University of Nebraska President J.B. Milliken is urging the campuses to cut spending now to soften the impact the poor economy is likely to have on NU’s upcoming two-year budget cycle.

On Monday — the same day the U.S. economy was officially deemed to be in recession — Milliken sent NU faculty and staff an e-mail alerting them budget cuts likely are looming and that they’ll need to “work together to meet the challenges ahead.”

“At this time, we do not anticipate mid-year budget cuts; however, we must use the seven remaining months of this fiscal year to prepare for more difficult times ahead,” Milliken wrote. “First, we must reduce expenditures from now through June 2009, so we will be in a position to use unexpended funds to help manage in the fiscal year beginning July 1, 2009.

“Second, we must begin the difficult process of planning for a biennial budget that will likely require reductions.”

Milliken and the four NU chancellors met Monday to discuss budget strategies.

They did not emerge with a specific goal on how much they want to trim spending, Milliken said in an interview, but they did agree to work to free up funds from their current budgets that could help NU get through the next fiscal year.

“We have the opportunity to use these seven months to prepare for next year,” he said. “Every major area of the operating budget will be looked at and we will begin now.”

One big area: hiring. Most of NU’s budget goes toward personnel expenses, Milliken noted, so each chancellor will have to carefully evaluate the open positions on his campus.

The positions that will get filled, he said, are the ones that contribute to NU’s strategic goals — affordability, research, economic development and others.

Such focused hiring will help ensure the progress NU has enjoyed recently in key areas will continue, Milliken said.

NU has had four straight years of enrollment growth, for example, major increases in research expansion and record levels of support from the NU Foundation, the university system’s fundraising arm.

“There are many priorities that we will continue to pursue even in a difficult budget time,” Milliken said.

Campuses also will look to reduce other costs like utilities and travel, he said.

When NU endured significant budget difficulties earlier this decade, students shouldered four straight years of double-digit tuition increases.

With affordability a priority for Milliken — he announced one week ago an expansion of an NU financial aid program for low-income students — he said he’s hopeful such increases won’t happen again.

“While we will seek additional ways to enhance revenue, I do not believe we can be true to our mission and balance the budget with significantly higher tuition,” he wrote in his e-mail.

The next session of the Legislature, during which lawmakers will craft a two-year budget for the state, begins Jan. 7.

Though the economic downturn has not hit Nebraska as hard as other states, signs still point to a difficult biennium, Milliken said.

The campuses must pitch in, then, to be cost-effective while still fulfilling NU’s mission, he said.

“It’s important to keep in mind that the university is in a strong position and we will do everything we can to try to preserve that momentum.”

Reach Melissa Lee at 473-2682 or mlee@journalstar.com.