FROM:  Mary Spilde

DATE:  November 10, 2001

RE:  Budget

As we embark on our budget development process for 2002-03, I wanted to share some thoughts with you about the budget. 

First, I need to share information about the current year. Some work still needs to be done to balance this yearís budget as a result of increasing the bargaining parameters. As I have said before, we made this recommendation to the board knowing that it would impact the budget.  We still believe this was a good decision and are committed to it. In addition, the current State of Oregon revenue shortfall creates challenges for us.  We have already been asked to cut 2% for this year and next. It has been suggested that the new revenue forecast that will be published on November 30, may show a shortage of up to $700 million for the state. This may result in further cuts in the collegeís state revenue.   Obviously, this impacts the current budget as well as our projection for 2002-03. Some of you have told me that you are concerned about the impact this might have on your jobs for this year.  In response to that, I have said that we will do everything we can to get through this year without major changes in programs, services or staffing patterns. We will be looking at Materials and Services carryover and other means to balance this yearís budget. 

Despite the uncertainty we must move forward with the budget process for 2002-03.  On Tuesday, November 13, we will have a budget forecast that will guide our work.  Last year at this time our projection for 2002-03 showed a deficit.   The changes mentioned above will undoubtedly make the situation worse.

I am well aware that many staff believe that the college has ìcried wolfî in the past and may find it difficult to believe that the college lacks funds. All I can say in response is that I believe that the college has a serious budget problem.  We have cut approximately $1 million of courses and services each year for the past five years. We have been funding continuing expenses from one-time money and we can only do that for so long.  It is clear to me that we need to come to grips with the fact that our expenses exceed our revenues.  However, I know that for you to reach the same conclusion the budget must be more ìtransparent.î  I will be doing everything I can to make the budget and the process more open and understandable so that we can have more of a shared view of our budget situation. Let me be clear that while I am committed to this effort and to exploring every budget assumption and every part of the budget, in my opinion this alone will not solve our budget problems.  Therefore, we must simultaneously be looking for ways to reduce expenditures.  This will be a painful task but one that is essential to the future of Lane.

As we begin the budget development process for 2002-03, itís important to keep in mind that our budget is a planning document. It is a reflection of the priorities and values of the college. The budget is an expression of what we believe is important and puts appropriate resources in place for our goals to be achieved.   Therefore, it is important that the decisions we make about the budget are based on furthering our vision and mission, and accomplishing the college strategic plan and the priorities set by the board in the work plan. There is much work to be done to hone our strategic directions and bring clarity and specificity to what we want Lane to be as an institution over the next five years.  This will not be fully accomplished this year but we can begin it.

As a long-term solution, continuing to trim around the edges or asking departments for percentage cuts or taking across-the-board reductions or doing more with less compromises the integrity of our programs and services to students. As a college, not only are we experiencing the effects of this budget strategy it has not allowed us to maintain fiscal health or accountability. Such a financial strategy cannot be sustained over time if the college is to grow or if we are to be good stewards of the public resources.  One alternative is to reduce or eliminate some functions.  This means that we will stop offering some things that are serving the community in order to avoid diminishing the quality of everything else we do.

What the college community is about to engage in is more than balancing our financial statements. Yes, this will be an outcome, but we will be doing much more. As a college, we will be defining what it means to be a comprehensive community college. Lane will continue to offer professional technical/ career preparation and retraining, lower division transfer, developmental education that supports our mission, personal enrichment and community services. As directed by statute, we will be a comprehensive community college but as a result of fiscal constraints we will likely do less in each part of the mission. Our intent is to bring into balance our services, program offerings, and staffing. This realignment with our core mission will drive how we allocate resources. This clarity of mission ultimately will help us achieve our strategic intent ñ providing a comprehensive college where our students succeed. Our goal is to be a college that serves our community while being fiscally sound today, and in the future.  Our goal is to come out of this difficult process stronger and more focused.

In the next few days we will fully engage in the budget development process for 2002-03. Some preliminary work has already been done but starting next week it is my intention to seek broader participation in the budget process.  I am committed to making this process as open and inclusive as possible. This will occur through involvement in department planning as well as in some college-wide work groups that will look at different aspects of the budget.  I also intend to maintain ongoing communication about the budget so that everyone can know what is happening.  This will take place through e-mail, posting to the web site, the Dailyís and occasional forums so that we can communicate directly.

Any budget reduction process creates uncertainty.  Having all the information available means that we all will live with a level of ambiguity as we determine together the size and scope of programs and services that will become Lane. I want to be sensitive to the feelings raised by this uncertainty and will do all I can to communicate where we are with the budget process.  I will make every effort to ensure that this process is humane and respectful.

There is a lot of work to be done in the next three months. In the next few days you will receive a plan for Phase 1 of the budget development process as well as a timeline.  I ask that you work with me as we meet this challenge.