The University of Wisconsin System announced Aug. 11 an untold number of employees would be laid off over the next two years resulting in a total of $10 million in budget cuts.
Interim System President Tommy Thomson announced these cuts will reach across UW System Administration only.
Each school in the UW System is experiencing internal budget cuts as well due to COVID-19.
“I can’t tell you exactly where the rest of the cuts are going to come from, but I can tell you we will do what is necessary to comply,” Thompson said to NBC15. “We’re arguing right now over the size of the further cut put out by the administration.”
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According to NBC15, the UW System administration will experience a $6 million cut in salaries. Gov. Tony Evers’ administration projected that the state budget would face a $2 billion cut due to the current pandemic.
Evers previously ordered a $49 million budget cut this year, and in the most recent order Evers added another $250 million budget cut to all state agencies. This includes UW.
UW spokesperson Meredith McGlone spoke on the financial impact to the university.
“In terms of the financial impact to UW–Madison, Chancellor Blank has stated that it is expected to be at least $150 million, and that estimate predated the postponement of fall athletics,” McGlone said.
UW’s budget before COVID-19 for the 2021 fiscal year was expected to be $140 million, according to Senior Associate Athletic Director for External Communications, Justin Doherty.
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With the UW football season and other fall sports postponed the budget took a hit.
“I can’t speak for the university as a whole but, for the athletic department, a cancellation of the entire athletic year would mean revenue losses in the neighborhood of $130 million,” Doherty said.
The Big Ten announced the league will be postponing the fall season, publicizing this announcement on the same day UW released the news about their budget and salary cuts to internal administration.
These cancellations and postponements of sports and other activities come from health and safety concerns due to COVID-19, so it is uncertain whether or not this revenue will be recoverf later in the fiscal year, should a postponed season come to fruition.
Thompson identified administration salaries as an area for cost reduction. These savings will help fund scholarships for underserved and underrepresented populations of students who are attending or want to attend UW.
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“About half of the $10 million in savings will be put toward a new scholarship for underrepresented and under-served students,” Thompson told NBC15.
Along with cutting system administration salaries, Thompson plans to also limit out-of-state travel, eliminate several constly memberships and subscriptions and meet virtually for future UW System administration meetings to save more dollars.
Each of the 13 universities in the system have their own plans for cost-cutting that Thompson was unable to comment on in the press release, as these current plans affect the UW System administration only.
“These budget reductions are designed to streamline our operations and ensure the UW System Administration can come out of the pandemic stronger by focusing resources on students,” Thompson said in the press release.
While these budget cuts total around a 10% reduction in current administration salary, they all directly resulted from the economic conditions caused by the pandemic, so it is unclear how the UW System will proceed in the future.
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In the press release, Thompson said these cuts were made to ensure that all 13 schools within the UW System come out of the pandemic even stronger.
“To be the University’s biggest advocate and toughest evaluator, I will be directing my leadership to identify administrative savings now while championing investments for underrepresented and underserved populations,” Thompson said in the press release. “We are setting priorities in the face of difficult financial times.”