Analyst says U's administrative costs are 'main culprit' in budget

The "main culprit" in the University of Minnesota's budget crisis is not falling state funding or professors' pay, according to a review by a faculty-hired auditor. It's administrative expenses, he said.

Howard Bunsis, a finance expert hired by the University of Minnesota chapter of the American Association of University Professors, told faculty Friday that the U is in strong financial standing, and that one-time pay cuts were unnecessary.

He said the U's administrative costs have soared, while instructional expenses have fallen as a share of overall spending.

"What I find most disturbing is that instruction was 26 percent in 2006, and now it's only 23.2," he said.

Bunsis has carried a similar message to campuses across the country. A news article about his analysis of San Francisco State University, for example, included similar themes. Bunsis is an accounting professor at Eastern Michigan University, a lawyer and an AAUP officer.

Richard Pfutzenreuter, the University of Minnesota's chief financial officer, attended Bunsis' presentation, saying afterward that he has "good data and bad data."

He took issue, in particular, with Bunsis' definition of administration. Bunsis grouped the following expenses into administration: public service, academic support, student services and institutional support. (See chart below.)

"I find it a little absurd that he would call public service an administrative cost," Pfutzenreuter said. "I just flat-out reject that."

Bunsis measured instruction in proportion to the rest of the budget. Pfutzenreuter said that's inappropriate, given that the U is bringing in and spending more on a research -- a good thing. He also referenced a column he wrote for the Minnesota Daily that explained some of the increases in "institutional support."

Bunsis concluded his talk by encouraging faculty members to fight against cuts to the core mission and instead advocate for reductions in administrative costs.

"I think we should always be skeptical and persistent."