WKU to use reserve funds to help cover its shortfall

Jacob Dick

WKU administration has announced  the university will have to use reserve funds after the executive order from Gov. Matt Bevin for 4.5 percent cuts to every state funded college and university forced the revision of this fiscal year’s budget.

When asked for comment about the revised budget or proposed litigation from the university, President Gary Ransdell, vice president for Public Affairs Robbin Taylor and senior vice president for Finance and Administration Ann Mead could not be reached at time of production.

President Ransdell did release another statement on Monday around 4 p.m.


“Soon after budget talks ended on Thursday, Governor Bevin issued an order to reduce the state’s quarterly allotments to universities by 4.5 percent,” Ransdell said. “Given the lateness in the fiscal year and the extraordinary circumstances that would be required of the campus to reduce campus operating budgets that have already been obligated, we have decided that the best course of action is to seek approval at the April Board of Regents’ meeting to draw down the University Reserve Fund to carry us through the end of the fiscal year. We will then replenish the Reserve Fund with appropriate non-recurring budget actions.”

The letter enacting these cuts, delivered on March 31 from the governor’s office, advised Secretary William M. Landrum and State Budget Director John Chilton that allotments for all state higher education institutions be reduced before the end of the business day.

In a press conference Friday afternoon in Frankfort, Attorney General Andy Beshear questioned Bevin’s authority to enact his order.

“A governor, any governor, does not have this power or authority,” Beshear said. “The Governor’s actions violate explicit actions that govern budget reductions.”

Beshear said he would wait seven days for a recension from the Governor’s office before seeking litigation.

Speaker of the House Greg Stumbo has made comment about the legality of Bevin’s action.

“If his revenues are sufficient, and there’s no shortfall, then the appropriation that the General Assembly made to those entities, I believe, has to be followed,” Stumbo told reporters Friday.

Bevin believes otherwise when it comes to his executive power.

“He knows that I have legal authority to do this,” Bevin said. “We know as well, and we are exercising the authority that we have.”

Ransdell released a statement on Friday afternoon about the ordered cuts and the possibility of using reserve funds to manage a $3.5 million.

The Lexington Herald-Leader reported on Friday afternoon, officials of the University of Kentucky hadn’t been directly notified of the cuts yet. Spokesperson Jay Blanton said the university had started planning for the revision.

“Gov. Bevin announced this measure in January, so we anticipated it,” Blanton said. “We will be working over the next few months to implement this reduction with the context of our current-year budget. It is too early to speculate on the specific measures we will take.”

Morehead State University already announced furloughs for employees in preparation for the budget cuts that have been proposed in Bevin’s address to the commonwealth in January.

Bevin still has until Thursday, April 7, before Beshear promised to seek litigation over the orders. The House and Senate are tentatively expected to come to an agreement over the budget by April 12.

Ed. note: The online version of this article has been amended to more accurately reflect the distinction between the budget revisions approved by the Board of Regents for the 2015-16 budget and the cuts to higher education allotments ordered by Kentucky Gov. Matt Bevin. The Herald apologies for any confusion related to this story.