Explaining the deficit

[LosAngelesZipFan]

One of the things that has really bothered me over the last 5 months of sturm und drang/Scarphoon has been the amount of the budget hole that needed to be filled. The U kept talking about a $60 million deficit that needed to be closed, which is significant. Often the scale of the issue was connected to "over-building by Proenza" specifically "that stadium". As I posted earlier, UA's debt is on the high side compared to overall budget (about 1:1), but this isn't unprecedented in Ohio at the moment (UC's debt is roughly 110% of its annual budget from the numbers I could find; Miami is over 90%; Can't about 80%).

What has gnawed at me is that a deficit of that size doesn't just appear unless there is some sudden change in circumstance. The U doesn't just do annual budgets-- it has a team looking at the budget over many years and would have to do so for credit services, the state, etc. It's not possible that the budget would suddenly leak $60 million.

I finally found the answer in the PD article today:

"Scarborough met Wednesday with the Northeast Ohio Media Group's editorial board to talk about how he had anticipated that the moves would be controversial yet why it was necessary to quickly launch a three-year plan to eliminate a $20 million budget shortfall while providing $10 million for new initiatives and $30 million for capital repairs and improvements.

"We didn't have the luxury of time," he said. "We knew we had to make deep changes..."

Ahhhh...it's not an immediate $60 million shortfall. It's a $20 million over 3 years shortfall, about $8 million per year, against an annual budget of $484 million. Closing that gap requires an annual cut of 1.6% to that budget, certainly nothing eye-brow raising.

I totally understand that presidents want to make their mark by implementing their strategy. A big part of their job is to have a vision and then push the institution in that direction. The budget is the mechanism to do this. In this case, it appears that what should have been a budget process was elevated into a crisis and a PR disaster for UA. (Great quote from a new honors student the other day: “It’s good to see Akron’s not dead,” said Kerry Holmes, 18, of Akron, who will study computer science. “It’s just having a little turmoil.”).

The way it appears to me is that Scarborough wanted to have $40 million available to support his vision and conflated that with a (real but manageable) budget deficit of $20 million. "Never let a good crisis go to waste" comes to mind. And if there isn't a crisis near at hand, manufacture one. Ideally, a new college president would marinate a bit on things like this and then go find incremental funding to support his strategic initiatives.

The last 9 months have been a PR disaster creating an impression of a university flailing at its mission and on the edge of failing all together. From the naming dust up through to eliminating the baseball team because it's field as inconveniently situated, it's been one poorly handled, ill-considered, ham-fisted thing after another. I hope he can right the ship and this rocky start leads to a 20 tenure of growth for UA, a golden age when all the potential gets fully realized. But I am dubious, beyond so, that this will be the path.

[Dave in Green]

Not sure why it's necessary to start yet another new thread to repeat opinions on a subject already posted in existing active threads. Each new duplicate thread just results in the same people repeating the same opinions over and over. If we keep it to a minimum number of threads on the same subject we can reduce repetition and save ourselves a lot of time.

[Balsy]

Not sure why it's necessary to start yet another new thread to repeat opinions on a subject already posted in existing active threads. Each new duplicate thread just results in the same people repeating the same opinions over and over. If we keep it to a minimum number of threads on the same subject we can reduce repetition and save ourselves a lot of time.

I actually think this is an important, separate idea, that needs to be discussed and I'm okay with a separate post for it. If this were posted in one of the other threads have been talked to death I might have (along with other members here) glossed over it or missed in entirely. Freeing up $40 million a year to conflate your own policies is worse than I thought personally. Because those are not cuts out of necessity. That lends a lot of credibility to those who have been opposing Scarbororough for his lack of getting to know UA for what it is.

[Dave in Green]

"Conflate your own policies" is nothing more than one person's colorful interpretation of funds earmarked for new initiatives, capital repairs and improvements. We were already discussing in one of the other active threads the subject of cutting programs and people vs. freezing all new development. Anything more I may have to say on the subject will be in that thread.

[Dr Z]

Continued here.