Higher ed faces millions in cuts

GREELEY – Higher education institutions in Northern Colorado are figuring out how they will cope with budget cuts this year and the coming school year as the economic downturn continues. The schools are looking at ways to cut millions from their operating budgets as state aid slips and other once-stable funding sources are threatened.

All four institutions – Colorado State University, the University of Northern Colorado, Front Range Community College and Aims Community College – are taking a hit, with Aims perhaps facing the most unknown impact on its ongoing financial condition.

Aims is one of only two colleges in the state that depends most heavily on property taxes and oil and gas revenues for its income. Since its founding in 1967, Aims has received most of its revenue – about 58 percent in the current year – from property taxes collected from the Aims Junior College District, the majority of which lies within Weld County.

Over the last two years, real estate values in Colorado have dropped and the next Weld County assessment later this year, based on home values in June 2008, is not looking promising.

“What we’re predicting is the overall value of housing as an aggregate will drop 15 to 20 percent,´ said Christopher Woodruff, Weld County assessor.

Woodruff said that will translate into lower property tax collections in 2010 but the current year should not be seriously impacted. “For the 2009 budget year, everything is pretty much stabilized,” he said.

But revenue from oil and gas operations in the district, which account for about 40 percent of all Weld County tax collections, remain a question mark. “The big thing for us is oil and gas,” Woodruff said. “For ’09 we’re still projecting an increase in the value of oil and gas but we’ll know that by June 1.”

Woodruff noted that the state had strong oil and gas production in 2008 as the price of gasoline topped $4 a gallon last summer. But the sharp decline in gas prices during the remainder of the year still remains to be fully evaluated.

Last month, the Colorado Oil and Gas Commission reported the approval of 8,027 oil and gas drilling permits in 2008, a 26 percent increase over 2007 and a new record. Weld County had the second-highest number of permits at 2,340, a 29 percent increase over 2007.

Could be worse

Marsi Liddell, Aims’ president, said the Greeley-based college is making a 5 percent across-the-board cut for the current school year and will make another 5 percent cut for the next school year to deal with an expected $1.4 million total reduction in state aid.

Liddell noted that Aims is faring better than most other schools, with only about 21 percent of its revenue coming from the state.

“In terms of state appropriations, our budget cuts don’t look as bad as a school that has 60 to 70 percent of its revenue from the state,” she said. “Right now we’re looking OK for this year, but there’s no telling what ’09-’10 and ’10-’11 will look like.”

Liddell said Aims will likely make a tuition hike in the fall to help offset the budget reductions to its overall $43.3 million budget. Aims could get another infusion of money from House Bill 09-1079, which would allow Berthoud residents to vote themselves into Aims’ tax district in exchange for a reduction in tuition.

Aims is planning to build a campus at the northeast corner of Interstate 25 and Colorado 56 just east of Berthoud. A firm date for beginning construction on the site has not yet been determined.

All feeling pinch

Elsewhere in Northern Colorado, other higher ed schools are also feeling the pinch of a sour economy. CSU, the region’s biggest by far, is looking at ways to pare about $7.5 million this year and another $5 million next year from its $820 million budget.

But those cuts are smaller than had been anticipated, and possible layoffs predicted by Interim President Tony Frank in early January may not have to be made, said Richard Schweigert, the university’s CFO. “They make layoffs much less likely in any mass fashion,” he said. “We are keeping our eye on the ball and there’s a March revenue projection that will really define the issue.”

Mike Kupcho, interim president at Front Range Community College, said cutbacks for FRCC’s three campuses, including Larimer County, will amount to about 4 percent, or about $900,000, for the current fiscal year and 7 percent next year.

Kupcho said the $900,000 shortfall will be covered with a contingency fund. “Front Range has budgeted very conservatively now and in the past, so in this current year it’s our intent to cover that with a tuition reserve (fund),” he said.

But it’s the $1.6 million in cuts for the next school year that remain unresolved. “That’s where we’re really having our budget discussions at this point, and we certainly haven’t made any decisions on that yet,” Kupcho said.

UNC in Greeley is expecting to cut back its $177 million budget by a combined amount of about $2.9 million for the current school year and the 2009-10 year. Kay Norton, UNC president, said that’s less than was expected – if those figures hold.

“While this is still a significant amount, it is gratifying to see the governor following through on his often-expressed commitment to higher education,” Norton said in a staff memo. “But it’s also important to remember that his recommendations are based on highly fluid revenue projections.”

Gov. Bill Ritter has proposed about $100 million in cuts to higher education for the 2009-10 fiscal year, an overall statewide reduction of about 12 percent.

Nate Haas, a UNC spokesman, said the university is studying its options for making the cuts. “We are positioned well for this kind of discussion, with our academic plan that identifies areas of priorities,” he said.

Colleges and universities do have one positive aspect of the economic downturn on their side. Laid-off workers are enrolling in droves to reposition their job prospects, and Aims’ enrollment is up about 10 percent for the current school year while Front Range is up by about 8.5 percent.

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