WILLMAR -- State budget problems have already hit Ridgewater College, and the worst could be yet to come.
Reductions of nearly $900,000 were already made for fiscal year 2010, which started on July 1. However, deeper cuts are expected in fiscal years 2011 and 2012. College President Douglas Allen said the school has been able to avoid layoffs so far, and he hopes to avoid that as much as possible.
"You basically are trying to decide what you're not going to do anymore," Allen said. "It all has value."
State budget shortfalls have led Gov. Tim Pawlenty to use his executive powers to cut appropriations over the next two years. It's possible even deeper cuts could be made in the Minnesota State Colleges and Universities system in future years.
Federal economic stimulus funding will help cushion the blow for the state's colleges, but that will only last for two years.
The college will receive about $1 million in stimulus funds for this year. It will be used to offset some tuition increases, to fund early retirement packages and to make some facility improvements on the Hutchinson campus.
When the stimulus money runs out after fiscal year 2011, the college could lose another $1 million in revenue.
"It's not a rosy picture," said Sam Bowen, the college's marketing and communications director.
"We can't take anything off the table," Bowen said. "Our guiding principal is to accomplish our goals without sacrificing service to our students."
The college has announced that the Small Business Management Program will close after the next school year.
Vacant faculty and staff positions have not been filled, resulting in some larger class sizes and additional duties for the employees who remain. Staff members have cut spending wherever they can.
Allen said he doesn't anticipate more cuts during fiscal year 2010, which will end on June 30, 2010, but that's not certain. Those decisions will be made this fall after the traditional school year begins, Allen said.
Higher enrollment -- good news for the school with campuses in Willmar and Hutchinson -- could compound the college's budget challenges.
"At the point where you have the greatest number of students, you have the least amount of money," Allen said. Enrollment is projected to continue to rise for the next few years.
Students will notice that tuition will increase by $7, to $143.43 per credit. Tuition for online courses will be $177.54.
Information from the MnSCU Web site projects that the college's revenue from tuition will increase from $13.5 million last year to $13.9 million this year.
The college plans to focus on its own local goals while also working toward the budget goals set by the MnSCU board, Allen said. For example, Ridgewater will continue to develop new initiatives and to look for ways to serve under-represented student groups, he said.
The budget-cutting exercise has highlighted the "interrelationship of things," he said. "Everything you touch touches something else."
Though a common suggestion is to cut administrative costs, administrators make up about 6 percent of the school's employees. "I really feel like we're running a pretty lean ship," Allen said.
Some employees will lose their jobs with the program closing, and some positions will remain vacant, he said.
Allen said an early retirement incentive program being designed by MnSCU may lead some long-term faculty members to retire. While he didn't look forward to losing experienced instructors, he said, the potential savings on salaries could help the budget.
The school has a general operating budget of $31.9 million this year. Of that, $24.5 million goes to salaries.
Allen said he is proud of the response from Ridgewater employees.
"When we did not fill positions, they stepped up to the plate" to continue serving students, he said.
In trying to control expenses, the administration did not make an across-the-board percentage reduction. Because some departments have more flexibility in spending than others, he asked that everyone do what they could to cut back, he said.
"I think people have been real responsible about reducing expenditures," Allen said.
Some class sizes may be larger as a result of the tighter budgets. Some smaller classes, those with less than 10 students, for example, could be canceled.