If the LSU System’s state funding is cut by 30 percent next fiscal year, all 11 institutions could feel the pain equally. But System President John Lombardi has an answer to the question, “Why did you do only across-the-board reductions?” if such a measure were to be enforced — an answer that has University Chancellor Michael Martin scratching his head. In January, the Governor’s Office predicted a cut to higher education funding could reach 30 percent for the fiscal year beginning July 1. The System’s “budget reduction exercise,” submitted to the Division of Administration on Feb. 4, showed what an across-the-board approach to a worst-case scenario budget cut would look like. For the University, the colossal reduction would mean a $71.9 million dollar reduction — the largest of the System’s 11 entities. In the exercise, Lombardi maps out his solution for easing the pain of hefty reductions — the creation of a System Performance Support Fund. “The fund means that the reductions are not rigidly across-the-board but that the system retains the capability of addressing differentials should they occur,” Lombardi told Martin in a Jan. 29 e-mail obtained by The Daily Reveille. Maintained by the LSU Board of Supervisors, the $1.7 million fund would be composed of 1 percent of state funds from each System institution. The University’s unrestricted operating budget for 2008-09 is $451 million.Adding a performance-based twist to an across-the-board budget cut solution, the fund would allow the Board to support initiatives throughout the System that improve efficiency or performance and would “accommodate issues that arise in adjusting to the mandated budget reductions,” according to the exercise. In the same e-mail, Lombardi said System officials had discussed at great length the method used to distribute the budget reductions to the different campuses. Some suggested the System use the new, performance-based Louisiana Board of Regents funding formula, while others suggested they distribute the cut based on the amount of other funding available to a campus, like tuition. “We resisted all these notions on the grounds that none of them seemed either wise or fair,” Lombardi said in the e-mail. “And we believed they would have significant negative effects for different campuses depending on how such differential distributions were calculated.”  The fund is just one of the many differences between what the University submitted for the “budget reduction exercise” and what was released by the System to the Division of Administration. System officials made several edits and omitted many of the University’s ideas and information. “We understand the attempt to respond as a system but in doing so the uniqueness of the role, scope and mission of each LSU entity is lost,” Martin told Lombardi in a Feb. 2 e-mail. In the same e-mail, Martin said he felt the System Performance Support Fund was a “poor response” to across-the-board cuts, citing the Board of Regents’ new funding formula as a better route to determine the allocation of resources.”We do not think the creation of a 1 percent System Performance Support Fund is a wise or fair inclusion at this time,” Martin said in the e-mail. Administrators won’t know the exact budget reduction until Gov. Bobby Jindal submits his proposed budget to the Legislature on March 13. Until then, System and University administrators will continue preparing for the worst. “Louisiana has only one flagship university, only one public Carnegie Research University — very high research activity — and only one public university ranked as a Tier 1 university in the recent U.S. News and World Report,” Martin told Lombardi in the e-mail. “We do not believe the LSU System response adequately points out the differential impact of these proposed cuts on the state in terms of research, teaching and economic development.” ——Contact Kyle Bove at [email protected]