Queen’s financial situation looks bleak unless drastic cuts are made in the operating budget, Principal Daniel Woolf said in a financial update to the University yesterday afternoon.
Woolf spoke to a packed room in Robert Sutherland Hall. The speech was broadcast in an overflow room in Ellis Hall and was also broadcast in Jean Royce Hall on West Campus.
Woolf said he will present strategies at the Board of Trustees meeting next weekend to get Queen’s operating budget balanced and will release the strategies after meeting with the Board.
Department heads have been asked to draft budgets for 2010-11, he said.
“It’s clear from these exercises that the concerns are very serious,” he said. “The situation is, frankly, approaching desperate.”
Woolf said the projected operating deficit for 2009-10 was $8.3 million, marking the first time in living memory that the University will face a deficit.
He said the provincial government won’t be able to bail Queen’s out of its financial woes because of its own troubles.
“While the provincial and federal governments are working to kick-start the economy with infrastructure projects … there’s no government relief in sight for university operating costs,” he said, adding that Queen’s has been awarded millions in capital funding for the new medical school building and performing arts centre.
Woolf said the three-year budget proposed at the Board of Trustees meeting on May 1 included annual operating deficits, resulting in a projected $33-million accumulated deficit in 2011-12.
The Board of Trustees accepted the 2009-10 budget, but only on the condition that they balance the books by the end of 2011-12 and shrink the annual deficit to zero by April 2012.
Woolf said the recession has had a major impact on the University’s financial state.
“Last year’s market impacted our endowments.” he said, adding that they were budgeted to add $5.4 million to the operating budget this year, but will produce about 20 per cent less.
“We continue to work hard on donations, but please , most are targeted,” he said. “People give to specific projects or initiatives, so we can’t rely on fundraising to solve our operating budget issues.”
Woolf said the University will turn to compensation, which includes salaries and benefits, to look for ways to reduce costs.
He said Queen’s University Staff Association, which consists of staff who do not teach, accepted a 1.25 per cent scale adjustment as part of a three per cent total compensation increase this year. There’s been a salary freeze for 2009-10 for senior staff and istration.
Woolf also discussed the University’s proposal to reduce two per cent in the negotiated faculty salary increase for 2011-12, which the Queen’s University Faculty Association declined.
Woolf said the Principal’s Innovation Fund is ing projects aimed at discovering new sources of revenue and reducing costs.
“For example, the French department is expanding the French Centre to offer more non-credit courses to help fund their graduate program,” he said. “Another proposal seeks to introduce 3-D mapping of campus buildings to help with space planning and energy efficiency.”
Woolf said he’s releasing a vision statement in January which will kick-start an academic planning process aimed at prioritizing measures taken by the University to curb budget cuts.
The plan, which will be drafted by University academics, will be presented at Senate next December and at next December’s Board of Trustees meeting.
Kelly Cole, Gender Studies Departmental Student Council co-chair and ArtSci ’10, attended the address. She said she thinks it’s important for students to remain informed on the University’s financial situation.
“This greatly affects the students of Queen’s and it affects the people who will come after us,” she said. Cole said she thinks some of the things Woolf said were necessary, even if they won’t be popular.
“I’m pleased with what I heard and what I might have brought up at faculty board, he addressed,” she said. “As much backlash as he might get, he listened to the input from the Arts and Science faculty board meeting.”
—With files from Gloria Er-Chua
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