The Associated Press June 24, 2010, 8:15AM ET

Almost $60 million in cuts suggested at U of Ill.

A University of Illinois group looking for ways to save money in the school's administration is proposing a series of changes it says could save close to $60 million over the next two to three years.

The group says the changes represent more than just accounting, but parts of a fundamental shift the university needs to make to become less dependent on the state's financially troubled government.

The administrative group, which was set up late last year, said Wednesday that the university should do a better job of using its buying power to save money on purchases, predicting up to $22 million in savings. The group's report also said the school could save about $18 million in information technology functions, and that the U of I could save another $3 million by combining some higher-level administrative jobs. Other job cuts are likely, though the report doesn't lay out specifics.

The report said the university is at a "watershed moment" in its history, in large part because of the state's troubled finances and the dwindling state support for higher education.

"We've lost about $130 million the last few years from state government," said Craig Bizzani, the group's co-chairman and a senior adviser at the university's fundraising arm, the University of Illinois Foundation.

The university now gets about 16 percent of its $4.7 billion budget from the state, but this year the school hasn't been able to count on even that.

The state government is wrestling with a $13 billion budget deficit and says it can't afford to provide money appropriated for universities and other institutions. The University of Illinois is waiting on $332 million in state appropriations for the fiscal year that ends this month -- money that could be held up for months or more.

"We don't see a light in the end of the tunnel," Bizzani said. "We have to be engaged in self-help at some significant level."

Interim university President Stanley Ikenberry set up the group of deans, provosts and other university officials last November, along with several other committees separately reviewing the finances of the university's three campuses.

After incoming President Michael Hogan starts work next month, Ikenberry will be in charge of implementing the recommendations. Most are expected to be put into practice, and a few already have been, though the system isn't required to act on all 43 recommendations, university spokesman Tom Hardy said. Some would require approval of the university's governing board of trustees; others would not.

The report says the biggest chunk of savings, $22 million, should come from maximizing the university's purchasing power.

Only about 20 percent of the more than $300 million the university spends each year on supplies and services is through what Bizzani called well-negotiated deals.

The university, the reports adds, should also review all of its vice president, vice chancellor and assistant vice chancellor positions, to find areas to combine jobs and save money.

The report makes clear that some jobs will be lost, though it doesn't advocate widespread layoffs or across-the-board cuts. Just how many will be lost is unclear, Bizzani said, but one recommendation he noted would centralize the ongoing purchase of computer work stations and streamline their maintenance -- the university has about 45,000 of them -- and in the process cut up to 50 technical staff members, saving more than $3 million.

The American Federation of State, County and Municipal Employees union, which represents about 2,000 university employees, said it was still going over the report but complained that the ideas were the product of a group that didn't include the majority of people likely to be affected.

"It's regrettable that university administrators who produced this report sought no input from students or from university employees and their unions," union spokesman Anders Lindall said. "Savings it suggests must not come at the cost of further cuts to university classes or programs, or again dumping the burden of the state's broken budget onto Illinois students, their families and university employees."

The report also urges the university to ask the state to ease its regulation of, among other things, purchases in areas where only one supplier is available.

The state requires public agencies to make a presentation before an ethics board for each of its 1,200 annual purchases that come from single-source suppliers, he said.

"We don't bid for cadavers; there's only one source," he said, citing an example from the university's medical school. "And for the state to put us through weeks of paperwork and to go to Springfield to do a single-source bid, those are the kinds of things that take money."

The report's recommendations could all be enacted in two or three years, Bizzani said.

Ikenberry said in a statement that he hopes to work quickly on the recommendations.

"Good ideas and recommendations are useless sitting on the shelf," he said. "Change will not occur overnight, but it must occur promptly."


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