The mood was tense inside Old Main Monday afternoon. The University of Arizona’s monthly faculty senate meeting was about to start, and the room was so packed that some faculty members had to stand in the back while over a hundred additional participants sat quietly in a Zoom waiting room.
The strained atmosphere was understandable — it was the first time the faculty senate was gathering since university President Robert Robbins and senior vice president and chief financial officer Lisa Rulney told the Arizona Board of Regents last week that the UA was in a “financial crisis.”
“This is going to require some draconian cuts,” Robbins told the faculty, who remained skeptical about how the university got itself into this position.
“How can it be that you were not in the know for such a long time?” asked engineering professor Wolfgang Fink. “Your subordinate officers have an obligation to inform you, not on a monthly or quarterly basis, they have an obligation to inform you literally on a daily if not hourly basis if things like this transpire.”
Robbins, who was slotted to speak for 20 minutes but ended up doubling his time in front of the faculty, struggled to answer the question. The university had initially projected having 156 days of cash on hand for this fiscal year. As it turned out, their model was off by $240 million. Instead, the UA has just 97 days of cash on hand, the new model estimates.
“I did know we were spending money, but I thought we had reserves to spend money on,” Robbins said. “But this is a big miscalculation.”
The miscalculation claim was heavily questioned by faculty members like astronomy professor Lucy Ziurys.
“Are we going to just let them continue making mistakes and, you know, accept it?” Ziurys questioned Robbins. “Because that is a mistake. If I make a $240 mistake on my grants I get nailed by the university. You have all kinds of people in administrative positions, supposedly there to balance the budget and to keep an eye on these things. That is a very bad mistake.”
She was not alone in her confusion. Katharine Zieders, a professor of human development and family science, asked how Rulney, who supervises the team in charge of the cash prediction model, “still has a job at this point.”
Robbins said that he would be “looking at accountability,” but defended Rulney and refused to say whether she would face direct consequences.
In the Nov. 2 meeting with the Arizona Board of Regents, Robbins and Rulney confirmed that the university was instituting a 2% budget cut, with more changes to come. Administrators are considering hiring freezes, concessioning on campus amenities such as parking, cutting sports programs and leasing out land, he said.
Hiring freezes should only impact colleges within the university that are “running a structural deficit,” Robbins said. He said in a brief interview after the meeting that he believed there were only two or three colleges directly impacted by this, though so far the university has not made public which ones.
Financial aid, which he spoke about at length to the Arizona Board of Regents, is something Robbins is committed to re-evaluating.
The UA offers a four-year tuition guarantee, meaning students are promised the same tuition throughout their four years at the institution. In addition, the university spends over $300 million on financial aid and merit scholarships to attract high achieving students, as well.
Despite that investment, the amount of financial aid given out is “not financially sustainable,” Robbins said.
“One of the solutions that I think we need to focus on is to make the tough decision to decrease the amount of financial aid that we’re giving to students,” he said, even though the changes mean “there are some students who won’t decide to come here.”
Robbins told faculty members that the university is losing money on students who in high school had a GPA between a 3.75 and 4.0 because of the amount of merit money and financial aid they are awarded.
“If you look at the band from 3.75 GPA to 4.0, there are a lot of students here that pay nothing,” he said. “We lose money on every one.”
Athletics has also been a drain on the financial resources of the university, Robbins told the faculty, most of whom spoke out against the $55 million loan made by the university to the athletic department during the height of the COVID-19 pandemic. That money, Robbins said, has not been paid back “fast enough.”
“I don’t have a lot of faith,” said research professor Ted Downing, of the university’s decision to make that loan. “I’m worried about priorities here. Does that loan reflect, to my point of view, a priority of athletics over the faculty, staff, students and the programs? That prioritization strikes deep, deep into my concern.”
The athletic department’s budget is roughly $100 million. About $40 million of that comes from the Pac-12, about $30 million comes from ticket sales, “primarily in football and basketball,” Robbins said, and the last $30 million comes from philanthropy and contracts.
Currently, the UA has 23 sports teams. Robbins said other teams in the Big 12, which the UA is joining, have an average of 17 and indicated that cutting sports teams is a strong possibility.
“Everything is on the table in terms of dealing with athletics,” he said. “This is an issue that is going to require a lot of tough decisions.”
Faculty members asked that Dave Heeke, the UA’s vice president and director of athletics be present at a future meeting. Robbins agreed.
Johann Rafelski, a physics professor, urged Robbins to consider selling the athletics department to an outside vendor.
“People who are qualified to run an athletics department may turn it into a profit,” he said. “We could perhaps get a good sale price.”
Robbins responded that it was a good point, and something that he has considered, though he seemed more enthusiastic about the possibility of leasing land like Arizona State University does. The UA’s Experiment Station land has over a thousand acres, and Robbins suggested the possibility of leasing out some of it.
“I think we could invest in doing new ground leases and have a steady amount of income, forever, on that land,” he said.
Robbins and the faculty senate both agreed that future meetings needed to take place. The president’s office has not released any official plans to deal with the financial issues of the university, but are expected to do so by Dec. 15, when administrators must submit their plan for financial prosperity to the Arizona Board of Regents.
“Clearly this is a major problem,” Robbins said to the room. “I obviously take it very seriously.”
