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Funding for University System of Maryland Office threatened, officials say

Administrators from the University System of Maryland delivered impassioned and at times confusing testimony before the House Appropriations Subcommittee on Education and Economic Development on Wednesday in response to recommended budget cuts.

Chancellor William Kirwan, who, with the Board of Regents, oversees the state’s 12 public universities, slammed a proposed $4 million cut to the University System of Maryland Office as recommended by the Department of Legislative Services. The system office plays an integral role in implementing broad strategic planning for the state’s various campuses.

Although the proposed cut is substantial in relation to the office’s $9 million operating budget, the recommendation allows the system office to make up those slashed funds by essentially charging universities for the services it provides. This reallocation of funds allows the office to continue functioning in its full capacity while still saving the state money. Identical steps were taken last year when the office’s budget was cut by $4 million.

However, according to Kirwan and Joseph Vivona, the vice chancellor for administration and finance, an oversight in analysis means that the proposed $4 million cut would actually equal $8 million the office would be charging universities.

Kirwan says that when the system office was forced to regain $4 million from the state’s academic institutions last year, those schools permanently reduced their budgets by $4 million in order to pay for the services provided. As such, if the system office was forced to make up an additional round of cuts, the state’s institutions of higher education would be forced to pay $8 million — all but $1 million shy of the system office’s entire operating budget.

“Next year they’re going to have to give us basically $8 million because their budget was reduced by $4 million for this purpose,” Kirwan said. “There isn’t an auditor on the face of the earth who would come in and say that 8 of the 9 million dollars that you fund is for services to the campus.”

“The base cut that was taken a year ago is still in place,” Vivona added. “We are simply causing the institutions to have to pay again.”

Delegates seemed confused as to why schools would permanently reduce their budgets.

“I’m curious now as to why they would do that if the action last year was a one-year action,” questioned Del. Melony Griffith, D-Prince George’s.

Vivona said that after campuses paid for those services from the system office, their overall budgets do not increase the next year to compensate for that $4 million. Thus, cutting the general fund again would be an addition to last year’s base cut.

“If you were to make that cut in the system office budget for 2013, that money should really go back to the institutions,” said Vivona.

Calls for comment from the Department of Legislative Services were not immediately returned Wednesday night.

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