Budget cuts continue

December 5, 2001

UW System instructional and research funding, but not administration, will be exempt from another round of state budget cuts this week.

Gov. Scott McCallum ordered state agencies to cut another 3.5 percent from their budgets for this fiscal year. With the reductions included in the 2001-2003 biennial budget and those announced earlier by the governor, the additional cuts mean most state agencies will have had their budgets reduced almost 10 percent for the biennium. The governor indicated that the savings from the measures ordered to date are expected to be about $60 million.

McCallum’s UW System cut translates into about a $4.2 million reduction, though it is unclear what individual campus allocations will have to cut. The reduction will not directly affect student services or academic programs but will be applied to other operations.

In addition to the partial exemption for UW System, educational funding, public health and safety functions, and SeniorCare, the new prescription drug program for seniors, are also exempt from the cut.

Additional budget changes for the second year of the biennium (July 1, 2002-June 30, 2003) are “yet to come,” McCallum says.

Current cuts and the state hiring freeze are being done by administrative action, but additional state spending reductions will require legislative approval. The governor is expected to call a special session of the Legislature after the first of the year to rewrite the state budget for fiscal year 2003.

The governor has said the overall budget deficit for 2001-2003 stands somewhere between $300 million and $1.3 billion, and has recently acknowledged that the deficit will likely be closer to the higher estimate.