of the budget but he would advise limiting employee reductions as much as possible to maintain the University's ability to provide quality academic programming and to operate effectively and efficiently.

Mr. Rush discussed some options to consider for overcoming the $7 million shortfall including a permanent salary reduction based on annual income, restructuring the bookstore contract, an eight percent reduction in institutional financial aid, increased class sizes, the elimination of 45 staff and faculty positions, a tuition increase, and reducing operating costs. Mr. Rush reiterated that these points are only options for consideration and not the final determination at this time.

Regent Farris stated that the goal is to find $7 million for the budget shortfall and none of these options stated by Mr. Rush are concrete; they are targets that will be moved by the Board. Over the next two to three months, the Board will come up with a solid plan on how to reduce the budget.

Regent Farris then opened the floor for discussion.

Regent Fields asked if the Board would be able to ascertain what they are looking at when they receive the proposed budget. Mr. Rush stated that the goal is for the Board to have a budget they can use to make an informed decision and the restructured budget will be refined into smaller budget areas for that purpose. The ultimate goal is to present a package to the Board that can be used to see reports and trends over time.

Regent Burns inquired about how the percentages and other numbers that Mr. Rush presented were determined. Mr. Rush responded that everything is a starting point and that benchmarks may change as the Management and Improvement Plan progresses. He stated that staffing will be realigned to ensure best practice.

Regent Banks stated that KSU should consider instituting a pay scale and scrutinize double dippers, retirees who draw big salaries.

Regent Jantzen stated that any options that the Board chooses will affect people's lives. The greatest hope is to engage the faculty and staff because they know the particulars and can come up with creative ideas on how to manage these budget numbers.

Regent Patton asked how the Board will contemplate the role of the new president in the budget reduction process. Regent Farris stated that these measures will have to occur notwithstanding the new administration. The budget implementation will be in the final stages when the new president is hired and the new president should be on board before the final budget is approved by the Board in June. She also stated that some of these decisions may have contractual obligations that need to be resolved. The goal is to present the new president with a balanced budget. Dr. Thompson stated that any new president should know what the expectations are and the candidate will be chosen with that in mind.

Regent Walston asked if existing contracts will be scrutinized for cost reduction purposes. Mr. Rush responded that this is a key component of the plan to lessen the impact on staff.

President Stamps concluded the discussion by stating that the process of examining individual unit budgets has begun. The Vice Presidents have summited information about their unit's contracts and employees and this information will be used to start the focus