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President Killeen announces $24 million in cost-saving initiatives
Latest moves add to $15 million in earlier savings and reallocations

October 19, 2015

URBANA —University of Illinois President Timothy L. Killeen announced nearly $24 million in spending cuts Monday for central administration programs not directly related to teaching and research as the university prepares for expected reductions in funding once a new state budget is approved. 

Killeen said the spending cuts for data processing and building maintenance were recommended by a high-level committee that is reviewing centrally controlled accounts to identify cost savings that will protect the University’s core academic and research missions.

The initiatives add to $8.2 million in recurring funds that Killeen redirected from the University’s central administration in June to support student programs and services on the three campuses, and a hiring freeze implemented in central administration last summer that could save nearly $7 million.

“To help Illinois overcome its current financial challenges, every agency that relies on state support must do its part,” Killeen said. “These cuts will reduce University spending while protecting programs that provide for world-class and affordable educational opportunities, workforce development and cutting-edge innovation that are all crucial to the state’s future prosperity.”

The latest cost-saving initiatives were recommended by a committee appointed by Killeen last spring to explore efficiencies in the University’s $5.6 billion budget. The committee, which includes university vice presidents and campus chancellors, was formed after Governor Bruce Rauner proposed a funding reduction for public universities in Illinois that would cut the U of I’s fiscal 2016 appropriation by 31.5 percent, or about $209 million. The legislature later countered with an 8.5 percent cut, or $57 million, but funding remains unsettled amid an impasse that has left the state without a budget since July 1.

One of the moves will eliminate a central account where money has been set aside to cover costs for the University’s backbone IT operating system, which is used for student accounts, human resources and business functions. In fiscal 2015, $12.8 million had been dedicated in the account for this purpose. That money will be used to help mitigate a potential funding reduction when a state budget is approved. The move, however, will force the University to postpone critical system upgrades and to borrow when the IT system needs to be replaced.

The other initiative will eliminate an $11 million account held centrally to fund critical deferred maintenance projects on the University’s three campuses. Chief among these are energy sustainability and repair/renovation of aging facilities. Those dollars will also be used to alleviate a possible budget cut, but the move will add to a massive backlog of deferred maintenance projects that threatens the University’s ability to deliver first-class teaching and research.

The spending reprioritizations are the latest in a series of cost-saving initiatives that Killeen has implemented to address ongoing declines in state support, along with a budget impasse that has shut off state funding for nearly a third of the current fiscal year.

Last summer, he imposed a hiring freeze in central administration that has reduced employment by about 20 full-time equivalents since July, saving more than $2 million. Based on that trend, officials say the freeze could possibly reduce employment by 72 and save more than $7 million over a full year. The University continues to review vacancies during the freeze to ensure that critical functions are provided.

In June, Killeen redirected $8.2 million in recurring funds from centrally held accounts to support financial aid and other student-centered programs on the University’s campuses in Chicago, Springfield and Urbana-Champaign. The funds were previously held in accounts under the direction of the president for various strategic campus and University-wide initiatives. In the recent past, these funds have been used for projects such as critical campus facility renovations and required information technology upgrades.

Killeen said the high-level committee will continue to explore cost-savings initiatives, and that similar efforts are underway on each of the University’s three campuses.

Like other public universities in Illinois, the U of I has been forced to rely more heavily on tuition and other revenue sources in the absence of fiscal 2016 state financial support. Presidents of the state’s nine public universities have joined others in calling for an end to the budget stalemate, warning that it is causing irreparable harm to the state’s 150-year investment in the universities that provide accessible, affordable and excellent college educations.


The University of Illinois is a world leader in research and discovery, the largest educational institution in the state with more than 78,000 students, 24,000 faculty and staff, and campuses in Urbana-Champaign, Chicago and Springfield. The U of I awards more than 20,000 undergraduate, graduate and professional degrees annually.