Illinois colleges are running out of cash amid state budget battle

western illinois university
At a board meeting earlier this week, Western Illinois University decided to lay off 30 teachers.

Illinois' public colleges are taking drastic measures to stay afloat.

Thirty teachers at Western Illinois University were laid off. Hiring is on hold at Kishwaukee Community College and faculty were asked not to travel. Chicago State University says it won't be able to pay the bills after March 1.

And that was all in January. Struggles could worsen as the state begins its eighth month without a budget. Lawmakers remain deadlocked, which means that Illinois' 12 public universities and 48 community colleges haven't received a dime of state funding -- which can account for as much as 30% of the budget at some schools.

The spigot has been turned off at a time when state colleges were already tightening their belts. Many have received less and less state funding each year, and seen a decline in enrollment.

"The current and the unprecedented state budget impasse further compound this difficult situation, requiring the University to make difficult decisions to address the serious challenges facing our great institution," said Western Illinois University President Jack Thomas, at a board of trustees meeting earlier this week.

On Monday, the board approved the layoffs of 30 faculty members, which comes after six non-teaching staff members were let go last year.

Some of them may have seen this coming. Enrollment has declined 25% at the school since 2006, reducing the amount of tuition revenue coming in. And funding from the state has been cut almost every year since 2009. Last year, it was 18% lower than its peak in 2002.

Related: Illinois paid lottery winners before college students

To make matters worse, Western Illinois -- along with many other colleges -- is funding an added expense this year as a result of the budget stalemate. Without a budget, grants awarded to low-income students were never paid and the schools are covering the cost until the money comes in. That amounts to $11 million at Western Illinois.

"At the end of the day, if there is no action, it will be the students and the employees that get hurt," said Tom Wogan, a spokesman at Chicago State University, which could run out of money come March.

Wogan doesn't expect the school to close, as it has a "moral and legal obligation" to make sure students can finish the semester. To stay open, it may try to take out a loan or renegotiate with unions on faculty pay.

Kishwaukee Community College is trying a long list of ways to cut costs and stay afloat until this year's funding comes in. It placed a moratorium on out-of-state travel and reduced the budget for on-campus student jobs. It cut department budgets by $200,000, which could mean no new office supplies and a lot less printing. Many colleges have put construction projects on hold and put a freeze on hiring.

Related: Stranger pays it forward to Illinois college student

Not every school is such bad shape. The University of Illinois, which has three main campuses and is the biggest college in the state, has seen enrollment grow in recent years. It counts on the state for about 15% of its budget, but also has a strong alumni network and an endowment of nearly $2.4 billion.

"Clearly this is not an optimal situation, but we're a strong university and have so far been able to handle the situation," said Christophe Pierre, the vice president for academic affairs at the University of Illinois.

To some degree, the situation isn't all that unusual. The state has been late in handing over funds in previous years, even when the budget was approved in a timely manner, owing as much as $500 million to the University of Illinois.

"We have been prepared to use our money to pay bills before," Pierre said. "But it doesn't mean we're not feeling the pain," he said.

Personal Finance


CNNMoney Sponsors