January 26, 2009
Budget Update
To the Campus Community,
At last week’s All Campus Meeting, the Chancellor previewed with us the fact
that, due to the worsening economic picture for the State, we would soon be
required to restrict spending even further than we had planned. Soon after
the All Campus Meeting, we received official notification from the Office of
State Budget and Management (OSBM) of an additional 2% budget cut to the
current fiscal year, with some specific guidelines for restricting spending
in the areas of purchasing, travel and vacancies.
Since this new cut will take effect February 1st, we again had a very short
timeframe in which to consider how this might best be accomplished. Informed
by the first six months’ budget activity, the Chancellor has consulted with
Senior Staff, who have, in turn, been consulting with many of you, and will
continue to do so in the coming weeks. I am writing to review what
strategies we've employed so far this year and to let you know what
additional strategies we have developed for meeting this new challenge.
First, I'd like to review what we've done so far this year.
You will recall that last semester we established a series of priorities in
order to meet the initial 4% cut ($1,365,000) to the current year’s budget.
♦ The highest of these priorities was to optimally preserve the high quality
education and learning experiences we provide to students. We determined
that the best way to do this was to preserve the jobs and salaries of our
faculty and staff, whose teaching and service to the community are the
foundation of the UNC Asheville student experience.
♦ Since personnel costs
account for more than 80% of our total budget, departmental operating
budgets absorbed a disproportionate percentage of the budget cut. Most
departments cut 15% from their operating budgets, while academic departments
cut 10%.
♦ In addition, we began
holding off on filling most vacant positions, a strategy that allowed us to
accumulate over $300,000 in staff lapsed salaries. Provost Fernandes worked
with the faculty to identify several faculty searches that could be delayed,
garnering additional savings. These strategies, though painful, allowed us
to maintain our educational programs and manage the 4% budget cut.
♦ We asked people to be
more conservative in authorizing travel and purchases that might not be
critical.
♦ Although we knew that temporary employment would need to be limited, we
asked departments not to cut student jobs, whenever possible.
As of January 15, 2009:
The additional 2% we have now been mandated to cut from this year’s budget
represents an additional $682,500 and comes at a time when there are only
five months left in the year. In addition to this 2% actual budget cut, for
a total of 6% this year, we have been asked to reserve an additional 1% in
anticipation of future cuts, for a total of 7%.
This will require a considerable shift in our thinking as well as in how
we do our work. To achieve a 4% cut, we used great caution and entered a
time of conservative spending; to achieve the new 6% cut, and prepare for
the possible 7% cut, we will assume that the default answer is "no" in a new
time of drastically curtailed spending, and in some instances, curtailed
activity as well.
It will be important to remember that our decisions will be guided by the
same priorities going forward, even though the magnitude of the cuts has
increased. We believe that the following strategies, in accordance with the
Office of State Budget and Management guidelines, if managed responsibly by
all of us, will help us meet that goal.
Purchasing:
♦ Purchase Orders that will require the expenditure of University funds will
be issued for goods or services only in the most mission-critical or
health/safety situations. Further, all employees are asked to consider the
fact and the perception of their appropriate stewardship of all University
resources when making decisions about exceptions to this directive.
♦ Purchase of supplies, equipment, and materials that are needed for
classroom instruction will be permitted.
♦ All other purchases are considered exceptions, and must be approved in
advance at the Vice Chancellor level.
Travel:
♦ Travel and
training expenditures that require the use of University funds will be
restricted to the most mission-critical situations, or those involving
public safety, public health, job requirements, and emergency situations,
except as specifically approved by the Vice Chancellor as an exception to
the OSBM directive.
♦ Effective
immediately, any travel must be approved by the Vice Chancellor prior to any
travel arrangements or commitments being made.
♦ This guidance, at the State and University level, clearly requires good
judgment. We expect that any travel or training that is approved will show
clear relevance, cost effectiveness and appropriate restraint. All employees
are asked to consider the fact and the perception of their appropriate
stewardship of all University resources when making decisions about
exceptions to this instruction.
Hiring/Employment:
♦ Hiring of permanent employees will be suspended in all but the most
unusual and critical situations – generally these will be those instances
that directly affect the educational enterprise or the immediate safety of
the campus. Departments with current vacancies or pending retirements should
consider how best to accomplish their highest priorities without filling
vacancies for the foreseeable future. Decisions regarding exceptions to this
instruction will be made by the Chancellor in consultation with Senior
Staff.
♦ Hiring of temporary employees will be significantly restricted, and will
require approval in advance by the area Vice Chancellor.
♦ In order to preserve as many of the jobs of ongoing employees as possible,
our temporary employment spending will need to be reduced. Each Vice
Chancellor will be reviewing the temporary positions in their areas, and we
will be looking for ways to reduce this expense, while preserving student
employment to the greatest extent possible.
♦ Many employees have asked to explore voluntary reductions in schedules in
order to preserve jobs on campus. Though this may not be possible in all
cases, we will help employees explore the full impact of such choices so
they might make good decisions for themselves as well as for the University.
In the coming months, we will continue to explore and investigate other
options for longer-term savings, based on the many suggestions and
recommendations submitted to me by many of you in the last few months.
If you have any questions about how these new restrictions will affect your
work or your department, please consult with your manager, director, or vice
chancellor.
John Pierce
Vice Chancellor, Finance & Operations
January 26, 2008
