University News
SB 642/Cash Flow Update [5/11/10]
May 11, 2010
Dear Campus Community:
The Illinois General Assembly recently passed Senate Bill 642, which gives public universities short-term borrowing authority to deal with the current cash flow crisis. The plan gives Western and the other Illinois public universities included in the bill the ability to borrow for Fiscal Year 2010 payroll and other expense vouchers submitted to the state, but as yet unpaid by the Comptroller's Office.
The legislation, which still must be signed into effect by Gov. Pat Quinn, requires that universities submit an "Emergency Short Term Cash Management Plan," which includes the amount borrowed, the terms for repayment, the amount of outstanding state vouchers as verified by the State Comptroller's Office and the University's plan for expenditure of any borrowed funds. Universities would be required to pay back the loans within one year, and the borrowing requires Board of Trustees approval.
While borrowing would help Western and other institutions pay bills, this legislation is one that we reluctantly support, and is an option of last resort. We will take advantage of this borrowing option only if cash flow problems would prevent the University from meeting our payroll obligations and instructional obligations for our students.
At this time, the University is still expecting reimbursements from the State of Illinois totaling $19.7 million. While we did receive payments during the month of April, including $3.5 million from federal stimulus funds, we must still safeguard resources. We continue to work with the Comptroller's Office, our legislators and other university presidents and chancellors to resolve the cash flow delay and to advocate for FY'11 funding.
While the Fiscal Year 2011 budget has yet to be finalized, we fully expect that Western's actual funding level for FY'11 will be less than last year's appropriations. However, the budget reduction remains uncertain at this point. Because of the difficult fiscal year ahead, all vice presidential divisions have reduced their respective division's total budgets by 3.5 percent for Fiscal Year 2011. A complete list of proposed reductions can be found within each vice president's annual report at wiu.edu/strategicplan/strategic-plan.html. We will continue to keep the campus community updated about the FY'11 budget when further details are announced by the General Assembly.
As I have previously acknowledged, our primary goals are to provide quality, affordable academic programs and resources to our students and to keep all of our employees working.
I greatly appreciate your continued support.
Sincerely,
Al Goldfarb
President
Posted By: University Communications (U-Communications@wiu.edu)
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