Budget Oversight Committee Guidelines

On the recommendation of the Budget Oversight Committee (BOC) I am sharing these preliminary guidelines with our community. They are our response to the financial implications for Texas higher education and MSU Texas of the COVID-19 crisis and include scenarios we think may emerge in the coming weeks and months.

Short Term, the Current Fiscal Year

As we work together to finish this fiscal year with a balanced budget, we want to be able to begin a new academic and budgetary year fully operational. There is some uncertainty regarding the state appropriation for this current fiscal year, given the dramatic drop in oil prices and loss of sales tax revenue. For that reason we are recommending two immediate actions for the remainder of this fiscal year. First, we should limit all spending to essential expenditures only. Second, we will defer all searches except those deemed critical to serving students and/or supporting faculty instruction. For those searches now in progress, employees should work with their supervisors to determine whether to pursue the Cabinet’s approval to proceed. With almost half of the university’s budget invested in salary, wages and benefits, slowing hiring is essential.

Mid-term, Fiscal Year 2021

For the upcoming academic year the toll of the Covid-19 pandemic will continue to affect the Texas economy. We therefore anticipate reductions in our FY 2021 budget and in the next two years’ budget cycle as a result from the upcoming legislative session. To plan for these likely reductions we expect to continue limiting essential spending and deferring most searches. Additional budgetary reductions will likely be needed and various models will be considered and prioritized by the BOC and the cabinet. Shared oversight of finances as demonstrated by the members of the Budget Oversight Committee will be critical if the 2021 budget reductions we anticipate become a reality. The BOC has met regularly to plan and deliberate over next year’s budget and priorities. I have asked them to continue meeting regularly in the upcoming year; careful planning can prepare us for better decision-making and a more stable financial position.

Long-term, Fiscal years 2022 and 2023

We know that universities across the United States are anticipating challenging times ahead. For our fellow public universities, alongside state support, the majority of budgetary resources come from tuition and fee revenues. Therefore, any decline in enrollment can have a particularly negative budgetary impact when coupled with the COVID crisis. This makes attracting and retaining students at MSU a priority and focus that aligns with careful and inclusive budget management. Since we cannot yet know the extent of the COVID crisis, its impact on higher education and on the American economy, this is an important moment to bring together the talents and innovations that make MSU a vibrant living and learning community. Thank you in advance for helping us successfully manage our way through these challenging times together. 

Suzanne Shipley