By the numbers
Here’s a look at savings and revenue changes related to the tuition freeze over the next two years:
• $40.5 million: Total shortfall created by two-year tuition freeze at Purdue’s West Lafayette campus
• $12.2 million: Decreases in unit budget requests, mostly for new equipment or other items that are deemed nonessential.
• $6.9 million: Savings from implementing a 1 percent campuswide merit wage pool.
• $5 million: Additional revenue created by shifting cash from low-interest bearing accounts into Purdue’s endowment, which generates returns of about 5 percent, and putting extra money into an overnight cash fund, which generates returns of about 2 percent.
• $4 million: Savings from switching Purdue’s health care administrator from Cigna to Anthem.
• $2.5 million: Savings from changes to the university’s medical plan in 2012 will generate a recurring savings of $2.5 million.
• $1.01 million: Lower than expected interest rates on construction loans.
• $542,952: Miscellaneous budget adjustments.
• $9.9 million: Shortfall yet to be made up. from budget requests, mostly for less new equipment $4 million — by switching from Cigna to Anthem.
When a two-year tuition freeze was announced March 1 by Purdue University President Mitch Daniels, he said the move would cost $40 million — meaning the university would have to find new revenue, savings, or a combination of the two equal to that amount.
This week a top Purdue official said the university is three quarters of the way to reaching the $40 million goal.
That includes $5 million in new revenue, $7 million in savings by instituting a 1 percent merit raise wage pool, and millions more in other cost-cutting moves. Not all pieces, however, are in place, said Al Diaz, vice president for management and budget and treasurer.
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