Jack's Insights February 2017

By Jack Whittier, Director, Panhandle Extension District and Panhandle Research and Extension Center

I suppose each of us can remember a situation when we were faced with a circumstance where our budget did not match our needs or wants.

Maybe this was as a child in a candy store wanting a few more pieces of “penny candy.” Yes, there was a time at the corner grocery store when you could buy a nice piece of candy for one penny – imagine that!  Perhaps only a few today actually remember this. I do. Or, maybe your memory goes to a time when you realized you would not be able to invest as much in a business venture or farming enterprise as you had hoped or planned.

Jack Whittier

What did you do in these situations?  Maybe it meant waiting until your next allowance, or income from your lawn-mowing job or paper route, before buying that extra piece of candy. Or perhaps it meant adjusting your business strategy in some way. In either case, I expect you may have found a way to accomplish your objective, perhaps by modifying your original objective, or choosing to delay for a time.

It’s no secret that Nebraska is currently facing a decline in budgets due to many factors. This is placing a strain on all enterprises funded with state dollars. This week I watched a broadcast from Lincoln where University of Nebraska President Hank Bounds and Lincoln campus Chancellor Ronnie Green addressed how this budget shortfall affects the University of Nebraska. 

The approach outlined by President Bounds mirrors closely what many of us have done when either considering buying another piece of candy as a child, or adjusting our business or farming strategy when faced with less money than predicted. That is to study out the situation, make sure the information you have is correct, look for alternatives, ask advice from those you trust, consider ways to increase efficiency, develop a plan, consider the ramifications of your plan, then at some point, act on the plan. 

Here are some of my take-aways from the broadcast by President Bounds this week:

  • Knowing there would be a shortfall for fiscal year 2017 (FY17) in the NU budget, the university imposed a hiring freeze last November to generate revenue to meet the university’s $13.3 million portion of the governor’s call-back from NU’s original FY17 allocation by July 2017.
  • The state’s best hope of growing the economy is to continue to invest in education. President Bounds reiterated that NU is the engine that drives the Nebraska economy. He pointed out that for every $1 invested by the state in NU, it returns $6 to the state in economic development – a 6:1 return on investment. That is substantial.
  • Like any company or institution, efficiencies can be found. To that end, President Bounds has appointed a Budget Response Team consisting of nearly 100 subject-matter experts from within and outside the university spanning 10 areas of university operations. The task force is charged with identifying strategies for meaningful cuts – or in some cases revenue growth – while advancing university-wide goals to maintain important service to students, faculty, staff and other stakeholders.
  • There is currently a clarifying process going on as the legislature works through the process of allocations and budget formation. We are grateful to have Senator Stinner as the appropriations committee chair. He understands Western Nebraska, and his banking expertise make him an excellent fit for this job.

The university hiring freeze noted above included a provision for “mission critical” exemptions. When notified of the hiring freeze, we immediately requested an exemption to proceed with filling our open position for an irrigation and water management specialist here at the Panhandle R&E Center. We received word last week that our exemption was approved by President Bounds and Chancellor Green. Thus, we are moving forward to fill this important position, and by the time you read this column, we will have interviewed a final candidate with the goal of having an irrigation specialist in place for the upcoming growing season. Granting this exemption is strong evidence that water and irrigation is mission critical to the university and to the Panhandle.

I have been asked how the NU budget will impact the Panhandle Center and the 16-county Panhandle Extension District in western and north-central Nebraska. My answer currently is that we really don’t know at this point, but we do not expect major cuts in personnel. We can likely find efficiencies in operations and we are studying this now. Like the child in the candy store, we must be wise in our decisions and we will likely postpone or modify some of our objectives.

In the meantime, we are watching, preparing and planning as the process proceeds. Above all, we are committed to continuing to meet our mission to provide science-based information to our clientele. We will continue to be good stewards of the trust, and finances, provided by the taxpayers of the state. I promise you this!

The entire broadcast by President Bounds, along with much more information concerning the response to the budget situation at the University of Nebraska is available at https://nebraska.edu/president/budget-info-2017-19.html#resp-team. Please take a look.