The University of Montana has shrunk a $10 million shortfall, and with prudent spending, the flagship may not need to dip as deeply into reserves as planned this fiscal year.
Paul Lasiter, vice president of operations and finance, said he projects UM will close out the 2019 fiscal year in better shape than projected if the campus continues to spend with caution.
He had planned to spend $7.3 million in savings to cover basic operating costs, but he believes the budget is "almost at break-even." However, Lasiter also said the budget is lean for the needs of the campus.
"We've reached a point of stability, but I'm not satisfied," Lasiter said Friday. "That budget needs to be much more robust."
In January 2018, incoming President Seth Bodnar identified UM's budget shortfall at roughly $10 million after years of declining enrollment, and he outlined a plan to get on track over the course of four years. Last fall, an interim finance vice president projected the campus would close roughly half of the gap.
The fiscal year ends June 30, and Lasiter shared an update of the budget picture as UM wraps up the year. The general fund put total expenses at $146.9 million and revenue — not including savings — at $139.6 million.
But Lasiter anticipates revenue will be up $3.7 million more than estimated, and expenses will be down as much as $4 million based on spending patterns the last several years. (Lasiter, who stepped into the role in January, said he can't yet see which areas that $4 million is coming from, but he's going to update the reporting system to be able to see more deeply into the budget.)
UM has reached stability for the short term, but Lasiter said the budget needs to grow. For instance, the enrollment vice president needs more money to recruit students, and the Facilities and Services director needs money for campus maintenance.
"The revenue that we're generating right now is sufficient to cover the bare minimum of costs that we must incur," Lasiter said.
Matt Semanoff, outgoing chair of the Faculty Senate, said he is generally encouraged about the financial picture for the overall institution, but the difficult work isn't done.
"There's reason to be cautiously optimistic, but I think it's going to take a while to recover," Semanoff said.
For example, he said individual departments are still having challenging discussions about how to achieve budget targets even in the 2021 fiscal year, and faculty see positions not being renewed.
In his own Modern and Classical Languages and Literatures department, Semanoff said an outgoing faculty member will be replaced, but not with a hire on the tenure track. Rather, the department will hire a one-year appointment with the possibility of renewal.
"UM is still plugging holes in instruction, and I think that's probably something that is felt more seriously in a lot of other departments," Semanoff said.
He agreed the campus budget is "bare bones." He said UM not only needs to make up lost ground where it made deep cuts, it needs to be able invest in departments on the upswing.
"Programs that are experiencing growth are still struggling to figure out how they can provide the best academic experience given they're being stretched thin in terms of staffing, faculty," Semanoff said.
'Point of stability'
Lasiter said the current budget picture means UM will not be making additional staffing cuts. He said spending on staff dropped some 20% over the last several years, yet staff represent support for students and facilities.
"We've reached a point of stability, and reductions aren't going to be necessary in the coming cycle," Lasiter said.
He also said early indicators show summer revenue is estimated to be up over last year from $4.32 million to roughly $4.66 million, an increase of nearly 8%. "If that holds true, that's real money."