The University of Southern Maine will face more financial difficulties in the next budget cycle, and other campuses in the University of Maine System could face similar problems without significant changes, interim USM President David Flanagan told the finance committee of the board of trustees on Monday.

“All this sacrifice, all this angst at the university, including the shattering of the view held by many down there and throughout the system that when you had tenure you had a job forever, that was shattered on the rock of fiscal reality,” Flanagan said during a meeting at the system’s offices in Bangor.

In the past year, he has overseen deep cuts at USM aimed at closing a $16 million budget gap, including the elimination of 51 faculty positions and the elimination of five academic programs.

“Despite all of that, what we’ve done, at best, is bought you a year. If there aren’t some significant changes made in the upcoming year, you’ll be in the same position with USM and perhaps other colleges as well,” he told the trustees.

Flanagan and the other system presidents were presenting their proposed budgets for the fiscal year that begins July 1. Flanagan plans to use $1.6 million in campus reserves to balance USM’s $127 million budget.

System officials said it will take $9 million in emergency funds to balance the proposed systemwide $519 million budget, which already includes deep cuts, including 206 positions systemwide.

Five campuses face deficits in the coming fiscal year: $2.6 million at UMaine Presque Isle; $1.5 million at UMaine Fort Kent; $1.5 million at USM; $1.3 million at UMaine Machias; and $561,000 at UMaine Farmington. The system office has a $1 million deficit. Only the University of Maine in Orono and UMaine Augusta do not have a budget gap.

Officials say the years of ongoing budget deficits have been the result of flat state funding, declining enrollment and three years of tuition freezes.

State funding could go up this year. Gov. Paul LePage’s proposed budget, which is being debated in Augusta, would increase state funding for the system by 1.7 percent, to $179.2 million, for the fiscal year ending June 2016; and by 1.93 percent, to $182.6 million, for the following fiscal year. That’s about half of what the system requested.

The finance committee will take up the budget at its March 4 meeting and forward its recommendations to the full board of trustees. The trustees will vote on a systemwide budget at their May 17-18 meeting in Machias.

To balance the budget, the trustees could also raise tuition.

Rebecca Wyke, the system’s vice chancellor for finance and administration, told the trustees that a 1 percent tuition increase would equal about $2 million, but of that, about 25 percent, or $500,000, would have to be set aside for financial aid.

“That’s a discussion we have to have,” said Samuel Collins, chairman of the board of trustees. “I think we need to have a discussion about the political feasibility of raising tuition and how that might affect our funding from the Legislature and the governor’s support.”

Collins and other trustees have said they do not want to raise tuition, particularly since the current rate already amounts to 18 percent of Maine’s median household income of $50,487.

Before the freeze, there were years of increases. At Orono, in-state tuition and fees increased 66 percent in the last decade, from $6,394 in 2005 to $10,606 today.

Wyke said time would be set aside for the trustees to discuss the tuition issue.

“We need to be careful how we have that conversation,” Wyke said. “The governor has been generous. … I think we need to be respectful about the intentions behind that.”

SPELLING OUT THE CHALLENGES

Flanagan spelled out what he thought were the challenges to the system.

“The down demographics, the fragmented ad campaign, the illogical application of scholarship money, the failure to adopt efficiencies in a true, unified budget are likely to result in problems in the budget in future years,” Flanagan told the committee.

Fixing it would take centralizing more support functions, eliminating duplicative majors and programs across the system, and establishing productivity standards, such as setting minimum numbers of courses faculty must teach and establishing certain faculty-student ratios, he added.

Flanagan, who was appointed president for one year, was not available after the meeting to elaborate on his comments regarding what USM faces next year. The campus has had years of multimillion-dollar deficits and scores of layoffs for the last several years.

USM is on the verge of announcing a new president, who is expected to take office by July.

“(Flanagan’s) ringing the alarm bells, which is appropriate because we need a sense of urgency,” Collins said after the meeting.

The system is already working to consolidate administrative functions and is in the midst of a comprehensive review of academic programs across all seven campuses.

“He has advocated for the direction we are taking,” Collins said. “I think we are making progress. … We do need to progress more rapidly.”

Also Monday, the finance committee voted to recommend the sale of some property in the system, including the system headquarters at 16 Central St. in Bangor and seven USM properties known as the “white houses,” former personal residences on the edge of the Portland campus that now house staff and faculty. The committee also endorsed the idea of the University of Maine in Orono selling about 30 acres of undeveloped land, with road frontage on Stillwater Avenue, and UMaine Machias selling Kimball Hall, which houses faculty offices and a small dining area.