Indiana University is ahead of schedule cutting $23 million from its operating budget to match a four percent reduction in state funding. But debts created current by building projects has some university trustees worried about IU’s venture into the red.
Indiana University usually receives part of its money for building projects from the state. But with cuts in the state budget and nearly $200 million in IU building projects this year alone, the university will be taking on more debt than usual. IU has a plan to pay off those debts, but inflationary fears and other revenue concerns prompted worry-tinged questions from the university’s trustees Thursday. IU Treasurer MaryFrancis McCourt says the trustees need be ready for new pressures in balancing revenue and expenses in the coming years.
“We’ve had cash cows delivering very healthy, strong, consistent cash flows. Where we’re not going to be reinvest in those. And so now some of the cash will be coming off the table,” she said.
“ We’ve come through the short terms and the disaster of the last year in the overall economy. And the medium and long term pressures remain and maybe some of them have not yet unfolded.”
In its operating budget, IU has already achieved 40 percent of the cuts needed to close a $23 million state funding cut. They’ve done that through attrition and travel cuts. IU Vice President Neil Theobald says the gap should be closed by April.