Colleagues,

These past two months have been difficult and challenging for all of us. We are living in unprecedented times. Like me, I am sure each of you have heard from your colleagues in higher education about the challenges this pandemic has created at institutions across the nation.  

Below you will find information about how COVID-19 has impacted HSU’s already challenging budget situation along with strategies that will be utilized to reach an anticipated shortfall of $20 million.  You will see the first strategy is focused on students. With such a significant reduction, all areas of campus and each Division will feel financial impacts.

I appreciate the University Resource and Planning Committee for providing insights and feedback about this plan, and for continuing to keep students and fiscal sustainability at the forefront.

We have challenges along with many opportunities in front of us.

Thank you for all that you have done and will do in the future to support HSU’s students.

Douglas Dawes
Vice President for Administration & Finance

A Path to Fiscal Stability and Campus Vitality in a Time of Uncertainty

Due to significant financial pressures from declining enrollments, exacerbated by COVID-19, HSU must make major adjustments to its budget quickly to ensure ongoing fiscal viability.  HSU anticipates a significant decrease in enrollment for AY 2020-21 and a $20 million reduction to its budget over the next two years (See 2020-21 Scenario Planning and Budget Planning Scenarios - Deficit Ranges).  In planning for these reductions, an important tool will be the guiding principles developed by the URPC earlier this academic year.  COVID-19 has presented an unprecedented situation for higher education institutions across the nation and it is challenging, with the many variables at play, to project how enrollment trends now and in the future will play out.  At this time, more than ever, HSU will need to focus on recruitment, retention, innovation, and investment in new programs.

Each Division Vice President is charged with reducing spending and increasing revenue to reach the anticipated $20 million shortfall (See URPC Reduction Methodology @ $20M).  The following four core strategies will be deployed as needed by Vice Presidents in making adjustments in their Divisions.

Strategy 1: Maintain a STUDENTS FIRST focus and enhance programs and service delivery

Goals:

• Ensure programmatic offerings and resources are in place to support a high quality educational experience.
  
• Transform facilities to build community and places to connect, as well as co-locate student programs and services.
  
• Enhance service delivery and explore shared services opportunities. 
  
• Continue efforts to align student fees with student needs.
  

Implementation Strategies:

• Develop an Academic Master Plan to guide development and growth of the University’s academic offerings.
  
• Explore opportunities to enhance collaboration and coordination between student support units.
  
• Reimagine and reinvest in the student union facility.
  
• Continue to implement recommendations from the Student Fee Task Force Report.
  
• Limit reductions to budgets that support student employment.
  
• Pursue investments in programming for students or prospective students that acknowledge new challenges related to the pandemic and shelter-in-place rules. Identify opportunities and programs that fit with HSU’s strengths and set us apart from competitors in the CSU, State of California, and the world. 

Strategy 2: Align our staffing with the current reality of being a smaller University 

Goals:

• Prioritize recruitments based on strategic priorities and service to students.
  
• Strategic reinvestment in growth areas to strengthen programmatic offerings.
  
• Preserve jobs for existing employees, with the understanding that the overall workforce must be reduced.
  
• A fair and thoughtful approach for faculty and staff position vacancies.
  

Implementation strategies:

• Refill only a portion of the budgeted position vacancies that arise,including faculty, staff and administrators. Leaders must prioritize critical gaps and be creative in leveraging HSU’s workforce, in line with collective bargaining agreements, to ensure the University has personnel in place to meet the needs of our students.
  
• Implement Retirement Incentive Program(s).
  
•  Exploration is underway to determine feasibility at a campus level.
  
• Strategic reinvestment into growing high-demand and promising programs, as well as investing in new programs based on the identified priorities in the Strategic Plan, Enrollment Plan, and Academic Master Plan.

Strategy 3: Strategically fund allocations to mission critical activities and streamline processes and structures for work that must continue.

Goals:

• Reduce discretionary spending, freeing up resources to bridge spending reductions and support strategic reinvestment.
  
• Improve operational efficiency by focusing efforts on mission critical work.
  
• Consolidate departments/operations to achieve synergy and reduce duplication of effort.
  
• Streamline processes and structures to sustain core operations with smaller workforce. 
  

Implementation Strategies:

• Reduce OE budgets, allow divisions to roll forward 100% of unspent OE to incentivize only spending on essential costs. This allows areas to invest in promising programs and can support bridging gaps while working on reductions. (Reports of purchases above $500 will be shared routinely with VPs).
  
• Initiate a freeze immediately and through the next fiscal year on all non-essential facilities projects and work requests, except for those projects approved through divisional VP (See Essential Work Prioritization).  
  
• Initiate a freeze through the next fiscal year on all non-essential travel (See FAQs for Travel Restrictions). 
  
• Reduce the number of individuals who are issued Procards to reduce administrative support in reconciling and auditing.
  
• Centralize basic costs of doing business (such as telephone and network costs) and redistribute budget accordingly, saving the personnel time required to process internal transactions.
  
• Consolidate departments/functions, restructure to meet the needs of our campus and students.
  
• Utilize local expertise, where possible, to provide training and other consultative needs for campus.
  

Strategy 4: Enhance Revenue 

Goals:

• Expand availability of resources to support the campus.
  
• Diversify revenue streams.
  
• Expand partnerships with the community.
  
• Strategically invest in existing and new programs to bolster enrollment efforts.
  

Implementation Strategies:

• Continue to support and grow grant and contract generation.
  
• Create an ad hoc group to pursue pandemic-related recovery grants at the federal and state level, as well as through private foundations.
  
• Create and implement a plan for pursuing private charitable support in partnership with divisions and colleges, with a focus on areas of clear opportunity.
  
• Grow new and existing industry and government partnerships that are in line with the mission and values of Humboldt State University.
  
• Leverage system negotiated contracts for products and services.