Chapel Hill, N.C. — The UNC Board of Governors' finance committee on Thursday passed the University of North Carolina system's recommendations for tuition increases.

The full board is expected to vote on the plan Friday.

Under the proposal, in-state undergraduate tuition at UNC-Chapel Hill would go up $160, to $3,865, while tuition at North Carolina State University would increase by $93, to $3,953.

Each of the 16 campuses in the UNC system has had to reduce its budget this year by 6 percent because of a projected $2 billion deficit in the state budget, and tuition increases are one way to offset some of the reduced funding.

Last November, UNC-Chapel Hill Chancellor Holden Thorp recommended a 6.5 percent increase – the maximum allowed under a state-imposed tuition cap – which would have added $241 to in-state tuition bills.

But UNC President Erskine Bowles wants to limit the increases – and reduce the cap to 4.5 percent – because the recession makes it harder for families to pay bills.

During Thursday's meeting, Bowles also talked about the 2009-10 budget, saying there is no way to keep cutting funds without having to eventually affect employees with either furloughs, pay cuts or layoffs.

"We're going to have some pain here that we are going to have to deal with for a couple of years," he said.

That could mean larger classes and heavier workloads for faculty.

"It's going to mean lower retention and graduation rates because people can't get the classes they want," Bowles said.

The system still faces budget cuts of up to 7 percent from the state, which already has pulled $150 million from the system's annual budget to help erase the state budget deficit.

Bowles has said furloughs – which generally allow employers to force workers to take brief periods of unpaid leave – would help deal with the cuts.

Seventy-five percent of the system budget is for personnel. Furloughs and pay cuts would require state legislation and would have to be approved by the Board of Governors.