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UNC system leaders tackle funding shortfall

Posted March 19, 2009

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— University of North Carolina officials warned Thursday that limited state funding could force the system's 16 campuses to lay off hundreds of faculty and staff.

Gov. Bev Perdue's budget proposal for 2009-11 calls for the UNC system to receive $168 million less than UNC President Erskine Bowles and campus chancellors had expected.

"This ain't gonna be no waltz," Bowles told university leaders during a Board of Governors meeting.

UNC System looking at 5 percent budget cu UNC System looking at 5 percent budget cut

Officials said the proposed funding could mean 400 to 500 layoffs across the university system. Most would be non-faculty jobs, but leaders warned of larger class sizes, fewer advisers, less maintenance and program reductions.

Bowles said chancellors need to roll up their sleeves and begin identifying possible cuts while he works with state lawmakers to give campuses more flexibility in where cuts are made.

"We agreed not to whine and not to complain," he said.

UNC-Chapel Hill Chancellor Holden Thorp immediately ordered all departments to make cuts for the coming school year equal to a permanent 5 percent loss in state funding.

"We'll make the reductions we feel that we can make now. That will preserve more jobs and more of our programs in the long term," Thorp said.

All state agencies, including university campuses, have been ordered to reduce spending by 7 to 9 percent by the end of June to help close a $2.2 billion deficit in the current budget. Thorp said that has cost UNC-Chapel Hill $36 million.

Projections call for state revenue to be short by $3.4 billion in the 2009-10 fiscal year, which starts in July, and lawmakers have just started to work with Perdue's recommendations to craft a state budget for the coming year.

A 5 percent cut amounts to a recurring $29 million loss for UNC-Chapel Hill, Thorp said, and likely would result in job losses. He said he couldn't foresee a scenario in which tenured faculty would be affected, however.

"I understand the pain that this information will bring to people who have devoted themselves to this university, and I am sorry that we have to take this step. I ask for your support and patience as we navigate this economy," he wrote in a memo to faculty, staff and students.

Bowles and the chancellors have asked for legislative approval to furlough university employees to save money, but it's unclear whether lawmakers will approve the idea.

North Carolina Central University Chancellor Charlie Nelms projected 50 layoffs at his Durham campus.

"It's always very difficult to make cuts because you're dealing with the lives of people, either students, faculty or staff," Nelms said.

Chancellor James Oblinger said cuts at North Carolina State University would lead to "serious pain on the operational side and ... pain as it relates to personnel."

Thorp said other university revenues, such as tuition, research grants and endowment funds, are restricted in how they can be spent. Also, UNC-Chapel Hill's endowment lost 16 percent of its value last year because of the downturn in financial and real estate markets.

The Chapel Hill campus has established an employee assistance fund for laid-off staff, and Thorp said he expects various services for those employees to be in place soon.

24 Comments

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  • kimmimom Mar 20, 2009

    Of course I don't agree with having to pay to park to go to work, so I can't imagine raising it more. I think my husband pays $40 a month as it is. Maybe we could charge everyone to park in the campus lots like visitors!

  • Raleigh Boys Mar 20, 2009

    Why not just raise parking $20.00 a month per employee? Would that not keep from laying people off.

    ... wait - that is a good idea, please do not let anyone see this posting. It might actually raise revenue.

  • discowhale Mar 20, 2009

    If the UNC System, and the State Gub'ment, would quit spending based on "projections", they'd (we'd) be better off. When Average Joe's salary gets cut, he has to tighten his belt. Oddly, these gub'ment people think it's Joe's fault when their salary gets cut, and the first idea is to raise taxes on Joe.

    Eliminate wasteful spending. I've worked in professional kitchens, in big hotel kitchens, that didn't have a $50K stove. That is not the only such incident I feel sure. I'll bet 5% could be saved by tracking down THAT KIND of silly spending.

    Hire an overseer for spending, make their salary based partly on savings.

  • ncguy Mar 20, 2009

    Yes go ahead and cut the guy who makes 30K and has worked for you for 20 years. We have to make sure Mary Easley gets her 200K salary.

  • kimmimom Mar 20, 2009

    I did not criticize Thorp personally, I just said that home did not need a $1 million renovation when the ecomony is going to be potentially laying off UNC employees (and other state employees), forcing furloughs, increasing class size, increasing health premiums, decreasing benefits, stopping longevity pay for 2 years, etc.

    The actual renovations did not begin until the old chancellor moved out and since by then the economy was already on the down turn, changes could have been made to the renovations such as maybe a 10K stove versus the 50K stove that was chosen. There were several other extravagant changes that could have been done cheaper while still upgrading the home.

  • FloydRTurbo Mar 19, 2009

    Renovations to the Chancellors Residence ..... the extravagances you refer to were initiated well before Thorp was in office. The only changes to accomodate his family were bedrooms for his small children (which previous Chancs did not bring to the residence).

    I repeat .... sniping criticism aimed at Bowles & Thorp personally is unfounded and too stereotypical to begin to justify. For the record, I vigorously opposed both Molly Broad & James Moeser. Being a defender of UNC admins is a role I never imagined myself being in.

  • Mustange Mar 19, 2009

    Go ahead cut maintenance and see how long it takes before it looks run down and starts to violate inspection codes.

  • kimmimom Mar 19, 2009

    I am sure Thorp's new residence did not need 1 million dollars in renovations, including a stove that was almost 50K (more than many people make in a year)! Other chancellors have cooked/entertained (not them literally, but their paid housekeeper/cook) in that home without such an extravagant stove!

  • gmarcum Mar 19, 2009

    Maybe our duly elected state gov't officials should lead by example and take a paycut first.That would be a good start!

  • FloydRTurbo Mar 19, 2009

    "cutting his pay"??? ..... as far as Erskine Bowles; he has, from Day One, given a larger portion if not all, his salary back to UNC. He has become quite wealthy in the private sector. Like CD Spangler before him, Bowles isn't in "it" for the $$$$.

    As for Holden Thorp .... he has been a career academic professor and administrator at UNC. He is not a man of extravagant tastes by any means. I am certain he will not ask or expect anyone to sacrifice any more than he will himself as their leader.

    There are a lot of changes I would make at UNC ..... it's two top leaders are NOT among such changes. Critics should focus their scrutiny elsewhere ....

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