SPRINGFIELD -- The presidents of Illinois' public universities received a bit of whiplash-inducing budget news this week.

After being told before Christmas to prepare for additional budget cuts from the state, Gov. Pat Quinn's office now says he wants to hold funding for higher education flat in the budget year that begins July 1.

Although that prediction could change once the General Assembly gets involved in budget talks, university officials say they are pleased with Quinn's latest flip-flop.

"I'm glad we may avoid that cut," said Southern Illinois University President Glenn Poshard.

The switch came within a two week span after university finance officials met with Quinn's budget office in a pre-Christmas powwow designed to outline the state's on-going financial woes.

In that meeting, universities learned they could face a 4.25 percent cut in state funds from the current fiscal year -- a move that could have triggered steeper tuition increases or cuts in programs or hiring.

At SIU, the proposed reduction would have meant $10 million less in a budget that already has seen a nearly $40 million cut in state funding in recent years.

"An additional $10 million would be devastating," Poshard said.

Illinois State University vice president for business and finance Dan Layzell said the latest news is positive, but it also is very early in the budgeting process.

"At this point its just kind of a watch and wait situation," Layzell said. "It's too soon to make any assessment of this yet."

Quinn budget chief David Vaught said the governor expects to cut most state agencies by about 9 percent in order to pay the state's annual employee pension obligation, which rises by more than $1 billion next year. Education and Medicaid funding would be the only programs held flat, Vaught said.

"The governor believes it's very important to keep education strong," Vaught said. "He wants to hold education level."

Other agencies -- ranging from prisons to parks -- could see further workforce reductions to accommodate the governor's plan.

"The agencies are going to have to deal with these squeezes," Vaught said.

The governor's latest proposal is a mini-preview of his February budget speech, which serves as a kickoff to the General Assembly's spring legislative session.

"This is where we think we should be and that's where we're headed," Vaught said.

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