What the MnSCU finance chief said about House proposals

Concerns

After the House higher-education committee rolled out its new amendment targeting administrative pay, MnSCU CFO Laura King told the committee she was “very comfortable” with the new reporting requirements. (She even said MnSCU found them “quite agreeable.”)

She also said MnSCU was OK with the proposed restrictions on bonuses.

But she had this to say about the requirement that MnSCU cut administration to make up for future shortfalls (instead of cutting programs or raising tuition and fees):

The consequence of the language really faces us with some serious budget cuts. Under the amendment, we would have a gap of $17 million in our financial plan for compensation, which is about a 25 percent gap in our financing. Since we don’t control negotiations for the classified units or the health insurance costs, that gap really will land on our negotiations with the faculty unions. And that’s a great concern for us.

The language targets reductions in our administration budget, which … is already the smallest budget in our operation. We have fewer administrators than we did a decade ago. The real cost of educating a MnSCU student is down 10 percent. Administration as a percentage of our total expenditures is down to just to over 11 percent of our total budget. And as you’ll recall, we’re already ranked in the bottom 10 nationwide in spending on administration.

It’s simply not possible for us to balance our budget on the faculty compensation increases for 54 percent of our employees on the portion of our budget that represents just slightly more than 10 percent of our total spending. So we’re really concerned about that language.”