Regaining fiscal health a necessity


Office of the President

Balancing the budget requires compromise, sacrifice

October 23, 2017

Dear Faculty, Staff, and Students,

As you know from my communications during the past year, the University has been spending more money than it has brought in over the past four years. This has required us to tap into our fiscal reserves in order to pay our bills. We cannot continue to do this. Quite simply, annual expenses must be balanced against annual revenues. 

For our current fiscal year, each unit at WSU has been instructed to reduce its spending by 2.5 percent. Specific dollar amounts have been communicated to all areas. Our goal is to reduce our $30 million annual deficit spending by $10 million in FY2018 and continue these reductions in future fiscal years until the deficit is eliminated and our reserves have returned to healthy levels.

While we are working hard to minimize the impact of these cuts on students, faculty, staff, and the community, difficult decisions must be made. And while our personnel are the University’s most valuable resource, salaries and benefits make up approximately 85 percent of the budget. Thus—while it is a very difficult and agonizing process—it is inevitable that we must eliminate and restructure some positions and units in order to get our budget in balance.

Already, many University departments have reduced some positions or will not renew temporarily funded positions in order to meet required spending reductions. That list includes Athletics, Finance and Administration, Performing Arts, Student Affairs, and academic colleges. Many of the affected programs do not have permanent funding, meaning that they were funded on a one-time basis using reserves, causing a depletion of these reserves. Also, some were part of programs that do not receive state or tuition funding and are not otherwise self-sustaining. 

One such program is Performing Arts. In its seventh year, the Performing Arts program has provided outstanding entertainment and arts for the University and the community. It has contributed significantly to the cultural richness of our community. However, ticket sales, grants, and gifts are not enough to keep it financially viable. More than $1.6 million in funding from University reserves has been used to support the program since its inception. This approach is simply not sustainable given other pressing budget challenges we face. Unfortunately, this means that positions will be eliminated when the Performing Arts program is ended at the close of this performance season.

Similar to Performing Arts, temporary employees in the Office of Multicultural Student Services and in the Office of Equity and Diversity have been funded for multiple years using University reserves. Several two-year temporary positions were established to support an increasing number of diverse students. However, no permanent funding was designated at the time of their creation and no permanent funding has been identified since then.

Again, a difficult decision is required since we cannot continue to fund these positions from our reserves. As a result, we will not be able to renew several temporary employment contracts. In the coming months, both the Office of Multicultural Student Services and the Office of Equity and Diversity will be working with the Vice President of Student Affairs to address concerns regarding staffing levels.

These decisions are painful. They will disrupt lives, and the consequences of eliminating and reducing positions will ripple throughout our community. But as much as I and members of the leadership team regret the necessity of these actions, they must be taken in order to restore the University’s overall fiscal health.

We will continue to keep you informed about our budget situation on a monthly basis throughout the academic year. Each of us has a role to play in this effort—all University departments and campuses are impacted in one way or another.

Thank you for your continued support of the University. Working together, we will return WSU to financial stability.

Kirk Schulz, President
Washington State University

Office of the President, Washington State University
PO Box 641048, Pullman, WA 99164-1048

Washington State University