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Officials see no more cuts

BY JORDAN FRIES | DECEMBER 14, 2009 7:30 AM

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The Iowa Revenue Estimating Conference concluded its Dec. 11 meeting with a rare announcement of hopeful news.

Despite a further decrease in state revenue — roughly $37 million less than officials estimated in the fall — the panel said no more midyear budget cuts would be necessary. The state is almost halfway through fiscal 2010.

But members of the state Board of Regents would not comment on Sunday how the latest estimates could affect tuition increases. During their meeting last week, the regents postponed a vote to increase tuition by 6 percent until their February meeting, at Iowa State University.

When delaying the vote, regents said they wanted to ensure they had the most accurate figures.
Statewide, there is still $188 million left in savings after officials trimmed 10 percent from the budget in October, according to the committee.

Gov. Chet Culver was “encouraged” by the recent report and said in a statement that “Iowa has likely seen the worst of the national recession.”

The results of the meeting show that revenue should “remain stable,” but because there is no significant increase, it’s difficult to tell whether the report will affect the tuition decision, according to UI officials. It’s also premature to forecast how the results will dictate potential furloughs in the College of Liberal Arts and Sciences, said the college Dean Linda Maxson.

She has said cutting back class schedules to include more students, eliminating graduate programs, and combining programs, such the School of Journalism and the communication-studies department, would be possible solutions to level the $8 million in cuts facing the school — by far the largest deficit of any college at the university.

UI President Sally Mason has also said, based on October estimates, she expected to lay off at least 20 faculty as part of balancing the budget for fiscal 2011. She wasn’t available for comment on Sunday to confirm if those layoffs are still part of her budget-trimming plan.

Though the report said there will be no future cuts in the current fiscal year, some UI officials still believe the revenue results should have been more positive instead of merely static.

Charles Whiteman, the senior associate dean of the Tippie College of Business and forecaster for the UI Institute for Economic Research, said his results are far more optimistic than the revenue committee’s, predicting 60 percent more revenue increases for the next year than that panel did.

“They used my input in coming up with their results, but they won’t disclose how they came to such a different conclusion from me,” he said. “My forecast shows results that are slightly better than expected instead of remaining the same.”

But Regent Robert Downer said he believes the estimate is very close to what was expected and that levels of state appropriation should remain constant for the remainder of the fiscal year.

“We haven’t received any more bad news, but there is still a long road ahead of us,” he said.


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