The University Students’ Council is projecting a $200,000 deficit and hopes to shore up its finances with a new budget tabled Wednesday.

Despite collecting over $3 million in student fees last year, the organization has grown bigger and faster than these fees can support, according to Sacha Kumar, vice-president finance for the USC.

Total projected income for USC operations broken down between services and retail. Subtractions are shown in red, surpluses are shown in green.

“We really are spending more and more each year and our fee structure is staying the same. That’s a problem,” Kumar explained.

The deficit, which could be as high as $300,000, was partly a result of poor budget planning. The projections made this time last year were all inflated, according to Kumar, with some USC-owned businesses expected to end the year more than $100,000 lower than projected.

Last year, budget planners hoped USC-owned businesses would bring in enough profit to help pay for ballooning costs elsewhere in the corporation.

“It came to the point where we were relying on money in our retail division to pay for salaries. And that should never be the case,” Kumar said.

Last year, InPrint was projected to end the 2011 school year with $86,000 in profit. Instead it will end in the red by over $13,000. The Spoke and Wave combined will end this school year more than $240,000 below projections.

In anticipation for the projected deficit, the USC started axing jobs within USC ranks months ago. Kumar said these full-time salaries and benefit packages became too strenuous to maintain.

“It was a bit of a shake-up, for sure,” Kumar said. “This problem would only get worse unless we made these cuts now.”

They also reduced some contracts from 12 months to 10, saying the summer workload was too light to justify full-year terms.

But this year’s budget isn’t just about cuts.

If council approves the proposal, the USC’s information technology department will see over $100,000 added to its budget line. Part of the money will be used to purchase reservation software, which would manage bookings for the renovated gym, according to Kumar.

Students supported adding $25 to their student fees to renovate the gym space in a referendum earlier this month. While this gives the USC about $600,000 in extra cash, the USC is still seeking a $2 million loan to pay for the construction.

“We’re just paying for it up front,” he said. “Construction companies won’t finance people. They need to get paid right away.”

Yearly interest on the loan will be $42,000. The construction is expected to be finished by September.

Students will be paying total student fees of $427.12, an increase that includes $25 for the renovation and $4.75 for other costs. The base student fee, which funds the majority of USC operations, remains unchanged.

Council will have two weeks to scrutinize the budget before voting on it. If passed, it must also receive a stamp of approval from Western’s Board of Governors.

Budget Highlights

Corporate Capital

Projected 2009/2010                           -$125,000

Proposed Budget 2010/2011              -$200,000

One of the major spending points of this year’s proposed budget is the $200,000 being allocated for internal capital for the USC to maintain itself. This amount represents the biggest single investment in the budget, should council approve it.

Of this funding, approximately $100,000 – $125,000 will be devoted to updating the USC’s information technology. This will take the form of updating servers, purchasing newer computers to replace the outdated ones some USC departments use and potential funding for a USC website update.

Part of this IT investment will also be used to update the out-of-date reservations software for booking space.

The remaining funds will be divided amongst the USC’s various departments. These divisions will depend on requests made, as well as the priorities of the USC as a whole.

Food & Beverage

Projected 2009/2010                    -$246,397

Proposed Budget 2010/2011           -$16,872

Going into this year’s budget, the USC’s main food operations — the Spoke and the Wave — were experiencing financial difficulties.

With the construction of the Spoke’s patio and ongoing renovations costing valuable summer business, the hope is this year the operation will experience a turnaround.

Similarly, the Wave is also aiming to slim down costs. Though it is still expected to run a deficit, next year’s budget is much more hopeful than this year’s projected loss. One of the tactics they will be using is attempting to make menu changes that combine ingredients – this way one ingredient can be used in several different meals.

Both operations are also aiming to strike on “the next CLT” — the next popular menu item that resonates with students. The Spoke has already talked about grilled cheese and pizzas, while the Wave is aiming to see what works during the summer and hopes to launch a new menu for the fall.

Media

Projected 2009/2010                        -$306,902

Proposed Budget 2010/2011            -$252,849

Since CHRW was moved to another budget line and tvWestern.ca’s budget line is at zero, the Gazette is now the main component of the media budget line.

One of the biggest changes this year is the allocation of $0.50 from the collected student fee that will go specifically towards the development of online media — especially video.

This change comes as a result of an acknowledged swing in the industry where online content is growing at a rapid pace. The additional money provided by this levy will provide the foundation for increased online development.

Other budgetary efficiencies were found by decreasing the current year-long term for Gazette full-time editors to 10 months, while the USC’s marketing department will be responsible for generating an additional $50,000 in revenue.

Retail Services

Projected 2009/1010                              +$107,176

Proposed Budget 2010/2011                +$119,316

There are several major changes to retail service operations outlined in this budget. One major change will be the Post Office moving into Mustang Alley.

With the exception of the Used Book Store and Purple Door Promos, all of USC’s retail service operations have been conservatively budgeted to sustain a loss next year.

This is due, in part, to the ongoing questions of how the USC should treat retail operations — balancing service to students against being profitable is one of the central questions of the USC’s guiding document.

“The goal of our operations should be to be revenue neutral,” Pat Duncan, USC councillor, said. “But just because they’re budgeted at a loss doesn’t mean they will lose money.”

tvWESTERN.ca

Fees collected 2009/2010              -$92,300

Proposed Budget 2010/2011                     -$0

As was shown in the general USC survey performed in 2008, 83 per cent of students surveyed (approximately 3,800) stated they had never watched one of tvWestern’s videos. Budget allocation was another factor leading towards the recommendation of eliminating tvWestern.ca’s student fee; currently, as much as 80 per cent of the operation’s budget goes towards salaries.

While this may be the end of the USC’s own TV station, it does not mean the end of video on campus. Student-created Big Purple Couch is expected to continue, and the USC has stated they will facilitate students who have their own video ideas.

“We need to ask how many volunteers are going to be affected,” Andrew Beach, USC councillor, said. “Are we losing the opportunity for students to get involved?”