1. Office of the President Budget Update President John D. Haeger January 28, 2009

2. Office of the President Arizona State Budget

3. Office of the President Arizona Has the Largest % Budget Shortfall of all 50 States State (top 10)Size of Gap Percent of FY2009 General Fund Arizona$1.4 billion13.90% California$13.7 billion13.60% Georgia$2.5 billion11.70% Rhode Island$372 million11.40% Utah$620 million10.40% Florida$2.3 billion9.00% South Carolina$554 million8.10% Tennessee$884 million7.80% Colorado$604 million7.70% 3 Source: Center of Budget and Policy Priorities, January 15, 2009

4. Office of the President JLBC Projections/Assumptions Projected general fund shortfalls: –FY09 up to $1.6B –FY10 Up to $3.0B General Fund revenue will not return to FY08 level until FY12

5. Office of the President Arizona’s Budget is Heavily Weighted Toward Education and Human Services Source: Budget Update and Review of Voter Protection, November 18, 2008 Education

6. Office of the President 2/3 of State Spending is Mandated, Either Through Statute or Voter Protection (figures in $100M) Source: Budget Update and Review of Voter Protection, November 18, 2008

7. Office of the President University Appropriations as % Total State Budget, FY79-FY09

8. Office of the President NAU Budget

9. Office of the President Total Revenues: $401,000,000 Debt Svc Alloc, $15M Other Revenue, $10M

10. Office of the President

11. % FY09 State Budget in Activity Areas Total Budget $214,000,000 11

12. Office of the President Salary and ERE are approximately 75% of Divisional Budgets 12

13. Office of the President NAU’s Budget Planning

14. Office of the President What Those “Tri-U” Cut Numbers for FY09 mean for NAU Tri-U NumberNAU’s Portion (15.25% -- NAU proportion of FY09 General Fund Allocation) $50M$7.63M $100M$15.3M $150M (best guess for FY09)$22.9M $170M$25.9M

15. Office of the President FY08-FY09 Initial Strategies Beginning of FY09

16. Office of the President $50 Million Strategies StrategyApprox. Amt Discussion VP Targets$6 MTargets set at approximately 5% for all VP areas except Academic Affairs is 3.6% President - $700,000 (includes intercollegiate athletics, capital assets) Original target was $1 million but included utilities Exec VP - $10,000 VP Research - $100,000 Provost - $3,000,000 VP Admin and Finance - $275,000 VP Enrollment Management - $525,000 VP Advancement - $40,000 CIO ITS - $500,000 VP Distance Learning $775,000 VP Institutional Effectiveness $50,000

17. Office of the President $50 Million Strategies StrategyApprox. Amt Discussion VP Targets$6 MCont. Unfilled lines/vacancies/searches stopped or eliminated Over 20 tenure-track searches (some continue as non-tenure track) Over 10 distance learning faculty positions Athletics Development Officer Budget Administrator Legal Affairs 6 positions Capital Assets 8 positions Admin and Finance 3 positions ITS; other postponed 12 positions EMSA 10 distance learning staff/admin 10 Provost staff positions Mid-year faculty salary increase postponed Closure and reduction of support for centers and institutes (closure of the High Altitude Training Center Eliminate residence life computer labs and eliminate modem pool

18. Office of the President $50 Million Strategies StrategyApprox. Amt Discussion VP Targets$6 MContinued Rely increasingly on part-time and non-tenured faculty Administrative offices will have less staff to provide services to students and university departments Severe reductions in travel, equipment, abandoned planned purchases, program improvements and capital projects Distance Learning site services reduced Tuition and Fee Collections $3 MDiverted tuition revenue planned to be invested in education needs such as hiring permanent faculty Request tuition and fee increases from ABOR

19. Office of the President DRAFT -- $100 M AUS means approx $15M NAU in addition to $50 Million Cut StrategyApprox. Amt Discussion Furlough days(?)$2 MIf possible; needs action for FY09; Modeling various scenarios; exploring legal options Stop health program development $2 MOccupation Therapy – Flagstaff Physician Assistant - Phoenix Increase VP Targets, Increase Revenue, Use Local Sources $1 M (total $7 M) Depends on Board action on ability to raise revenue. Would need to use local sources in FY09, but make permanent through targets in FY10 Reduce distance learning site services Part of VP targets

20. Office of the President DRAFT -- $150 M AUS means approx $23M NAU in addition to $100 Million Cut StrategyApprox. Amt Discussion Furlough days(?)Increase $1M; (total $3 M) Would need to find permanent solution for FY11 Athletics (in addition to VP cut)$300K-$1MReductions in athletics; looking at when and how savings could occur Tuition and Fee Increase - Reduction in Scholarship Aid $1-2 MDepends on Board Action Health Care Benefits$300K-$1MIncrease premiums; decrease richness of benefits Use Local Balances$1-3 (to tide us over) Again these are shorter-term strategies; eventually must be permanitized Increase VP Targets,$2 M (total $9M) Must be made permanent in FY10; includes distance learning site closures Reduce public service, community outreach, centers and research $1 MReductions

21. Office of the President DRAFT -- $200 M AUS means approx $30M NAU in addition to $150 Million Cut StrategyApprox. Amt Discussion Tuition and Fee Increase - Reduction in Scholarship Aid $2-5 MDepends on Board Action Athletics (in addition to VP cut) $1M - $8M Severity depends on level of cut; major savings not recouped until FY11 or later Increase VP Targets,$2-3 M (total $12 M) Reductions; including NAU-Yuma; other Reduce support to locally supported activities (ASNAU, recreation, alumni, development, etc.) $1 -3MReductions

22. Office of the President See Budget News and Views: http://www4.nau.edu/president/budgetshare.htm budgetinfo@nau.edu Share Your Budget Views and Rumors You’ve Heard. E-mail:

23. Office of the President QUESTIONS?