Governor's Budget Proposal for 2008–09

Members of the Rutgers Community:

Yesterday, Governor Corzine announced his fiscal year 2008–09 budget proposal. It is, in his words, “a very tough budget,” which calls for steep and widespread funding reductions and the elimination of three state departments.

Rutgers does not yet have the full details of the budget proposal and its implications for the university. But we know that higher education shares in the sacrifice called for in the governor’s budget. Overall funding for higher education, which combines operating support, benefits, student aid, and capital, is down 3.5 percent. One of these funding streams, direct operating support, appears to be down by an average of 10.7 percent for all four-year public institutions, and $38 million—or 11.6 percent—for Rutgers. Our slightly higher percentage drop relates directly to our higher share of out-of-state students; the budget imposes a penalty based on the number of out-of-state students enrolled at each institution.

This reduction is offset to some degree by other parts of the governor’s budget. For example, Tuition Aid Grants will rise by $15 million statewide, and the Educational Opportunity Fund (EOF) Program, which helps students from economically and educationally disadvantaged families and communities, is kept level. Both these recommendations are welcome and consistent with the governor’s stated concerns about maintaining access to higher education. The budget also contains $38.5 million to cover some of the cost of salary increases at Rutgers and other four-year public colleges and universities. While we do not yet know the allocation of this salary money among the institutions, it will help to fund a portion of our commitment to salary increases in the coming year.

This budget is hardly good news for Rutgers, but it is the reality of an extremely difficult financial climate, and it reflects the governor’s determination to address New Jersey’s severe fiscal problems and to begin laying the foundation for long-term financial stability. Such stability is essential if the state is ever to meet its commitments to higher education.

Next steps for our university community involve addressing some uncertainties, such as whether there is the possibility of some restoration, how we will manage the impact of the final budget, how tuition may be affected, and what the governor’s announcement of a new early retirement program will mean for Rutgers.

These uncertainties do not come with easy answers. The proposed budget is of great concern because of the hardship it would cause for our students, faculty, and staff. We will need to call upon the remarkable resolve of this community—and the creativity and teamwork I have witnessed in surmounting so many challenges—to keep Rutgers on the ambitious path we have set for it.

The governor’s proposal begins a legislative process that extends through June. Please know that Rutgers will continue to work with the governor and the legislature as they develop a final 2008–09 budget that recognizes the fiscal challenges while preserving the excellence of public higher education in New Jersey.

Just as important, we as a university will need to engage in discussions of the budget’s potential impact within our campuses, schools, and offices in the coming months. We will seek your input and suggestions in planning how best to manage our resources as the state budget process unfolds between now and the start of the new fiscal year on July 1.

Richard L. McCormick
President
Rutgers, The State University of New Jersey