When Interim Montana State University Billings Chancellor Ron Larsen gave his convocation speech to faculty and staff on Tuesday, he didn’t know another budget cut was looming.

“Twenty-one hours later, they send out an announcement saying we may be looking at another 10-percent cut,” Larsen said on Friday.

He's referring to an announcement from the state budget director that hundreds of millions of dollars in additional cuts could be coming to government agencies. A maximum 10-percent budget reduction is possible.

That would come as the Montana University System is already dealing with fewer state dollars, which triggered tuition increases at most campuses in the state.

A reduction of 10 percent for MSUB would be roughly $4 million, though it might not be that figure with all other universities taken into account. But that number is reminiscent of a painful $4.4 million budget cut the university undertook over the past two years.

Larsen said the figure represents a worst-case scenario, which isn't finalized.

"It makes the statement that this is serious, pay attention," he said. "And it's my hope that there will be some negotiating that goes on from here to find what is necessary to make the books balance.”

But the university is preparing. Larsen said that some vacant positions won't be filled, though he said no one will be laid off.

The coming academic year looked to be on a course of stabilization. Early indicators showed increased freshman retention and, Larsen said, flat enrollment relative to the previous year.

In August, MSUB submitted a budget to the Office of the Commissioner of Higher Education that's about $1.6 million less than last year's expenditures. MSUB's budget director noted that last year's budget was inflated a bit by a one-time, $1 million carryover for retention and research grants.

Aside from that, a roughly $600,000 reduction is in step with previous estimates.

Larsen, who started in January, will begin his first full academic year as interim chancellor. Montana State University spokesman Tracy Ellig said in an email statement that Larsen's interim tag remains, though there is no imminent plan to find a replacement.

"Ron is making progress on stabilizing and strengthening the campus," Ellig said in the statement.

The Board of Regents will discuss and finalize submitted operating budgets during its September meeting in Butte. But the decision on these additional cuts will likely come after that.

Larsen said that the use of reserves will factor heavily into MSUB's ability to weather those reductions.

“If we do have to take these pretty significant hits this biennium, then we’ll use a lot of reserves to get through this year. And we’ll use this year to prepare for next year,” Larsen said. "This may be the rainy day.”


General Assignment Reporter

Reporter for The Billings Gazette.