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Officials: Proposed budget cuts would severely harm ASU

January 15, 2009

The options proposed Jan. 15 by the Arizona Legislature would cut the university system’s budget by up to $243 million for the remaining few months of fiscal year 2009, and $388 million for fiscal year 2010. This would be the largest higher education budget reduction in the state’s history.

Cuts of this magnitude would require ASU to reduce costs by up to $126 million in less than five months and $194 million next fiscal year.

ASU opened its fiscal year 2009 budget year having already taken more than $37 million in state funding cuts in the previous 18 months, resulting in the elimination of 265 jobs. Since that time, the university has taken additional actions in preparation for the possibility of further reductions that has led to a cumulative elimination of almost 500 staff positions and more than 200 faculty associates, the disestablishment of two schools and a reduction in the number of nursing students.

ASU administrators say that it is unreasonable and irresponsible to expect the university, the state’s largest and the producer of more than half the state’s bachelor’s degrees each year, to suffer cuts anywhere near this magnitude without severely curtailing the service it provides its 67,000 students and reducing the enormously important role it plays in the state’s economy.

“The fact that the Legislature has known about the state budget problems for months and failed to take appropriate and effective action to minimize harm to Arizona’s families and economy is unconscionable,” says ASU President Michael Crow. “Our students and their families, ASU alumni, and the working men and women of Arizona – all of whom are taxpayers and will be affected by this action – deserve better.

“The decisions made by our elected leaders concerning the fiscal year 2009 and fiscal year 2010 budgets will be the most important political decisions made in the nearly 100-year history of the state. For that very reason, there needs to be a thoughtful and public discussion of the options. Otherwise, the Arizona of the future may more closely resemble a far-off Third World country than nearby states such as Colorado and Texas.”

ASU pumps $3.2 billion dollars each year into the state’s economy and creates tens of thousands of jobs. Each year, it graduates more than 14,000 students, including engineers, nurses, mathematicians, scientists, teachers and entrepreneurs. These graduates – which include more than 151,000 alumni still living in the state – are responsible, in turn, for tens of billions of dollars of the state’s gross domestic product and constitute the largest single group of taxpayers in Arizona.

“You can’t cut your way out of a budget deficit of this magnitude,” says university economist Dennis Hoffman, who also is the associate dean at ASU’s Seidman Institute. “The Legislature needs to consider other options because a budget cut of this magnitude, if taken, will cause a sharp drop in the state’s gross domestic product and prolong what is already a painful recession.”

ASU already had been planning for an additional cut of 5 percent by taking actions to reduce expenses while preserving educational quality, access to a college education and the production of a skilled work force. Cuts of the magnitude proposed by the Legislature would cause the university to lay off or furlough additional employees, and to consider program reductions that might affect students entering this fall and beyond.

Virgil Renzulli,
(480) 965-8526 direct line

Terri Shafer,
(480) 965-3865 direct line / (602) 363-2318 cell