The University of South Florida is putting the final touches on its budget for the 2021-22 fiscal year that starts on July 1. After preparing for significant cuts, the university is entering the year relatively unscathed.
“There was a huge pendulum swing with regard to revenues,” Will Weatherford, incoming USF Board of Trustees chair and former speaker of the Florida House of Representatives, said at a board meeting Tuesday. “This turned out to be a successful session for us relative to what it could have been.”
One of 12 public institutions in the State University System of Florida (SUS), USF receives most of its funding from the state.
Due to the coronavirus pandemic, this year’s legislative session was marked by fiscal uncertainty. Florida lawmakers returned to Tallahassee in March facing at least a $2 billion budget shortfall driven by a decline in state taxes and lottery funds.
“When COVID hit, we had to guess what our revenues were going to be a year in advance,” Weatherford said. “A year ago, we thought we had a $1 billion shortfall, then it turned into a $3 billion shortfall, and then a quarter later, it was back to a $2 billion dollar shortfall.”
As the state worked through those numbers, the Florida Board of Governors — which oversees the SUS — told universities to hold back 6 percent of their budget for the 2020-21 fiscal year, and to expect cuts of up to 8.5 percent for the 2021-22 year.
In response, USF announced a series of cost-cutting measures last October.
During this year’s session, the Legislature considered making recurring cuts to the SUS’ budget of up to $204 million. That would’ve resulted in a $27.4 million shortfall for USF.
But in the last 48 hours of the session, lawmakers reversed course.
“The contemplated cuts were very close to the finish line,” said Mark Walsh, USF vice president for government relations. “At that point, members of this board, the governor, and others intervened and asked the Legislature not to make those reductions.”
“They were receptive to that advocacy and moved forward and mitigated those cuts down to only the bottom line.”
Lawmakers only enacted an $18.5 million reduction to the SUS’ budget. That figure was based on the state’s contribution to the salaries of faculty members and administrators making $200,000 or more.
That means USF will have to make up an additional $2.45 million in salaries — a figure Walsh said is much more manageable than expected.
“That's the only cut of the reduction in the amount of state disbursements coming our way,” Walsh said. “But it does not require us to lower the salaries, we just would have to find a different source of funding."
USF will also need to increase spending to fulfill an extended proportion of the Florida Retirement System. In total, it will cost the university around $7 million each year.
However, university officials were not as concerned about that recurring cost.
“It's applied everywhere, it's a huge number for school districts,” Walsh explained. “Essentially, the Legislature has said ‘We have an imbalance, we're going to tax, in effect,’ although I probably shouldn't use that term.”
The school’s preeminence and performance-based funding remained unchanged.
Next year, however, Florida Polytechnic University will join the 11 other institutions receiving performance-based funding from the state. Walsh said USF’s share of the pot will likely decrease as a result.
Given the circumstances of the legislative session and the budgetary shortfalls for the state, university officials were satisfied with the end results.
“This was a tough year and it was moving,” said Jordan Zimmerman, outgoing chair of the Board of Trustees. “We didn't know where it was ever going to go. It was probably the toughest budgeting year ever for the State University System after (20)08.”
Tuesday’s board meeting was one of Zimmerman’s last as chairman. Weatherford will take on the position following his unanimous selection by board members.
Mike Griffin was also unanimously chosen to serve as the board’s new Vice Chair. Both terms are for two years and take effect July 1.
USF owns the broadcast license for WUSF Public Media.
