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Universities across the country feel the impact of their
budget cuts
With the academic year under way, colleges and universities
across the country are dealing with the tangible effects of budget cuts. Like
Carolina, most universities have targeted cuts to protect classrooms and
teaching where possible, although the scope of the cuts varies widely among
schools.
At Carolina, state funds make up about one-fourth of the
operating budget. Permanent cuts of nearly $39.3 million equaled about a 7
percent reduction in state funding this fiscal year. Coupled with a 5 percent
holdback Gov. Beverly Perdue called for beginning last month, Carolina’s state
funding has been cut more than $60 million.
To prepare for the cuts, the University had enacted a total
10 percent permanent cut in state appropriations effective July 1.
Administrators have been optimistic that those cuts will handle the total state
reduction.
That does not mean the University escaped unscathed.
Research centers and institutes have seen reductions of 17 percent to 23
percent, and jobs have been cut University-wide – some through unfilled
vacancies, others through eliminating filled positions or ending appointments
(current information is posted on the Carolina Budget Information Web site,
universityrelations.unc.edu/budget).
To pinpoint operational cost savings on their campuses, both
UC-Berkeley and Cornell recently have hired Bain & Company, the firm that
helped Carolina administrators identify ways to streamline operations and
increase efficiency (refer to universityrelations.unc.edu/budget for more
information). Below are some of the other measures universities are taking as
well.
Public universities
University of California system: UC is facing
a budget gap consisting of $368 million in mandatory costs that the state was
unable to fund plus unprecedented state budget cuts of $814 million in 2008–09
and $637 million
in 2009–10.
Administrators are considering enacting a mid-year fee
increase this year and fee increases for 2010–11, yielding up to a 30 percent
tuition increase by next fall. In addition, UC system campuses have begun
cutting programs, staff and faculty recruitment.
An employee furlough program is expected to make up for 25
percent of the deficit. Furloughs ranging from 11 days to 26 days are based on
a sliding scale; employees who earn more will take more furlough days. The
furloughs will amount to pay reductions of
4 percent to 10 percent, depending on the employee’s salary range.
University of Kansas A combination of a state funding
reduction of slightly more than 7 percent with unfunded university mandates
equaled cuts of more than 8 percent. Administrators said the university and
medical center would have $23 million less to spend in fiscal 2010 than was
appropriated in fiscal 2009.
University of Michigan By improving operations, holding off
on equipment replacement and eliminating jobs through attrition or unfilled
positions, UM made cuts totaling $15.2 million.
Other cost-saving measures, expected to save an estimated $9
million annually, include discontinuing the university’s public television
station, reducing contributions to employee health benefits and enacting a
one-year waiting period for new employees to receive university contributions
to their retirement savings.
University of Virginia To handle an 8 percent decrease in
state funds, UVA officials have instituted hiring freezes among other
cost-cutting measures. That same level of cuts also applies to the College of
William & Mary, Virginia Tech and the Virginia
Military Institute.
State leaders have advocated making reductions on the
administrative side where possible to try to avoid the impact on education
programs or tuition.
University of Washington State funding was cut an
unprecedented 26 percent. Through increased tuition and federal stimulus
funding, administrators hope to reduce the cut to around 12 percent. The
university plans to take the bulk of its cuts in administrative and support
units rather than academic units.
Private universities
Cornell University Earlier this year, administrators
planned for a 10 percent budget shortfall stemming from reduced state funding,
a
27 percent loss in the endowment at the end of 2008 and a decline in gift
giving.
Trustees approved drawing down $150 million in reserves over
the next two fiscal years to strengthen cash flow. Cornell will reduce
expenditures by 5 percent ($50 million) in Ithaca and 8 percent ($13 million)
at Weill Cornell Medical College in New York City. An additional 5 percent cut
is targeted for July 1, 2010.
Duke University With its endowment down 24 percent, Duke
has taken several measures including curtailing external hiring, eliminating
many vacant positions and introducing a voluntary retirement incentive program
for staff. Faculty hiring has slowed, and undergraduate tuition, fees, and room
and board were increased by 3.9 percent.
In addition, Duke is converting much of its phone service to
Voice over Internet Protocol, which uses the existing computer network instead
of dedicated phone lines, to save an estimated $2.7 million per year at the end
of the two-year conversion process.
Stanford University Stanford's endowment fell from about
$17 billion to $12 billion, its largest loss in 120 years. Administrators have
frozen salaries, laid off more than 400 employees and
closed the physics library. Fifty open faculty positions will go unfilled.
Last December, officials announced a two-year austerity
plan, starting with a voluntary 10 percent pay cut for deans and top
executives. Administrators’ goal is to cut $100 million from the
$800 million general fund.
Yale University Yale’s endowment dropped an estimated 25
percent, to $17 billion. Administrators are reducing the 2009–10 budget by an amount equal to 7.5 percent of the salaries and
benefits of all non-faculty staff through attrition, reducing temporary
employees and layoffs.
Non-salary expenditures will be reduced 7.5 percent in
2009–10, with plans for an additional 5 percent reduction in 2010–11.
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