The deans met with the president and provost this afternoon and we received an update on the state budget and the possible impact of the Federal Economic Stimulus Bill on the University. The new forecast for the state's budget deficit over fiscal years 2009, 2010, and 2011 is $4.57 billion, slightly better than the previous forecast of a $4.847 billion deficit for FY 2010 and 2011. That improvement stems in part from the cuts that the governor made this year and in part from $1.359 billion in new federal stimulus money coming to the state.
The federal stimulus funding includes $669 million that the state must use to support K-12 and higher education. This money comes with strings attached, including a requirement that the state maintain the University's base budget at its 2006 level: $591 million or $111 million less than the $702 million of our current base budget. The federal stimulus money can backfill much of that $111 million difference, although the money is non-recurring and so the University may face another budget gap in fiscal years 2012 and 2013.
Our college faces both a challenge and an opportunity here. The challenge, as I mentioned last week, lies in our needing to erase the $1.2 million structural deficit in our budget, and we will discuss with central administration next week how to meet that goal while minimizing its negative impact. The opportunity we have with the stimulus funding is that it can help buy us time to develop new revenue streams and put us on a more secure financial footing. The news today, in other words, was not as dire as I had expected, but it also reminded me that, when it comes to growing our revenues, we have no time to lose.