Less than a month after the Oregon University System’s Vice Chancellor for Finance and Administration declared that Oregon colleges are in a dire state financially, the President of Western Oregon University gave a speech to his students and faculty to explain the school’s bleak financial predicament.
The university will spend about $3 million more dollars than it has during the 2005-07 biennium, the two-year budgeting period used by the Oregon University System, said John Minahan, Western Oregon University President.
Coupled with a possible strike from its faculty, the situation at Western is rough, said Cheryl Gaston, director of Western’s Public Relations. Gaston added that the school is nowhere near shutting down.
“We are not going out of business,” she said.
Western won’t be in the hole $3 million at the start of the 2008 fiscal year, said Gaston, but the school is required to have a fund balance of between 5 and 15 percent of its total revenue at the end of each year, a requirement that all Oregon University institutions must meet.
“If we are projected – with nothing changing to end the 2007 biennia – with zero fund balances, that doesn’t mean we start the next fiscal year with no money,” she said.
State money and tuition funds will still create the budget, but more program cuts would have to be made to remedy the shortfall of the 5 percent fund balance, she said.
Western, which enrolls slightly fewer than 5,000 students, is also near the brink of a strike from its faculty. Western has offered a 9.7 percent pay increase for the faculty, who agreed to a two-year pay freeze in 2003, but the faculty is demanding a 14 percent pay increase, which Gaston says is just too much.
“It’s really hard to understand why we can’t come a little closer, because we cannot move off this number,” said Gaston. “We’re not dead yet. We’re hoping that we can find a way back to each other.”
“This strife is still not tearing us apart,” she said. “This is a University that loves its students, and there’s more sadness than anger.”
Kirby Dyess, vice president of the Oregon State Board of Higher Education, said at the last state board meeting in March that the financial situation of all the Oregon University System schools is in such bad shape that perhaps an institution should be sold or closed down. Her statement, however, was meant to make a point rather than be a practical solution, she said.
Jay Kenton, the Oregon University System’s Vice Chancellor for Finance and Administration, gave a presentation at the March 2 State Board of Higher Education meeting that outlined the financial situation for Oregon institutions. He said rising faculty benefits, insurance and utility costs are outgrowing the gradual increases in tuition and state funds.
“Everybody’s kind of struggling,” he said. “We kind of have a crisis. – There’s just a lot of uncertainty, and most of it is fairly negative uncertainty.”
To remedy the state wide financial crunch, the State Board of Higher Education has proposed multiple legislative actions including redirecting control of faculty benefits to the Board of Higher Education to enable them to seek out more affordable and moderate health care and retirement benefits.
Kenton said that there is currently about $25 million in cuts being made across the system.
“We are not on a sustainable financial pathway,” he said.
“Something needs to change.”
At Western, plans to heal the financial dilemma have been established. They include increasing private donations, cutting programs, and most importantly, increasing enrollment. Gaston said at best the University needs to gain 250 more students.
In Minahan’s speech to students and faculty at Western, he encouraged students to tell their high-school-aged friends about how much they love Western.
Andy Douglas, a freshman at Western, said the turmoil on campus hasn’t affected student life.
“It’s still like any other University,” he said. “There are always activities and concerts and stuff. I still get all my classes; there are still scholarships available.”
Douglas said he’s not worried about the situation getting any worse.
“It would suck if we shut down but I don’t think that would happen. It’s a state university and a lot of people care about it,” he said. “I love it here.”

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