In a letter addressed to the campus community earlier this month, University of Massachusetts Chancellor Robert Holub said the state’s flagship public university will likely receive approximately $18 million less from the Commonwealth in fiscal year 2012 than it did in 2011.

Holub wrote that, as federal stimulus monies from the American Recovery and Reinvestment Act (ARRA) expire this fiscal year, and with Massachusetts facing a structural budget deficit of about $2 billion, “we do not anticipate anything more than a flat budget from the state for the coming year.”

Such a budgetary situation, Holub continued, would result in the University receiving $18 million less next year than it did this year from Bay State legislators, and would translate to $35 million less than UMass received when Holub took over in 2008. Further, as UMass is receiving significantly less stimulus money than it did last year, the total impact on the budget could be “a decrease from last year’s allocation and stimulus funding of almost $30 million.”

If University financial officials’ predictions prove true, UMass Amherst would receive $196.1 million next year from Beacon Hill, down from $215.1 million this fiscal year. In the last year of stimulus dollars, UMass will receive $18.7 million in ARRA funds, about $11 million less than it got last year.

Further complicating the school’s finances will be $2 million in salary increases it will be required to pay out to faculty and staff due to renegotiated collective bargaining agreements. These increases have already been built into next year’s budget, according to Holub’s letter.

The vastly reduced allocation and newly-mandated salary increases mean the school may have to seek either sweeping revenue enhancements or whittle away at existing programs to bridge the gap, which represents some eight percent of the school’s current allocation.

In the letter, Holub outlined steps he and his administration plan to take to alleviate the crunch. As University planners anticipate no new public revenue sources, he said, “the only increase in our budget will come from what we generate ourselves in revenue.”
Holub stated that “by the end of this year, we will have generated over $10 million in new revenues, which mitigates the impact of budget reductions this year and in the future.”

The letter makes no specific references to where on campus these cuts may be felt, and while tuition hikes might be one obvious answer to patching up such a large hole, the UMass system’s Board of Trustees voted last spring not to increase tuition.

Despite the somber news, Holub said there were reasons to be pleased with the school’s progress since his tenure began.

“We are progressing on the completion of two new science buildings adjacent to the ISB,” the Chancellor wrote. “Our marching band building is nearing completion and should be ready for operation this spring,” he continued, “the new police facility will be ready for occupancy in late February, and the removal of our campus security personnel from Dickinson Hall will allow us to initiate a series of moves that will secure new homes for a number of units that desperately need facility upgrades.”

Sam Butterfield can be reached at [email protected].