SEMO expects $20.8 million budget need over next three years

Late last week, Southeast Missouri State University’s executive staff identified a $20.8 million potential budget need over the next three fiscal years, related to the economic impact of COVID-19, according to an email sent to faculty and staff by president Carlos Vargas.

Due to the impact of COVID-19, the university has begun planning for the impact as Missouri lawmakers rework the FY21 budget, according to the email.

Executive staff came to this figure by taking into account several revenue reduction scenarios, including an expected 25% state appropriation reduction, the email stated.

The numbers are estimates at this time, but Vargas said it is “imperative we plan for a reduction of at least this magnitude based on information we are hearing from Jefferson City.”

All divisions within Southeast’s operating budget will have funding reductions of 12.5% over the next five years to meet the university’s $20.8 million goal, Vargas said in the email. To help meet base budget needs, there will be a decrease in utilities and property rental, as well as salary savings resulting from last year’s Voluntary Retirement Incentive Program.

Vargas said the university plans for a continued decline in enrollment, which will result in less tuition revenue. Auxiliary units such as Residence Life will expect revenue declines as well, due to decreased enrollments.

Despite expected funding restrictions, Vargas expressed a desire to invest in not only the institution itself but also in Southeast’s faculty and staff. He said within the $20.8 million budget need, there is a “pool of dollars” to invest in employee salaries and strategic projects.

Vargas expressed a sentiment of keeping the university strong by limiting cuts as much as possible, and revenue growth is what the university really needs.

“Our plan includes, among others, stabilizing enrollment, increasing retention, assessing allowable tuition increases and, in addition, generating revenues from new degree and non-degree programs, workforce training opportunities, and partnerships in new growth areas,” he said in the email.

University officials were not immediately available for comment.