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Larry MacIntyre
University Communications

Last modified: Wednesday, January 7, 2009

IU President McRobbie orders spending reductions of $4.9 million

Jan. 7, 2009

BLOOMINGTON, Ind. -- Indiana University President Michael A. McRobbie today (Jan. 7) directed all IU vice presidents, chancellors and deans to immediately reduce their operating budgets by at least $4.9 million through the remainder of the current fiscal year.

The action, which applies to all IU campuses, schools and administrative offices, is in response to notification from the State Budget Agency that state operating funds for IU are being reduced by 1 percent, or $4.9 million, for 2008-09.

Overall, state operating funds provide about 19 percent of IU's $2.6 billion annual budget.

"You should consider delays in administrative hiring and reductions in equipment, supplies and travel, along with other operational reductions that will generate cash savings," McRobbie told senior administrators.

McRobbie cautioned that while these reductions should be considered as one-time cuts -- as opposed to permanent reductions to base budgets -- senior administrators should remain flexible and be prepared to make additional spending reductions in the 2009-10 fiscal year.

"The current state of the economy is forcing some very difficult decisions on the governor and legislature as they work to prepare the next biennial budget," McRobbie said. "It is my intent that Indiana University will find ways to operate at these reduced funding levels without sacrificing the quality of our basic academic and research missions."

McRobbie said amounts designated for student financial aid and student technology would be exempt from the reductions.

The directive is the latest in a series of actions taken by McRobbie in response to the state's diminished revenues. In October, McRobbie ordered a slowdown in administrative hires, and last month he announced that salaries for as many as 400 of IU's senior administrators would be frozen in the upcoming fiscal year, saving more than $2 million.

McRobbie noted that the latest revenue forecast shows Indiana state government now anticipating a shortfall of $763 million in its fiscal 2009 budget.

"We are taking these steps in order to preserve the quality of our primary mission of education and research," McRobbie stated. "As state officials wrestle with these financial challenges, it is our hope that they, too, will keep in mind the importance of maintaining a higher education infrastructure that will be the foundation of an economic recovery for the State of Indiana."