University of Southern Maine

News Releases

USM Makes Cuts to Balance FY ‘09 Budget, Invest in Future Growth

May 19, 2008

USM, to date this fiscal year, has eliminated 91 full and part-time positions as part of a plan to cut and reallocate more than $6 million in fiscal year 2009, which begins this July 1, 2008. The 91 positions include 67 full-time and 24 part-time positions, for a full-time equivalent (fte) total of 79, since July 1 of 2007.

Eighteen of the 91 positions involve layoffs, including 14 full-time and four part-time people.  The remaining 73 of the 91 positions have become vacant due to retirements, resignations or the elimination of fixed-length positions. The 79 fte positions represent 6.5 percent of USM’s fte workforce of 1,237. With the latest round of position eliminations, USM, since September of 2006, has eliminated 109 fte positions.   

This year’s elimination of 91 positions results in total salary and fringe benefit savings of $4,914,044. Changes in business processes, the use of revenue-generating operations to fund select positions, and permanent reductions in equipment budgets account for the remaining $1.1 million in cuts. 

Original plans called for USM to cut a minimum of $2 million each year in fiscal years 2008 through 2010, a move that would have balanced the budget at the end of 2010.  Earlier this spring, USM Interim President Joseph S. Wood decided to move more aggressively to balance the budget.

Wood said the cuts will help USM balance its budget and make reallocations so that the university no longer runs year-to-year deficits in specific, department budget lines, improving budgetary controls.  “We also will reallocate,” reported Wood, “so that we invest in recruitment, marketing and related areas that support student success and reinforce the quality of this university.” 

“We’re returning USM to fiscal sustainability sooner than originally scheduled so that we can focus on providing the kind of high-quality, transformative education that the students and communities of this state deserve,” said Wood. “It has been painful,” he added, “but the staff and faculty deserve a lot of credit for working to ensure that USM remains a major asset to our region and our state."  Wood added that despite the fiscal challenges of the past year, “USM has achieved several milestones, including our largest-ever graduating class of 1,747 students and approval of General Education, our nationally recognized core curriculum.”

Wood announced the cuts to USM faculty and staff earlier this morning (5/19, see www.usm.maine.edu/mcr/update/) and is scheduled to inform University of Maine System Board Trustees at the board’s meeting, scheduled today (5/19) at the University of Maine at Presque Isle.  

USM began running year-end deficits in fiscal year 2005 and, as was reported earlier, will end fiscal year 2008 with a projected deficit of just under $3 million. USM’s total budget for FY 2009, the fiscal year beginning this July 1, 2008 will total just under $138 million.

“We still have work to do,” said Wood, “including another $1.5 million in cuts for fiscal year 2009 to cover such items as compensation and benefits, and increases in energy costs. But now that we’ve addressed longstanding budgetary problems head on,” said Wood, “I’m confident that USM can focus on the future as opposed to what happened in previous fiscal years.”  

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