Members of the Campus Community:
Last week, Vice Chancellor Chuck Wooten informed you that we have received word of a significant, potential budget cut. Weare in the process of preparing a plan for a possible cut of 7 percent. If implemented, this budget reduction would take placeJuly 1. Planning for this level of budget cut has been necessitated by expected tax revenue shortfalls in the state of North Carolina, and it has been ordered by the Legislature.
So that you understand the full context of the budget situation, it is important that you recall that this budget reduction comes on the heels of a 2 percent reversion in this academic year. Also, because of increases in utility costs, the university must budget additional funds for utilities. (The current state budget recommendation makes no adjustments for utilities.) In total, the budget cut, current year reversion, and increased utility costs represent approximately 9.5 percent of the current state budget. In round numbers, the operating budget of the University must cover potential cuts, reversions and increased costs totaling $5 million.
During the last several days, I have had an opportunity to talk with people from UNC’s Office of the President and theLegislature. While there is some hope that the planned 7 percent budget reduction is more than will be required, no one is suggesting that budgets will not be reduced. Additionally, we must plan for utility expenditure increases equal toapproximately 1 percent of our state budget.
Last week, I convened an emergency budget planning task force composed of the vice chancellors, college deans, and membersof my staff. It quickly became clear that we could not manage a budget reduction and reallocation of this magnitude byfollowing an “across the board” budget cutting procedure. The level of budget reduction is simply too large to be managed inthat manner. Instead, it was determined that the University would need to focus a plan around programmatic consolidation and reduction. Also, since the actual level of budget reduction is not known, we are preparing three scenarios: cuts of 2 percent, 4 percent, and 7 percent.
Because of the fundamental nature of the University, and because of the way in which North Carolina funds universities, it also is clear that any budget reductions must preserve the core academic programs. We exist primarily to educate our students. Budget reductions that have significant effects on our enrollment will cause additional budget cuts in subsequent years. Therefore, preservation of teaching positions has to be the first institutional priority. However, given the magnitude of the issue we are facing, it is not possible for us to handle it without affecting the number of faculty positions. And, even though the expansion budget contains a request for five faculty positions, there would be a net loss of faculty under two of the budget scenarios.
To assure that we handle this situation with as little personal pain as possible to members of the campus community, we willtake the following actions:
- All vacant SPA and EPA non-faculty positions are frozen. If there is a reduction in force (RIF), the SPA positions will need to be held open to allow employees in affected departments to transfer. Vice chancellors can apply to have EPA non-faculty positions released if necessary. SPA positions will remain frozen.
- I have requested that Vice Chancellor Rick Collings meet with the deans to create a list of priorities for faculty searches. It should be expected that some searches would be delayed to assure that positions are available to return to the state once the level of budget reduction is finalized.
- At the conclusion of pre-registration, all low-enrollment courses must be considered for elimination. It will be very important that academic departments work closely with their deans to assure that course offerings are streamlined. We should make every effort to assure that students can get courses they need to graduate, but optional courses should be delayed if enrollment does not warrant their being offered.
- We will immediately implement policies to minimize utility use. Specifically, thermostat settings must not be set above 70 for heat or below 78 for air conditioning.
- Effective immediately, we will implement the normal year-end procedures that require review and approval by the appropriate vice chancellor for all purchases. As a further step to this process, I am asking vice chancellors to delay all non-essential purchases from state funds until next fiscal year and to review outstanding purchase orders to determine if they are essential or if they can be cancelled. All the savings from these actions will be accumulated and carried forward into next year to assist in meeting our utility costs and, thereby, save jobs of current employees.
The current budget situation will be very difficult for this campus community and for The University of North Carolinasystem. To try to minimize your personal concern and worry, the vice chancellors and I will keep you informed of anychanges in the situation. Since I will be in Raleigh and Chapel Hill on a regular basis, if you have questions, please direct them to your vice chancellor. He or she will provide you with as much accurate information as possible.
Please also be aware that budget reductions tend to produce a great number of rumors regarding the situation. Please refrainfrom “passing on” rumors that you have heard. This can lead to a great deal of unnecessary concern and upset. If you hear arumor, please let your vice chancellor know so that accurate information can be passed on as soon as possible.
All of us who love this University and the members of this community will find this process very difficult. I appreciate your help and cooperation as we try to adjust to the current budget reality.