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UFF Biweekly
United Faculty of Florida -- USF System Chapter
10 October 2013
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Chapter Meeting Tomorrow Noon on USF Tamp in EDU 161

The Chapter will meet tomorrow Friday at 12 noon in EDU 161. The schedule for the rest of the semester is:

  • On the Fridays of October 11, November 8, and November 22, at 12 noon, we will meet on USF Tampa in EDU 161.
  • We will meet on Friday, October 25 at 12 noon on a location TBA on USF Sarasota / Manatee.
As always, there will be sandwiches, chips, and soda. All USF UFF employees, members and non-members, are invited: come and bring a friend!

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IN THIS ISSUE

Report on the UFF Senate Meeting, Part II: University Budgets (First of Two Reports)

USF is apparently facing a fiscal crunch, so it was very helpful that at the UFF Senate meeting last month, there was a workshop on university budgets - led by Leroy Dubeck, who looked at USF's finances during the previous crisis in 2009. So we look at USF's financial statements - but first, we launch a new series featuring UFF members.

  • Valerie Janesick tells us Why I am a union member as a tenured full professor. Professor Janesick is a member of the Department of Educational Leadership and Policy Studies, and for more, see below or click here.
  • Background on the Budget. USF's Senior Vice President for Business and Finance, John Long, warned the USF Tampa Faculty Senate that if USF did not rebuild its cash reserves, USF's bond rating could get dinged, which would cost USF millions of dollars annually. For background, see below or at click here.
  • Leroy Dubeck on University Finances. Professor Dubeck reminded us that the place to find out what is happening is not the budget, but the financial statements. For more, see below or click here.

Why I am a union member as a tenured full professor

By Valerie J. Janesick, Ph.D.

Over the course of my career in academia, I have always been a union member. As a union member you are never alone in terms of support and solidarity. Collective bargaining was fought over bitterly throughout the history of the USA and leaves us a profound legacy to negotiate over working conditions, compensation and benefits. Being a union member gives us identity, and is the last vestige of standing up to corporations and their venal and meretricious corruption and greed. The attempt to erase the individual in the work conditions equation and deprive workers of fairness in the workplace is folly and unions fight for individuals and for basic ethical treatment. The best investment is investment in union protection.

Background on the Budget

On August 14, President Genshaft sent a letter announcing that the USF Administration planned to replenish depleted cash reserves while adjusting to a "new normal." "Please be mindful that the restoration of our cash reserves is imperative to protect the USF Systemís excellent bond rating," she wrote, and, "Working together we can chart a course for a secure and promising future for the USF System, our outstanding faculty, staff and students." However, the USF Council of Chairs did not feel invited to the process, and wrote a letter to President Genshaft and Chief Operating Officer John Long protesting that they had not received a sufficient information on the situation: "To date, we have not received a documented explanation of the need for the extent of the cuts ..."

USF is not the only institution facing this situation, and last summer, the American Association of University Professors issued a Statement on the Role of the Faculty in Conditions of Financial Exigency, warning that "... many current 'crises' represent shifts in priorities rather than crises of funding." The AAUP warned that financial problems are often used as a rationale for curricular and programmatic changes without proper vetting, and claimed that "Discussions of a campus's financial state cannot be fairly or responsibly conducted without faculty consultation about budgetary priorities."

The USF Administration is not claiming financial exigency - the Administration is announcing steps intended to prevent USF from getting into trouble. According to the Administration, the immediate problem is that USF's cash reserves are depleted, and the USF Tampa Senate was informed that replenishing USF's reserves entails a $ 9 million from Academic Affairs. Failure to do so would likely affect USF's bond rating and cost USF millions annually.

But it is not clear what this means. Bond ratings are issued based on the perceived likelihood of partial or total default. "Cash reserves" are only part of the picture that the rating agencies look at. So what is that picture - the financial standing of USF - and how do cash reserves fit in it? It would probably be helpful if the senates (plural) were given outlines of what is meant by "cash reserves," what USF's cash reserves are and have been (the phrase "cash reserves" does not appear in USF's recent financial statements), and why they are important and to whom. And the senates (plural) should be in the loop for determining budgetary priorities.

Provost Wilcox responded to the Chairs, announcing how the Administration decided to apportion cuts (with no apparent faculty input) and presenting a table of current and recent expenditures. But he outlined the cash reserves issue only in broad and qualitative terms. The Tampa Bay Times ran a story on the chairs and Wilcox. Meanwhile, we turn to the bigger picture of the financial situation of USF.

Leroy Dubeck on University Finances

The last time the budget was a hot topic was 2009, when UFF, the USF Faculty Senate, and the USF Student Government invited Leroy Dubeck to look at the USF budget. On 22 January 2009, Dubeck told a large audience in the Marshall Center that a budget was a plan for what an institution planned to do, while a financial statement was an account of what that institution actually did do.

Here is how it works. The USF Board and the USF Administration prepare a budget - and past budget proposals are posted online - for the coming fiscal year (typically July 1 to the next June 30). This is what the Board and the Administration would like to do. At the end of the fiscal year, the Administration compiles a report and sends it to the Florida Auditor General, who then conducts an audit and posts it online - early the following year. USF also posts these reports; the latest one is the report on the fiscal year 2011 - 2012.

In January, 2009, the 2007 - 2008 report had not been posted yet, so Dubeck looked at the 2006 - 2007 report. The 29 January 2009 Biweekly gave an account of his presentation, where he described USF's 2007 audited statement. Readers may recall that he pointed to $ 240 million in "unrestricted net assets," and readers may recall that after much back and forth, some of these "unrestricted net assets" were used to protect USF.

Fast forward to the UFF Senate meeting last month, and Dubeck was there, describing how to look at financial statements, and telling stories of colleges that squirreled away assets and pled poverty while bargaining salaries or during controversies over layoffs. And occasionally, ahem, a board or administration would mismanage funds. Unions and concerned faculty, claimed Dubeck, should keep an eye on university finances. Then he went over some details, so let's apply his methods to get a rough idea of how USF is doing.

The basic formula is assets minus liabilities equals net assets. For simplicity, let's look at the university itself and not "components" (like the USF Foundation), even though Dubeck said that a thorough analysis would include components. In this issue, let's look at the same assets that Professor Dubeck looked at last time: "unrestricted net assets."

Recall that after subtracting liabilities from the assets, the result are the "net assets." Some, like a donation towards building a football stadium, are restricted. On the other hand, unrestricted net assets are, according to the Auditor General's report, "... available to the University for any lawful purpose of the University." If we go to USF's page of past reports, we get the following history (in millions of dollars):


Fiscal YearNet AssetsUnrestricted
2007 - 2008$ 1,040$ 240
2008 - 2009$ 1,165$ 289
2009 - 2010$ 1,267$ 318
2010 - 2011$ 1,300$ 349
2011 - 2012$ 1,273$ 295

Unrestricted net assets could presumably be used as a rainy day fund, just in case this is a rainy day. Of course, the 2012 - 2013 report is not posted yet, but usually we would not expect a melodramatic change over one year.

In comparison with other state universities, USF has the second highest unrestricted net assets in the state (FSU has $ 410 million). Looking at the other large universities, at the end of the 2011 - 2012 fiscal year, FAU had $ 119 million in unrestricted net assets, FIU had $ 183 million, UCF had $ 289 million, and UF had $ 161 million.

Chief Operating Officer John Long warned us about "cash reserves" - a phrase that (curiously enough) does not appear in the financial statements. Perhaps, as the Council of Chairs requested, we could be provided with an explanation of what cash reserves are, how much USF should have in reserve (according to law, and according to the bond rating agencies), how much USF does have in reserve, and so on. Meanwhile, if cash reserves refer to liquidity, we shall see in the next Biweekly that one can find something out about the liquidity of a public institution from the financial statements.

Returning to the AAUP's point, if USF is facing a tight situation where hard curricular decisions have to be made, then the faculty have to be in on the decisions. Curricular decisions should not be made by the Board and their administrative representatives on their own - whatever the rationale.

Chapter Meeting tomorrow Friday, October 11, at 12 noon in EDU 161 on USF Tampa.

There will be free sandwiches, chips, and soda pop. All UFF members are invited to attend. Non-members are also invited to come and check us out. Come and join the movement.

Membership: Everyone in the UFF USF System Bargaining unit is eligible for UFF membership: to join, simply fill out and send in the membership form.

NOTE: The USF-UFF Chapter website is http://www.uff.ourusf.org, and our e-mail address is uff@ourusf.org.

About this broadcast: This Newsletter was broadcast from uff.ourusf.org, hosted at ICDsoft.com, and is intended for all members of the UFF USF Bargaining unit (USF faculty and professionals at most departments). A (usually identical) version will be broadcast to USF-News and USF-Talk from mccolm@usf.edu.

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