Regents could allow universities to borrow money for bonuses

The state Board of Regents will consider allowing South Dakota’s six public universities to borrow money to provide the 5 percent one-time bonuses that Gov. Dennis Daugaard and the Legislature authorized for all state employees.

Regents Executive Director Jack Warner is proposing the loans come from the student tuition reserve. They would cover about $1.9 million of a much larger shortfall facing the universities over the bonuses.


The estimated cost of the bonuses throughout the state’s university system is nearly $11.9 million. The Legislature appropriated $5,161,357 in general funds to pay for the bonuses to university employees whose jobs are under category of revenue.
 
The universities must come up with the rest.
 
The proposal that the regents will consider during their meeting Wednesday and Thursday in Aberdeen calls for that remainder to be covered by an assortment of revenues. They include:
 
Nearly $2.4 million from student tuition.
 
More than $1.3 million from student fees.
 
About $910,000 from federal sources.
 
About 187,500 from room and board.
 
Nearly $1.9 million from other sources.
 
In his briefing paper for the regents, Warner said the universities need the flexibility to use loans because they have already endured years of budget cuts.