As Jefferson Public Radio reported, the Southern Oregon University Board of Trustees voted unanimously last Friday to create its own plan for long-term financial stability rather than adopt entirely the steep cuts and revenue-raising measures the consulting firm Deloitte has recommended. SOU is facing a deficit of more than $12 million which is expected to grow to nearly $17 million by 2030.
SOU has until next month to adopt a financial stability plan in order to receive $15 million in emergency funding approved by Oregon lawmakers in March. Deloitte’s plan calls for cutting four academic programs, including music and creative writing, and reconfiguring or consolidating nine other programs in subjects like Native American studies and philosophy.
This is the latest financial emergency the university has faced in recent years that it’s attempted to address through workforce and academic cuts. Last September, for example, the SOU Board of Trustees approved a plan to slash more than $10 million over four years by eliminating more than 20 academic majors and minors. SOU President Rick Bailey joins us for a perspective, along with Sage TeBeest, a creative arts program assistant at SOU and the president of SEIU 503 Sublocal 84, which represents classified staff at the university.
Note: The following transcript was transcribed digitally and validated for accuracy, readability and formatting by an OPB volunteer.
Dave Miller: This is Think Out Loud on OPB. I’m Dave Miller. The clock is ticking on a plan to save Southern Oregon University. That seems like a dramatic way to put it, but the consulting company Deloitte didn’t pull punches in its recent analysis. It put forward a plan to cut about $20 million from the university’s budget to address its structural deficit. The board of trustees of SOU say that they’re not going to simply enact the consultant’s plan. Instead, they have until June 18 to come up with their own way forward.
We’re gonna get two perspectives on this today. In a few minutes, we’ll hear from one of the union leaders at SOU. We start with the university president Rick Bailey. President Bailey, welcome back to the show.
Rick Bailey: Thanks so much, Dave. Happy to be with you.
Miller: How would you describe the university’s financial position right now?
Bailey: Well, I don’t want to pull any punches either. I think our challenges are existential, and I use that word intentionally. But I know that we’re also highly recognizing that this is an institution that’s worth fighting for. It’s incredibly important to the economy, to the workforce, to everything, culturally, to the region. So we are all committed to finding a path forward.
Miller: I want to just zero in on that “existential” word. So just to be clear, if the board of trustees [said], “Eh, let’s not worry about this right now,” what happens?
Bailey: Let me be very clear that I’m very glad that they did not do that. But we are in a difficult position. Like a lot of institutions in the state and around the country, we are facing very, very serious budget challenges. There are colleges and universities around the country closing or merging on the average of one per week now. That cannot be SOU.
Had they decided to do nothing, I think it is pretty clear that we would have ended up having a much more difficult conversation about how to spin it down.
Miller: As I said in my intro, the board said at a meeting on Friday that it’s not going to base its final plan on the report put together by Deloitte. It’ll use that report instead as a resource. But what does that mean? They have an incredibly short time to make profound cuts and changes to departments, to management structure, to the provision of food services, everything that is involved in university. The kind of things that could take years to make minor changes to, they have to do in weeks. It doesn’t seem like they can start from scratch.
So just how much of the Deloitte report are you expecting they’re actually going to use?
Bailey: And it’s really not they, it’s we. It’s all of us doing it, so I appreciate the way you asked the question, Dave. We messaged to our campus community that we couldn’t start from scratch, we don’t have the bandwidth or the time to just start from scratch and come up in six weeks with a completely different design. We are using the recommendations from Deloitte as a starting point, and as a framework, and as a resource, as you mentioned and as the board acknowledged.
But I think we heard loud and clear from students, faculty, staff, community members, alumni and our own board members that there are probably ways in which we can still solve this very, very complex puzzle but to do it in ways that are more sensitive to who we are as an institution, to our values, to our identity. I don’t suspect that what you and all of the OPB listeners are going to see and hear about on June 18 is going to be wholesale, radically different. But I do think that you will see something that is more in line with who we are as an institution, and more importantly, with who we want to be as an institution.
Miller: Do you have any specifics that you already know of, places where you know you’ll diverge from Deloitte’s plan in specific ways?
Bailey: I’m gonna say no. Ultimately, it’s my recommendation to the board of trustees, and I have to own it and accept responsibility for it. But I don’t want to put my finger on the scale now. I think it’s important, particularly in these next few weeks, to really give as much agency as we can to students, faculty, staff and community.
Miller: Well, along those lines, at that recent meeting on Friday, the board created a new advisory committee that will include students, staff and faculty leaders. How are you all gonna ensure that that committee’s feedback is actually incorporated into the final plan, that it’s not just a kind of boilerplate “you were here, you said some stuff and now let’s do our thing,” that this group has a meaningful say in the process?
Bailey: Yeah, it’s a great question, Dave. And I’m not saying this because my colleague Sage is in the next segment. But I will say this: one thing I’m really, really proud of here at SOU, we have a group that we affectionately call the five families, it’s three sharing governance groups and two very strong unions.
Miller: None of them mafia groups?
Bailey: [Laughing] Yes, the misnomer is I take full responsibility for, I apologize for that. There is no violence associated with these groups.
But it really is a way that we have organized ourselves informally so that we have dialogues. The faculty senate, staff assembly, our student government, our classified union and our faculty union, we are all one. No one is afraid of speaking truth to power, and everyone is so invested in the future of this university that it means we have really honest, candid, thoughtful and respectful dialogue with each other. And that leads to better strategic decisions. It’s easy for me to say this, Dave, but I don’t think anything that we do over the next several weeks is gonna be performative. It’s intentionally about, how do we get to a better decision?
Let me also say this, Dave, and I definitely want your listeners to hear this: what I end up presenting to the board in mid-June, no one is gonna be happy with. Nobody. Because the environment in which we are operating is really challenging and the headwinds are real. We are going to have to be a different version of what we’ve been for the last 154 years.
Miller: Trustee Hala Schepmann, chair of the chemistry department and a member of the board of trustees, said this at that meeting: “In order for us to succeed, we must build a future on a solid foundation and understand that cuts have to be made. But we also have to ask ourselves, what is the bottom line? So when we’re considering eliminating programs like math or music, and think that by offering a minor in those areas that’ll be sufficient to maintain the quality and expertise currently delivered, that’s not only uninformed, it’s delusional thinking, in my opinion. We have to draw the line: no more cuts to programs.”
Can the university achieve the level of cuts that are necessary to survive, without cuts to academic programs?
Bailey: Yeah, it’s a good question, Dave. I’m gonna say it is likely ... With the size of the challenge that we face, I think it’s delusional for us to say that we’re gonna be able to do everything that we’ve done before. We’re not funded to do everything that we’ve done before and we can’t put more of that financial burden on the backs of students. So there is a reality.
Now, there’s also a bill that was passed in this last legislative session, 4124, that really looks more writ large at the universities and colleges in the state to determine whether or not there are opportunities for us to partner, even academically, in ways that we haven’t. I just think we’re going to have to be creative in how we think about the future delivery of service.
Miller: And that gets to some of the questions that Deloitte brought up, or the different pathways for thinking about the management of the university, whether it’s outsourcing a lot of things, or partnering with an existing organization or university, or partnering with local entities. And they have different timelines for the different versions of new relationships. But in my mind, these are the kinds of things that could take years to develop. Are you going to be putting forward a radically new version of governance six weeks from now?
Bailey: No. And I don’t think anyone in the state expects that we’re going to do that. But I do think that we had better show that we’ve done our homework. It’s why we are talking to colleagues, we are meeting with potential partners. And by the way – and this is not gonna be a shocker to your listeners – it is not like we have a bunch of institutions around the state that are begging to come in and partner, because they’re dealing with their own challenges as well. So I think it’s going to require – this is the second part of the answer – more than just me making a decision, it’s even gonna require more than our board making a decision. This is where the Higher Education Coordinating Commission, probably the Office of the Governor, there are going to have to be other actors in this work to be able to facilitate and actually craft some of those.
The other part in your question that’s really important is that some of these recommendations or pathways that the Deloitte recommendations articulate are on very, very different timelines. One of them, for providing back office functions, involves a consortium with the other technical and regional universities. That’s great, and ideally there is an interesting solution there. But that’s probably 12 to 18 months at best to create something like that.
Miller: [It] wasn’t spelled out with too many details what that would look like, but when I read that or saw that on the graph, I imagined that you, Oregon Tech, Eastern and Western would pool together your HR, legal or tech backend stuff and find some savings with reductions in workforce. Is that the basic idea that’s possible?
Bailey: That’s what they put forth as an idea. And by the way, it’s not uncommon for us, because we’ve already had these conversations … Are there things that we can share, specifically if they’re things that are contractual, where we don’t have employees? And because all four of the schools you just mentioned, we all have collective bargaining agreements that are very specific in some ways, certainly in faculty. So we just have to be sensitive about how we move forward with those things.
But I do think that the future demands that we really get out of our comfort zone and start looking at how we do things differently.
Miller: Finally, it’s important for listeners to remember, they may have heard your and my conversation the last time you were talking about big cuts. And I bring that up because these cuts that you’re in the process of determining now, they’re not in a vacuum. They’re on top of two rounds of significant cuts in recent years. At what point does cutting to achieve solvency doom you because you’re a shell of what you once were, and prospective students say, “there’s not enough there for me to even want to go?”
Bailey: So let me argue with the premise of your question a little. I think, and I’ve said publicly, if all we do is become a smaller version of who we once were, who we were but just offering less, then I think we are in trouble. What we have to do, as part of this, is really reinvent, what does the future of public regional higher education look like? And let’s get in front of that wave rather than behind it.
You’re right in that if all we’re doing is cutting … and the last time I was here, every layer that we peel back just shows how deep this structural imbalance has been, and that has grown for a long time. And the fact that we’ve rolled up our sleeves over the last four-and-a-half years and have battled this together, it’s not lost on me the wounds that that has inflicted on our institution.
The other part of your question is, we have to make sure that at the end of this transformation that we are a viable, reimagined public regional university that actually is better able to weather the headwinds that are still coming.
Miller: Rick Bailey, thanks very much.
Bailey: Thanks, Dave.
Miller: Rick Bailey is the president of Southern Oregon University.
For another perspective on the university’s path forward, I’m joined by Sage TeBeest. She is a creative arts program assistant at SOU and the president of the classified staff union at the university. Sage, it’s good to have you back on the show.
Sage TeBeest: Good afternoon. Thanks for having me, Dave.
Miller: How are you feeling these days?
TeBeest: I think we’re a little battle-worn at this point.
Miller: I’m curious what went through your mind when you read the Deloitte report? And again, it’s worth saying that the board of trustees has made clear they’re not simply going to rubber stamp that and put that forward as their plan, but it’s clear from President Bailey and from what they said that they will absolutely use it as a kind of resource or a basis for their decision making. So, what do you see in the report?
TeBeest: Well, correct, I think it’s a good thing to clarify it as not being a plan. I look at it as an evaluation of our institution, and a recommendation for potential cuts or savings in order to restructure and potentially course correct from where we are right now.
With that, there are some things in there that are hard to swallow, one of them being specifically the large amounts of outsourcing recommended. I don’t think that we will find the savings necessary to correct our path by simply outsourcing. With that, we also have certain obligations according to our CBA.
Miller: The collective bargaining agreement or agreements with different unions.
TeBeest: Correct, that will have to be followed, when we do the process of outsourcing. There’s a long process of feasibility studies, benchmarks that have to be met in order for that to go forward. We still have the layoff process that will have to be followed as we do go into a season of cuts. We’re aware that that is coming, we’re not naive to that. This will be our fourth consecutive year of layoffs, so it’s not new territory. It’s something that sadly [is] becoming commonplace in what we experience every year.
Miller: Do you agree with the starting point for President Bailey, and the trustees at this point, and in the report from Deloitte that if the university doesn’t make enormous cuts and changes, that your university’s future is in real jeopardy? Do you agree with the basic premise that the university is facing an existential threat right now?
TeBeest: Yes, I do. And I’ll expound on that, because there are so many different facets to this situation. Some being out of our control, some we very well need to be a little more introspective and decide what we could have done better. And I’m aware that, yes. If we do not radically change, we’re gonna basically not exist. That’s where they set us up for at the end of the legislative cycle was that we have to meet these particular benchmarks or it’s a wind-down status. None of us want that. Everyone is fighting to save the institution, their programs, the things they care about, their jobs.
But we do understand that we have to make changes and those are not going to be things we take lightly. There are gonna be individuals whose livelihoods are impacted, students who potentially have programs of study that will be eliminated. It is going to be hurtful in a lot of ways, and heartbreaking, especially when we see our students having to potentially leave for other program paths. I hate to see our institution shrink in the way that it has to.
We’ve had multiple outside things that have changed, whether it is the demographic cliff, whether it is state funding levels that currently put us at 46th in the nation in funding. We received $6,200 per full-time equivalent student. On the other hand, our community colleges receive $12,200 per full-time equivalent student. It’s the fourth largest disparity in the country, frankly, so that makes it pretty hard to keep everything going and running when you’re not at a level of actual operation funding that you need.
The other is all of the changes at the federal level that are impacting Pell grants, financial aid, lifetime financial aid limits, TRIO, McNair. There are all of these things we’re being peppered with at the same time that we’re having to figure out how we’re going to tackle, and to do it in the best way that we can in the most thoughtful and caring way for our students, our staff, our faculty and the greater community. It’s gonna be a lot to take on.
Miller: President Bailey was adamant that you, meaning faculty, labor leaders or students, that the entire community will have a real voice in these conversations in the coming weeks. Do you think he’s right?
TeBeest: I do. I know we are currently working to put that group together so that we can all sit down, roll up our sleeves and try to figure out the best path forward. The one that is the least harmful, but necessary in order to course correct.
Miller: Sage TeBeest, thanks very much.
TeBeest: I appreciate it, thank you.
Miller: Sage TeBeest is creative arts program assistant at Southern Oregon University, where she is the president of the union that represents classified staff.
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