Budget: Where U.Va. stands
Process a long and winding road
By Dan Heuchert
news about the state budget seems ever-changing. One governor
proposes a budget; the next one changes it. Then legislators rewrite
the budget altogether. Numbers shift constantly. One day, you
may be getting a raise. The next day, youre not. Then its
not a raise, but a bonus, or perhaps some time off. It can be
from Colette Sheehy
for Management and Budget
Everyone in the state will feel the results of the difficult
budget decisions that lawmakers are grappling with in Richmond.
The University is no exception.
deliberations are often complex and, because of the nature
of the legislative process, details are changing by the
Difficult times that result from decreasing state revenues
are not new to the University. We have weathered them before
and emerged stronger and wiser.
Office of State Governmental Relations monitors closely
the issues that will affect the University and is working
hard to keep the interests of the University and its employees
before state legislators. And our managers know more in
2002 about how to deal with declining state resources than
they knew in 1990.
is important to remember that in 1990, 33 percent of U.Va.s
Academic Division operating budget came from state tax appropriations.
Currently, this figure is 21 percent. In 1990, 13.5 percent
of total University revenues came from gifts and endowments.
Now the figure is 15.4 percent. So the base that the state
cut is relatively less than it was in 1990.
used tuition throughout the early 1990s to offset some of
the impact of the cuts in state money, and we are pleased
that the legislature has returned the authority to set tuition
to each Board of Visitors. Our board will be able to consider
the best pricing policy for our institution and student
body. Tuition will again serve as a cushion against the
full impact of the budget cuts.
administrators share everyones concern about the situation
we face. We realize that we have to manage to the reality,
including the reality that staff and faculty have suffered.
I want to reiterate here that the goal of the University
administration is to protect present employees above all
Casteen recently summed up the situation that reflects what
many of us in the administration believe. I dont
expect the next couple of years to be easy, he said.
At the same time, I expect that the University will
continue to outperform the state. It seems to me that this
is the lesson of the last decade and the best hope
for the next.
are like sausages, the late German Chancellor Otto von Bismark
once said. It is better not to see them being made.
With apologies to the squeamish, then, what follows is a primer
on Virginias budget process, with an eye to salary matters
as an example of how things change in the process.
operates on a two-year budget cycle. In even-numbered years, the
General Assembly meets
for a 60-day long session to consider a 24-month spending
plan, to take effect July 1, the beginning of the states
fiscal year. In odd years, the legislature generally meets for
45 days, and makes midstream adjustments to fit the more current
financial picture. Lawmakers also may modify the expiring budget,
if need be, with so-called caboose bills that take
effect as soon as the governor signs them.
budgeting, either writing a new one or amending an old one, is
a nearly constant process. Each fall, the University submits its
budget priorities developed through an extensive internal
process to the state Office of Management and Budget. These
include requests for both operating needs and capital (building)
projects, the latter of which are enumerated in a six-year plan
that is updated every other year.
state budget office, working in concert with the governor, reviews
the states revenue projections and puts together a budget
proposal, which the governor usually unveils in December. At the
close of 2001, outgoing Gov. Jim Gilmore did the honors.
proposal, which included a 2 percent raise for state workers,
was immediately panned as unrealistic for many reasons by legislative
leaders and then-Gov.-elect Mark Warner, all of whom had their
eyes trained on a mounting revenue shortfall, thanks in part to
Virginias recession-swamped economy.
Gilmores budget was introduced as the plan of record when
the 2002 long session opened Jan. 9. It was referred
to the legislatures powerful money committees,
the state Senates Committee on Finance and the House of
Delegates Appropriations Committee. There, the sausage-making
began in earnest.
took office and submitted his own package of budget amendment
proposals, which included a salary freeze for state workers, including
members submitted amendments of their own. Even as the committees
worked on the budget, fresh revenue projections forecasted a growing
deficit: $1.3 billion for the remainder of the current fiscal
year, and $2.5 billion for the two-year cycle beginning July 1.
capital budget process has gone fairly smoothly. Early in the
session, both committees agreed to a $1.6 billion bond package
to finance construction at the states colleges, universities
and parks. Almost $1 billion of that would have to be approved
by voters in a referendum, presently slated for November. U.Va.s
share would be $98.2 million, $68.3 million of which would go
before the voters.
money committees finally completed their work on the operating
budget Feb. 17 and sent their versions to their respective full
houses. The Senate considered its version for only two hours Feb.
21 before voting 34-6 to approve; the House debated into the night,
voting on dozens of amendments before finally approving its version
by an 81-15 vote.
House bill provides for a 2.5 percent across-the-board salary
increase in December 2003, as long as the revenue picture gets
no worse. The Senate went a different route, scheduling one-time
bonuses of 2.5 percent and 2.0 percent in the coming two fiscal
years; alternately, classified employees could choose to receive
two weeks of additional paid annual leave instead. In the
Senate plan, institutions could be given discretion as to how
they would dole out the bonuses to faculty members.
houses were expected to formally reject each others budgets
Wednesday, sending their competing versions to an eight-member
conference committee, expected to be comprised of senators John
Chichester (R-Fredericksburg), Charles Colgan (D-Manassas), Walter
A. Stosch (R-Glen Allen) and William Wampler (R-Bristol), and
delegates James H. Dillard II (R-Fairfax), A. Victor Thomas (D-Roanoke),
Lacey E. Putney (I-Bedford) and Vincent F. Callahan Jr. (R-McLean).
Their task is to come up with a compromise measure to be approved
by each house in time for the assemblys scheduled March
will have 30 days to review the budget passed by the legislature.
In Virginia, governors are empowered with a so-called line-item
veto, which allows them to red-line certain elements of
the budget without vetoing the whole bill.
The Assembly reconvenes April 17 to consider Warners vetoes.
It takes a two-thirds vote of each chamber to overturn a gubernatorial
new budget will then take effect July 1 just a few months
before the University submits its proposed amendments for consideration
by the governor and the 2003 General Assembly.