The state is relying on federal stimulus funds (ARRA) for 2010/2011 to keep Penn State at flat funding from 2008/2009 levels. However, stimulus funding ends June, 2011, reducing Penn State/College base funding by 6%.
If these funds are not restored by the state, this, combined with increased operating costs including costs due to significant statewide funding shortfalls in state employee retirement system (SERS), will create a college programmatic budget shortfall of almost $11 million. This shortfall requires college agricultural research and extension program budgets to be reduced by an estimated 20% by July 1, 2011. This equates to approximately 163 positions in the college.
As a result, effectively July 1, 2010, college budget administrators have been charged to reduce impacted lines by 5%. This initial cut will impact all units. An additional 10% reduction will follow; metrics and processes are being developed to strategically identify areas for these additional budget reductions. The college strategic plan will serve as a guiding document to attempt to protect priority program areas.
A “soft” freeze on hiring is currently in effect in the college, and hiring is limited to essential positions and strategic opportunities with leverage from institutes, other colleges, and/or stakeholders. The college will also be evaluating college-wide restructuring options.
The Penn State Ag Council board and delegates were briefed on the situation at the April meeting, and the college will continue to keep them informed. College stakeholders are being encouraged to provide input into the process as it develops.
For more information view the college budget update piece on the college website.
