To: All Faculty & All Academic Professionals & All Civil Service Staff
           <everybody@illinois.edu> 
    From: "President B. Joseph White" <presidentwhite@uillinois.edu>

Reply-To: presidentwhite@uillinois.edu
 Subject: MASSMAIL - Legislative FY 06 Budget Update

June 7, 2005


Dear Colleagues:

	The Illinois General Assembly met its May 31 deadline to pass an 
appropriations bill for fiscal year 2006 (FY06), which starts on July 1. 
Here are the outcomes for the University of Illinois:

*	State universities were spared funding reductions experienced two 
and three years ago and appropriations from general revenue funds are 
about the same as in the current FY05;
*	The U. of I. will receive a total of about $700 million in state 
appropriations for FY06: $697.8 in general tax revenue, $2 million from 
the Fire Prevention Fund and $250,000 from the University License Plate 
Trust Fund;
*	Total state support for the University in FY06 will exceed $1 
billion, comprised of the amounts noted above plus $325 million in 
payments made on behalf of University employees' retirement and health 
care benefits;
*	No capital budget was approved for the second year in a row, 
increasing our unmet capital needs and adding to our deferred maintenance 
situation;
*	Funding was provided for important functions within two of our 
missions: $1 million for the educational retention CHANCE program at UIC 
and $750,000 for Illinois VENTURES as part of our economic development 
initiative.

In light of the state's serious budget situation, I appreciate the level 
appropriation for the University in FY06. I am, of course, disappointed 
that we did not receive the 1% ($7 million) increase in our budget 
recommended by the Illinois Board of Higher Education.

In appropriations hearings and personal meetings with legislators, I 
found that most lawmakers recognize the tremendous value of public higher 
education. But legislators and the Governor faced a very difficult task 
in producing a balanced budget due to a structural imbalance between 
necessary expenditures and available revenue.

While the revenue outlook has improved moderately for FY06, the growth 
rates of program expenditures--particularly those associated with health 
care and retirement systems--continue to far outpace projected revenues. 
With no widespread support for tax increases, large spending cuts loomed 
in the budget process. 

Instead, the General Assembly ultimately decided to modify pension 
benefits for public employees and to reduce pension system contributions 
for the next two years. (Additional details on this matter can be found 
on the State Universities Retirement System--SURS--website:www.surs.com/) 
All indications are that the Governor will sign the budget legislation 
without making significant changes.

I am committed to maintaining the excellence of the University of 
Illinois and will work with the Board of Trustees to ensure we have the 
resources we need in the years ahead.

I deeply appreciate your hard work and dedication to the University of 
Illinois. I wish you a pleasant and productive summer.  


Best regards,

Joe 

B. Joseph White
President
This mailing approved by:
The Office of the President

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