As if state budget woes weren’t enough, Kansas University was hit with another set of cuts this year — from the Kansas University Endowment Association.

Endowment Association officials announced in February that a combination of policy changes and stock market declines would result in an $11.5 million decrease in spending from endowed accounts next year.

That comes during a year when the university has had to trim $18.8 — or about 8 percent — in state funds from its budget, and additional state funding for next year may be unlikely.

“It’s going to make us live a less comfortable life,” said David Shulenburger, provost and executive vice chancellor. “The cuts will have an impact on the classroom if they go any deeper than they are.”

The cuts have led to some publicly noticeable changes at KU, including the closing of the public portion of the Museum of Anthropology and the elimination of a section at the Kansas Geological Survey, a nursing program at KU Med and a physical therapy program in Pittsburg.

Other cuts weren’t as noticeable. For example, KU has canceled its Wheat State Whirlwind tour for new faculty and staff and has limited the amount departments can spend on travel to conferences and for research.

In all, KU has laid off 44 workers and cut 115 vacant positions to deal with the budget cuts.

Along the way, KU officials have said their top priority in cutting the budget was to protect the classroom. Also, research endeavors were supposed to be kept as immune as possible from the cuts.

Gov. Kathleen Sebelius’ proposed budget for next year would keep higher education spending at the same level as it was this year after the cuts. But because KU is expected to have $16 million in additional operating costs next year — for everything from heating bills to health insurance — that amount of money would, in effect, be a cut.

Endowment hit

That was all bad enough news, until the Endowment Association made its announcement in February.

The value of the endowment has fallen 20 percent since June 2000, to about $683 million.

Stock market declines would lead to a $3.7 million decrease in payouts on scholarships, professorships and departmental support. A change in policy for how much could be spent out of each account would lead to an additional $4.1 million. That change was meant to preserve principal for future years.

And then there were about 700 Endowment Association accounts that had fallen below their original value, which made them subject to additional payment restrictions under the Uniform Management of Institutional Funds Act. Those funds can pay only 30 percent to 35 percent of a normal payment from an endowment fund, meaning an additional $3.7 million reduction.

That change concerned James Gentry, dean of the school of journalism. He said he had two professor funds and about 20 scholarship funds that will be affected. One professorship fund, which started at $824,409 has dropped to $810,779.

“I don’t like being told out of the blue I’m going to have less money to pay my faculty,” he said. “I was expecting almost $45,000, and now I’m getting $15,000.”

Scholarships will take one of the biggest hits under the endowment changes. Toni-Marie Montgomery, dean of the school of fine arts, said the $800,000 her students received in scholarships this year would be reduced by $160,000.

“We are in competition with other institutions for recruiting students, so our big concern is the priority we’re going to have to make on students we’ve already made commitments to,” said Montgomery, who in July begins her duties as dean of the school of music at Northwestern University in Evanston, Ill. “We’ll have less money to recruit new students.”

Kim Wilcox, dean of the College of Liberal Arts and Sciences, said the endowment hit would affect many KU funds — from travel to student organizations to library acquisitions.

“It’s all those seemingly small things that make such a big difference in the life of the institution and the students that are here,” he said.

Campaign update

The cuts come at a time when funds handled by the Endowment Association actually are increasing.

The association spent a record $68.9 million last year on KU during the fiscal year ending June 30, 2002.

Much of that money was one-time funds raised during the “KU First: Investing in Excellence” campaign, which aims to raise $500 million for KU by the end of 2004. It has raised $404 million so far.

Spending from the Endowment Association this year is ahead of last year’s rate. Through January, the association spent $52 million on KU for the fiscal year ending June 30.

Among other things, that extra money is helping to finance many construction projects at KU, including a new home for Kansas Public Radio, a new building at the Edwards Campus in Overland Park and the Anderson Strength and Conditioning Center.

‘Make every dollar count’

Shulenburger said state funds will have to cover shortfalls in endowment money, especially for professor salaries that will receive less financial support.

“When we get to the point of reallocating state dollars, then we will be the same process we’ve been in with the state budget cuts,” he said. “We’ve tried really hard to have a minimal effect on the classroom and on research.”

Shulenburger, an economist by education, said he was optimistic the state economy eventually would recover, leading to better fiscal times for KU. Meanwhile, the focus will be making more with less.

“We can’t wait for that,” he said. “The cuts we had last year take the university to a position of long-range planning, to reallocate money and make every dollar count.”