University System of Georgia Chancellor Hank Huckaby has ordered the organization’s fiscal affairs staff to cut all universities’ budgets by 3 percent to meet a reduction request from Gov. Nathan Deal.

His statement to Georgia Universities:

Georgia has faced unprecedented financial challenges in recent years as a result of the national economic recession. The University System of Georgia has managed through these difficult times while continuing to focus on service to students and maintaining quality. While revenues are expected to grow moderately in the months ahead, the basic needs of the state also continue to place new demands on limited funds.

The Office of Planning and Budget released the Governor’s instructions for the preparation of the Amended Fiscal Year 2013 and Fiscal Year 2014 budgets on July 23rd. The instructions require each agency, department and authority to submit State General Fund reduction plans of 3% for both years. The System Office shared these instructions, as well as guidance for preparing internal reduction plans, on July 23rd.

Governor Deal’s approach to the budget is to make state government more strategically focused and accountable for performance. The expectation is agencies will identify low-priority or under-performing programs and eliminate these programs and/or rethink service delivery. The Governor’s instructions encourage targeted requests and reductions rather than broad, across the board reductions.

I have spent time reviewing budget reduction plans with internal staff. In some cases, plans reflect the strategy outlined by the Governor, which include identifying low-priority programs for reduction or elimination. Unfortunately, a number of plans simply offer to return allocated funds that were deemed to be high priorities or continue the practice of cutting a little from all programs. In the days ahead, Fiscal Affairs staff will be in touch to discuss plans that fail to adhere to previous instructions.

In the meantime, we must face the reality that the 3% reduction required in the Governor’s budget instructions will be needed to meet statewide needs and balance the state budget. Therefore, I have asked Fiscal Affairs staff to take action to reduce all institution budgets by 3%. Adjusting the budget now will give each institution a clearer picture of their budget and allow for proper budget management throughout the year – as opposed to taking a wait and see approach that runs the risk of overspending. In the event State General Funds are not reduced by 3% or are only partially reduced, we will address these funds again during the allocation process in the spring.

Effective immediately, please manage to your revised budget. Further, I encourage you to closely monitor expenditures and conserve where possible in the event state revenues and expenditures should change.
Thank you for your continued efforts during these difficult times.