CHAPEL HILL (Nov. 19, 2020) – Anticipating a difficult budget year, the UNC System Board of Governors adopted budget and legislative priorities for 2021-22 today that reflect the core mission of the University System, but also its intention to reduce employees.
“I think we’ve been very modest with our ask,” board Chair Randy Ramsey said.
The board adopted budget priorities of at least $105-115 million in additional funds that Budget and Finance Committee Chair Jim Holmes said are meant to preserve the university’s core mission. Figures could be adjusted up or down as the state’s budget picture becomes more clear, he said:
- Enrollment growth: $60-70 million in 2021-22. Unlike many universities, UNC System schools increased enrollment this year and expect further increases next year.
- NC Promise: $15 million. In keeping with a state constitution mandate of low tuition, NC Promise offers in-state students tuition of $500 a semester at Western Carolina, UNC Pembroke and Elizabeth City State Universities.
- Building reserves to operate four buildings approved in the 2016 Connect NC bond referendum that will go online in the spring: $30 million. (Six more buildings funded by the 2016 bond issue are projected to begin operations in 2022-23.)
- Faculty and staff compensation on par with other state employees. UNC employees have received no state raises in two years and haven’t received a raise equivalent to other state employees in three years.1 Each 1% raise for university employees would cost $30 million.
At a committee meeting Wednesday, members voiced doubts about raises in the middle of a global pandemic recession.
“That just may not be realistic,” said former state budget director Art Pope.
“While I’m sympathetic to a salary increase, people should be happy they have a job,” said board member Marty Kotis.
Chancellors from the System’s largest campuses said that after years of inadequate raises, the compensation needs are real.
NC State Chancellor Randy Woodson said 500 employees at NC State alone have already been furloughed.
“Just in the past month, we’ve lost faculty to other universities because we haven’t been able to give them raises in three years,” Woodson said.
UNC Chapel Hill Chancellor Kevin Guskiewicz noted that enrollment is up at Chapel Hill and is expected to increase again in fall 2021.
“We need the faculty to be able to deliver what we’re promising to those students,” Guskiewicz said.
After worries a month ago that state revenues were shrinking, though, Holmes noted that revenues were actually 7.5% greater in October 2020 than in October 2019.
“This is certainly an area to be cautiously optimistic,” he said.
AMONG OTHER LEGISLATIVE PRIORITIES, the System is looking for ways to reduce personnel costs and spread them over time, as well as additional spending flexibility.
“While UNC does have some authority, we need additional flexibility so we can begin to make those decisions now,” said Drew Moretz, Vice President for State Government Relations. “We need to be making decisions now rather than wait for the budget cuts to come.”
The board endorsed several priority requests of state legislators:
- Human Resources flexibility:
- Expanded early retirement beyond faculty positions;
- Additional authority for furloughs;
- Flexibility for reductions in force and severance payments;
- Permission for state employees to continue using vacation and sick leave interchangeably through December 2021.
- Last year the General Assembly gave the University permission to carry forward 5% of budgeted funds from one year to the next. Use of those funds was limited to one-time repair and renovation projects. The University will ask legislators to allow those funds to also be used for one-time expenses from its response to the pandemic.
- In May, the General Assembly agreed to waive interest charges on past-due student debt through Sept. 15. The University wants legislators to extend that waiver while the pandemic persists.2 Moretz said the accumulated interest charges could prevent some students from returning to school.
1 https://www.northcarolina.edu/apps/bog/doc.php?id=65100&code=bog, pp. 2-3.
2 https://www.northcarolina.edu/apps/bog/doc.php?id=65100&code=bog, pp. 4-9.
Leave a Reply