What has Purdue done to reduce costs or improve efficiency of its operations? Have there been any cost savings?
Purdue has taken several steps to reduce its budget:
- Annual merit increases—These were suspended for FY10 at all campuses. Adjustments will be made for faculty change in academic rank.
- Special merit pay– One-time special merit bonuses were suspended, resulting in a savings of approximately $3 million in FY09.
- Budget reductions – General fund was cut 2% for FY10, totaling $12.1 million system-wide.
- Faculty and staff vacancies – Vacancies are being filled based on strategic needs only.
- Review of travel – Departments are reviewing all travel requests carefully, especially those for out-of-state and international travel. Travel cost dropped 6% in FY09, saving $2.244 million.
Other recent changes include:
- Debt management – The use of variable-rate debt has saved considerable money by reducing outstanding debt and/or reducing debt service costs. During the 2007-08 fiscal year, Purdue reverted $3.7 million of debt service appropriations to the state and $4.857 million for 2008-09 (nonrecurring).
- Food service consolidation – The university has consolidated food service facilities within the residence halls from 11 to 5 locations. Salary savings were sufficient to finance the costs of these remodeled and new dining facilities. Savings: $2.8 million recurring.
- Utilization of instructional space – On average, our classrooms are used 37 hours a week in the fall semester of 2008 with an average occupancy rate (ratio of seats in the room to seats used) of 70% per room. Classrooms are also used heavily during the evening hours for exams and student group meetings and study sessions.
Some efforts under way
- Competitive bidding
- Large IT purchases – Large purchases of computer equipment are consolidated across campus for bidding purposes, resulting in significant cost savings. Savings: $1.8 million recurring.
- Remarketing of insurance programs – Savings: $1.7 million recurring.
- Server virtualization – Savings: $125,000 recurring.
- Energy-savings projects – $1.7 million in recurring savings under way with another $5 million potential efforts identified:
- FY09 $171,000
- FY10 an additional $995,000
- FY14 an additional $1.7 million
Those under way includes:
- Installing utility meters in buildings. This will help determine which buildings are the best targets for energy reduction technologies. Metering for 58 WL buildings that represent 70% of purchased utilities is expected to be completed in 2012.
- Qualified energy savings projects at three large campus buildings are planned or under way to make building systems more energy efficient, saving energy and money while also reducing overall campus peak demand for steam, chilled water, and electricity.
- Three older buildings are being retrofitted with energy savings upgrades and “tune-ups.”
- LEED green building guidelines for new construction and building rehabilitation are being evaluated. Information and experience gained will result in a comprehensive plan for future energy conservation.
- These energy conservation projects are estimated to generate $2.2 million in annual energy savings in the next five years.
- Instructional computing labs – A current campus-wide review of computer laboratories is determining the right configuration of lab spaces and the right number of labs to best meet the student need.
- Institutional memberships – The university eliminated 84 of more than 900 institutional memberships, reducing the $1.5 million cost by almost $100,000.
- Summer session enrollment – An incentive program has been implemented to encourage colleges and schools to increase summer session enrollment, including distance education. Summer enrollment growth not only generates fee revenue, it advances students to degree, provides instructional opportunities for faculty, and utilizes classroom and residence hall space.
- Established task force on cost savings, efficiency and effectiveness – The task force reviews and identifies cost savings measures and solicits ideas from staff for improving efficiency and effectiveness of business operations.
Some efforts under study
- Libraries print and electronic subscriptions —Savings: $102,000 recurring.
- Discovery Park maturation – $775,000 recurring.
- Organizational restructuring of diversity, computing labs and staffing, video production, corporate relations, marketing and media, academic programs.