.
“I am very worried that if the already announced cuts are followed by additional in year reductions and further reductions next year, [the cuts] will seriously erode the quality and stature of programs that we have built up over many years,” Kotlikoff added. “The College [of Veterinary Medicine] enjoys a well-earned reputation as the preeminent veterinary college based on the aggregate strength of our clinical, diagnostic, research and outreach programs. While we leverage State support enormously, decreases in funding of this magnitude will cut into our core strengths significantly.”
This article incorrectly stated that “The minimum family income to qualify for financial aid will be increased to $75,000.” Rather, the financial aid initiative announced earlier this year will eliminate need-based loans for all undergraduate students from families with income under $75,000. The initiative will cap annual need-based loans at $3,000 for undergraduate students from families with incomes between $75,000 and $120,000.