PHOENIX — One month after revealing that the University of Arizona was burning through cash at an alarming rate, President Robert Robbins announced several steps Wednesday to address what the former heart surgeon called "the disease" - the university is spending more money than it's making
Speaking at a special meeting of the Arizona Board of Regents, the governing body for the state's public universities, Robbins acknowledged: "We do not know the full scope of this issue yet."
Chief financial officer is leaving
Robbins announced that the university's chief financial officer, Lisa Rulney, is resigning, one month after disclosing the financial crisis to the Board of Regents. The board's executive director, John Arnold, will serve as interim CFO. Arnold is a former budget director under Gov. Jan Brewer.
Rulney reported in early November that the university had forecast 156 days worth of cash on hand at the end of the 2023 fiscal year on June 30, but the school had just 110 days of cash reserves.
“Our financial health is fragile,” Rulney said at the time.
The Arizona Board of Regents required 140 days of cash on hand on June 30.
Budget cuts in the works
Here are the bullet points from Robbins' presentation:
- Budget cuts are in the works for the fiscal year that starts on July 1, 2024
- Planned salary increases in the new fiscal year will be delayed
- Hiring and international travel are frozen
- Purchasing is being restricted, non-essential capital projects deferred, and strategic investments paused
"I promised all of you that I would dig in and I've dug in. And I don't like everything that I've discovered," Robbins said.
'What we are not doing'
Robbins also sought to quell rumors by listing "what we are not doing."
- "We will not reduced need based aid for Arizona students. I cannot state this strongly enough. We support the Promise program, and we will continue to provide that support."
- "We will not reduce aid of any kind to currently accepted qualified students."
- "We will not reduce retirement benefits."
- "We will not institute furloughs and we will not jeopardize our teaching and research missions."
Fallout from financial bombshell
For several weeks, Robbins has been dealing with the campus fallout from the financial bombshell.
"It was alarming to hear the presentation out of the blue, a total surprise to us," Dr. Leila Hudson, a professor at U of A for 26 years, said in an interview before the regents meeting.
She leads the Faculty Senate, which has worked with Robbins on a rescue plan.
"We have a management problem," Hudson said, "and we can solve it."
Athletics problem is 'vexing'
Here are the problems and some of the solutions:
- The shocker on campus was the $87 million in loans to the Athletics Department. Employees will be laid off, according to Robbins, and ticket prices will increase.
- Lucrative financial aid packages to lure the country's best students to Tucson ballooned under Robbins - they're being scaled back.
- The purchase of an online school added $270 million in operating costs this year. That's a work in progress.
"Athletics is the most vexing problem for me to come up with a plan for," Robbins told the Faculty Senate last week.
He told the regents Wednesday: "We are committed to putting together a multiyear plan in place to bring their budget into balance."