Though the University of Arizona has made progress in reducing a budget shortfall once projected at $177 million, it may take more than a decade for the university to reach the cash reserve minimum required by the Arizona Board of Regents, The Arizona Daily Star reported.
The budget deficit, discovered a year ago, was brought on by flawed revenue projections, overspending on strategic initiatives and other missteps. A little more than a year into the crisis, Arizona has reduced the shortfall to less than $65 million through a series of cost-cutting measures that have included personnel cuts and a freeze on travel and building projects.
Last week, the university’s chief financial officer, John Arnold, told the board that it may take more than a decade to hit ABOR’s minimum requirement of 134 days of cash on hand. Officials project the University of Arizona will end the current fiscal year with 76 days of cash on hand.
While Arizona could likely improve its cash on hand by enacting deeper cuts, new president Suresh Garimella told the board, “We don’t want to put perverse things in place.” He said the university should approach the issue with a “longer-term strategy” as it seeks to continue its financial progress.
