Last week, the governor signed the higher education bill, which reduced the University's budget by 7 percent or $104 million. This week, the legislature adjourned without balancing the state budget. The Governor has said he will begin balancing the budget via unallotments after July 1.
The reduced University budget for the next biennium, the potential for additional unallotments during the next two-year budget cycle, and the impact of the state budget shortfall on our county partners all have a great impact on Extension's budget.
In preparation for the reduced University budget, I asked the Extension center associate deans, director of field operations and administrative units to prepare FY2010 budgets at 5 percent less than FY2009 budgets. In addition, we must look for additional cost savings in our operations. This may mean merging and closing some Extension regional offices. I am working with Lee Raeth, director of field operations, and regional directors in reviewing the current situation and determining the best process for making these decisions.
Because our county partners are also expecting significant reductions in the state aid to local governments, we know counties may be challenged to be able to continue to fund local Extension positions. We will be working closely with our county partners in the next months to determine the best way to continue funding for local Extension positions.
The next two years will be a challenging biennium for the state, the University, Extension and our partners. We have weathered many storms in the past, and I am confident we can manage this one if we work together and make the challenging choices necessary to sustain our programs in Minnesota.
I encourage you to use the Extension and the Economy website to submit your questions, comments or ideas. There you can find links to University budget messages and other resources and information.