SIUE loans SIUC up to $35 million
Trustees for Southern Illinois University unanimously approved a loan up to $35 million from the Edwardsville school to its sister campus in Carbondale, but with some of the restrictions requested from SIUE faculty.
The SIU Board of Trustees had postponed the April vote on the controversial loan from the Edwardsville campus’ reserve fund to bail out Carbondale, which had gone through $83.3 million in reserves from its own campus and the Springfield medical school and faced a possible deficit as early as this month.
Without a loan from the SIUE reserves, Carbondale faced tapping into restricted money from grants and bonds — a choice that President Randy Dunn said is legally questionable and could lead to default status on bonds and audits.
SIUE faculty and staff voiced reservations about lending some or all of its $70 million in reserves since the Edwardsville campus has enacted round after round of budget cuts to stay ahead of the state’s budget problems and lack of appropriations over the past few years. The SIUE Faculty Association sent a letter this week to university officials and the board of trustees outlining their concerns, which they also forwarded to the governor’s office and several state legislators.
We take our responsibility as an economic linchpin in the metro-east seriously, but even more important is our responsibility to our students, their families, and the community, that their investment in the future of Illinois is well-placed with us.
SIUE Faculty Association
The unrestricted reserve money is in essence an emergency “rainy day fund” for the campuses, according to university officials. The reserves cannot be used for general operating money or to pay an expense that is permanent and recurring, such as employee raises.
SIUE is in the process of cutting $4 million from its budget on top of a 9-percent budget cut already implemented. In recent years, SIUE has cut $12 million from its budget and increased its contingency funds from 5 percent to 25 percent. Faculty members gave up phones in their offices, lost teaching assistant and graduate assistant positions and allowed class sizes to grow.
Meanwhile, faculty have gone without raises for four years, and some full-time tenure-track professors with doctorates are earning less than $45,000, which is well below similar university salaries at other institutions, according to the faculty association.
“Add to the above facts that we are forced to pay for health insurance that many of us can no longer use because providers won’t see state employees anymore,” read a letter from the faculty association to the SIU administration and the board. “‘Demoralized’ is too weak a term.”
The letter stated that SIUE students are upset that their fees are going to SIUC instead of the projects at their own campus which will have to be delayed without the reserve money. “At the last board meeting, there was approval for new football jerseys at SIUC while SIUE students are having classes in ill-suited or deteriorating spaces with defunct equipment, picking their way around unfinished construction sites on campus, and being told there is no funding for certain academic projects and events,” the letter read.
However, the faculty association stopped short of asking the trustees not to approve the loan. “We stand in solidarity with the Carbondale faculty and support them in their time of need,” the letter read. “The faculty at SIUC are not at fault. The fault here is with past leadership at both the state and university levels, who turned a blind eye and made poor choices.”
Instead, their previous statements and the letter sent this week asked them to explain “thoroughly and unequivocally” how much SIUC intends to borrow, exactly when it will be paid back, and what changes will be made on the Carbondale campus to prevent further financial problems.
“We take our responsibility as an economic linchpin in the metro-east seriously, but even more important is our responsibility to our students, their families, and the community, that their investment in the future of Illinois is well-placed with us,” the letter read. “If we at SIUE allow even our sister campus to infringe on our viability for the duration of this budget crisis, we risk breaking our social contract with the region and with our students. That is unacceptable.”
In a newsletter sent to all SIU employees Wednesday afternoon, Dunn promised that specifics would be part of the proposal before the trustees. “In response to the many concerns raised by individuals and constituency groups on the Edwardsville campus, the recommendation in front of the Board this afternoon will set a borrowing cap as well as codify the pledge that the first obligation on the replenishment of funds from SIUC will be to SIUE once a state budget is in place,” Dunn wrote.
In the final proposal approved by the board Wednesday evening, Carbondale is authorized to borrow up to $35 million, or approximately half of SIUE’s reserves. At whatever point the state of Illinois finally authorizes a full annual appropriation to Southern Illinois University, repaying the loan to Edwardsville’s reserve fund will be Carbondale’s top priority, according to the resolution.
The board was in executive session for three hours prior to the vote. They also heard from several speakers from both campuses, mostly on the issue of the loan. Jeffrey Sabby, president of the SIUE Faculty Senate, said he was grateful that their voices had apparently been heard and some of the issues from the original proposal addressed, such as a specific dollar amount for the loan and terms for its repayment.
SIUC Faculty Senate President Kathleen Chwalisz Rigney said she was troubled by the portrayal of Carbondale as ignoring the financial crisis it faces. She said Carbondale has lost 20 percent of its employees in the last 10 years, and the remaining staff are filling in for that work. “We are all in the same position,” she said. She added that SIUC is the “primary employer and cultural hub in the rural southern Illinois region.”
David Johnson, president of the SIUC Faculty Association, said he does not believe the problem is with mismanagement at Carbondale, but a reflection on nationwide issues facing higher education such as declining state support and lower enrollment. The exceptions, he said, are universities in “growing urban areas like the metro-east.”
“Our deadbeat state government, as we all know, has basically stopped funding higher education,” Johnson said. “There are powerful people in our society who want to end public higher education or are at least indifferent to it... Whenever we say that one campus is poorly run or disposable, we play into their hands. And yes, when we ask a sister campus to shed its identity as a research university to find a new niche, we are playing into their hands.”
Johnson said the campuses must work together in solidarity to survive what he called “the greatest challenge to higher education in our lifetimes.”
After the vote, SIUE Chancellor Randy Pembrook said he thought the delay gave more people a chance to voice their opinions. “I think everybody is hopeful that the state will pass a budget... and this conversation will be very different,” he said. “We’re part of a system, and it’s important to be a player in the system.”
Dunn said technically, all the money is under one system, but it was to the trustees’ credit that in the interest of transparency, they wanted to be clear on what was going to take place.
Trustee Amy Sholar, who is from Madison County, said she understood the concerns of SIUE faculty. However, she reiterated the theme of one university system united. “If one fails, we all fail,” she said. “I am a system-wide trustee, as is every trustee on this board... All of us understand these concerns and reservations. But in order for us to survive and thrive in this very difficult time, we have to survive as a system.”
In other news, the board opted to table the vote on a new chancellor for SIUC. President Randal Thomas said the board discussed the recommendations of the search committee extensively, but opted to go back to the list of finalists and interview all five candidates themselves before making a decision.