While University President Mary Sue Coleman is preparing to make her case to Michigan legislators later this week for University funding, Provost Teresa Sullivan is warning members of the University community that major cuts in state appropriations to the University may be on the way.

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In an interview with the Daily on Tuesday, Sullivan expanded on remarks to the Senate Advisory Committee on University Affairs regarding the expected cut.

Sullivan said that she, students serving on her student budget advisory committee and student government representatives from the University’s three campuses recently met with officials from the state House and Senate Fiscal Agencies when they received news of the expected drop in appropriations.

“What they were saying was that higher education could get a 20- to 25-percent cut,” Sullivan said of the briefing. “Twenty percent of our budget would be $68 million.”

With those cuts, Sullivan said that units throughout campus are likely to feel some of the pain. But, Sullivan did say that central units — like those that are directly overseen by a University vice president — would be asked to make cuts before academic units, as a way to shield students’ educational experience at the University from some of the steepest cuts.

In the interview Tuesday, Sullivan would not rule out the possibility of a tuition increase. She did say however that cost containment efforts and central cuts would be made before any tuition increases or academic unit cuts were to be considered.

Sullivan said cost containment efforts underway at the University should be able to cover next year’s expected loss in state appropriations over time.

At her annual State of the University address in October, Coleman called on faculty and staff to double their efforts to cut costs, announcing plans to cut $100 million from the University’s budget over the next few years.

Sullivan said that despite the bad news, she understands the difficult position the state is in, citing revenue shortfalls as a major concern among legislators.

“It doesn’t mean the state legislature doesn’t like higher education, it just means they’re not getting enough revenue and they’ve got to find something that can be cut because the constitution requires a balanced budget,” she said. “It’s a very difficult place to be.”

Sullivan appeared at a Senate Advisory Committee on University Affairs’ meeting on Monday where she warned of dramatic cuts in state appropriations.

Speaking before SACUA — the University’s leading faculty governing body — Sullivan cautioned faculty on what the future may hold.

“I do think we will have an historic cut,” Sullivan said of next year’s state appropriations.

In the draft of Coleman’s letter to state lawmakers released on Monday, Coleman described the role University can play in the state’s economic recovery and outlined efforts underway at the University to increase student access to the school while also cutting costs.

State appropriations to the University have fallen substantially since the early 2000’s. From fiscal year 2003 to fiscal year 2004, state appropriations to the University fell approximately 10 percent — or $36,356,600. Since that year, state funding to the University has remained around $320-$330 million each year.

Though Coleman did not specify how much money the University will need from the state, she outlined the successes of the University and what cuts may be necessary in the future.

In her letter, Coleman told legislators that despite the current difficulties in the state’s budget, the University must remain a top funding priority in order to better the state’s chances of experiencing an economic recovery.

Coleman warned state lawmakers that cuts to the University could have serious consequences for Michigan’s economy.

“We acknowledge the fiscal circumstances of the state,” Coleman writes. “Nevertheless, the University of Michigan is an essential component in the stabilization and revitalization of the Michigan economy.”

“We also play a critical role in the development and education of our workforce and cannot risk jeopardizing the quality of our instruction, research and service,” Coleman continued in the letter. “The impact of the state’s historic contributions to the University of Michigan’s success cannot be overstated, and we believe that the state’s continued investment in our success is central to our collective future.

Coleman also outlined potential cuts to University programs that may be necessary, saying, “aggressive policy and organizational changes will be required.”

“Additional cost reductions of over $22 million are factored into our FY2010 budget,” she wrote.

Though a draft of Coleman’s letter has been released to the public, the letter awaits expected approval by the University’s Board of Regents, who will consider the draft at their monthly meeting on Thursday.

State legislators cut approximately $1.9 billion from the budget in negotiations earlier this year, though projections currently estimate lawmakers may need to cut an additional $1.4 billion next year.

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