January 13, 2004
• Winter Break Recap
Men's basketball looks to
extend 11-game winning streak
Page 10
VoLUME 76, IssuE 15 Up in Smoke? ~
Louisville's proposed smoking
ban debate continues
Page 4
An Independent Student Newspaper www.louisvillecardinal.com
U of L prepares for further budget cuts S~~~aker au~it
- criticis:m continues By MALLORY BOWMAN
News Editor
Budget cuts will yet again strike the University of
Louisville's campus- and this time, it's with little to no warn­mg.
Governor Ernie Fletcher signed an ·executive-order two
weeks ago cutting higher education and other budgets by 2.5
percent this current fiscal year, counting for $45 million from
the state's higher education institutions:
The 2.5 percent counts for a one-time cut of more than
$8.1 million of U of L's total $500 million budget, and the
universiry must make provisions to accommodate that f
cut this semester.
Aside from preparing for the news that U ofL must
deal with a substantial cut this semester, Fletcher also
announced that higher education institutions would
need to plan to cut 2.5 percent from their budget per­manently
for next year's fiscal year. That cut will
account for $3.4 million of the universiry's bud­get.
In, a report released last week, U of L
President James Ramsey said the uni­versiry
is better prepared fo~ the per­manent
cut.
"Given the status of the state's
budget situation, we had anticipated
such a reduction and have been
working with units across campus
to handle this cut on a one-time
basis this year to allow for time to
identify-ways-to make the cut per­manent
with next year's budget,"
he said.
Together, the cuts will count
for more than $11.5" of the
universiry's budget, which is
a substantial blow, said U
of :Ls Director of Plan­ning
and Budget Mikt;
Curtin.
"We're just now getting into the planning mode," he said.
No definite plans have been released as to what may suffer
the $8.1 million in cuts this semester. Ramsey stressed that
the situation is subject to change, but the universiry has been
analyzing the situation since Fletcher's announcement.
"The $8.1 million is a very significant cut," he said. "We
weren't aware we would have to make those cuts in the cur­rent
fiscal year. Practically, we don't know yet what's going to
happen. We'll be working on this for the next several weeks."
Curtin said the universiry would rather suffer a one-time
cut than a permanent cut, and that the slash of $3.4 mil­lion
could affect several aspects of the universiry.
"This cut will possibly have the greater impact," Curtin
said. "This could include program reduction, services
to be pared back, possible rise in tuition, possible staff
layoffs and possibly a hold on some salary increases."
One aspect that students are the most concerned
with is tuition increases. U ofL has an estimated
tuition hike of 7 percent _for the next school
year, and the recently announced cuts could
raise that number.
Sophomore nursing major Jennifer
Wilson said the cuts could seriously af-feet
her financial situation.
"If tuition increases, my financial
aid and loans may not cover all of it,
so I'll probably have to pay some
extra money toward my tuition
now," she said. "But I guess since
nothing can be done about it,
we're all going to have to find a
way to deal with it and come up
with the extra money."
Some are questioning
Fletcher's decision to slash
higher education funds.
see BUDGET, page 3
.Photo caption
David Flores I Louisville Cardinal
By MALLORY BOWMAN
News Editor
Universiry of Louisville President James Ramsey and .the
U of L Foundation, Inc. continue to be under fire for alleg­edly
"narrowing the scope" of an audit conducted of former
President John Shumaker's spending, while at the universiry
from July 1995 to June 2002.
The audit was a response to Shumaker's questionable spend­ing
at rhe Uriiversiry ofTennessee and Connecticut.
U of L auditor~ who were contracted by the universiry's
foundation conducted the audit, which was launched inter­nally
i.n July. Since then, it has been reviewed by the state
auditor's office.
President Ramsey, also president of the foundation, in­structed
the internal auditors to look only at Shumaker's travel
and entertainment expenses. Because of the decision to have
only parts of Shumaker's spending audited, former Kentucky
Auditor Ed Hatchett challenged Ramsey's decision, saying
more aspects of hi.s expenditures should be audited in search
of Shumaker's p.ersonal spending on the universiry's founda­tion
account.
As a result of the review of the audit, Hatchett made sev­-
eral recommendations to the universiry:
• The boards should review and approve or disapprove the
expenditures listed on the quarterly reports.
• The quarterly reports should include a statement from
the president that original receipts are on file for each item
listed on the quarterly reports.
_ • The quarterly reports should include expenditures made
for Amelia Place, the president's home.
• The Travel and Reimbursement Policy requiring original
receipts prior to approving the reimbursement of expenses
should be enforced.
• The Travel and Reimbursement Policy should specify ap­proval
procedures applicable to the president.
• The Travel and Reimbursement Policy should be reviewed
to formally include a policy to address the use and documen­tation
of airline frequent flyer miles.
• The areas of possible expenditures by Dr. Shumaker that
were excluded from the scope of these audits should be exam­ined.
• The boards should ensure that all expenditures are rea­sonable
in cost, necessary, and non-personal in nature.
According to a report sent to the universiry on Dec. 5 from
Hatchett's office, Hatchett desired to look at Shumaker's pro­curement
card transactions; direct payments from universiry
accounts to vendors for travel, entertainment, or other ex
see AUDIT, page 2
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