Monday, May 10, 2010

President Smatresk's recommendations for program eliminations and reorganizations

Today President Smatresk announced to the campus his recommendations for program eliminations and for a significant reorganization and redeployment of faculty and resources. A summary of this plan, which will be considered by the Board of Regents next month, is here.

Here is some context for these proposals, from the Presidential Review Committee report.

In the annals of public higher education in the United States, the current budget crisis facing the Nevada System of Higher Education – and UNLV in particular – is unprecedented. Over the past three years, nearly one-third of state general fund support has been cut, while enrollments and demand for services to students have increased.

This budget crisis for UNLV began in fiscal year 2008 with an initial 6% reduction resulting from how the funding formula treated reductions in the rate of enrollment growth. During the 2008- 2009 fiscal biennium, UNLV experienced two additional budget reductions due to declines in state revenue leading to special sessions of the state legislature which enacted first a 4.5% reduction (which led to a 6 month deferral of merit pay for faculty in 2008), then by a 3.42% reduction for fiscal year 2009. Then in spring 2009, the regular legislative session passed a biennial budget for 2009 – 2011 which reduced UNLV general fund appropriations by a total of $32.8 million per year, including a 15.4% cut ($28.1 million) in formula funded appropriations, which support operations of the main campus. This budget also included an additional reduction of state appropriate equivalent to 4.6% of salary for all employees.

In 2007, in recognition that the 2009 legislative session would bring deep budget cuts, the campus began working on a budget cut plan, and we entered the 2009 – 2011 biennium with planned state-funded expenditures reduced by $15.1 million. However, state revenue in the first two quarters of fiscal year 2010 did not meet projections; by January 2010, the state had a 22% shortfall in revenue for the 2009 – 2011 biennial budget. In response, the state legislature in the special session of February 2010 enacted a series of one-time budget actions to help fill that hole, and it cut an additional 6.9% from the NSHE budget. This additional 6.9% base cut, combined with projections that state revenue will require even deeper cuts in the 2011 legislative session has led us to another round of planning to reduce expenditures between now and 2013.

To this point, 130 total positions have been eliminated from the academic faculty and professional staff, through retirements, vacancies or non-reappointments (i.e. layoffs), with another 265 positions being held vacant. Together, these represent a total of 15% of our total state funded positions missing from our classrooms, labs, libraries, and offices.

Of the $15.1 million that had been cut from base expenditures through January 2010, approximately 55% ($8.4 million) were taken from the academic affairs budget, with $6.234 million of those cuts coming from instructional areas (representing about 50% of the total cuts taken to date) and $2.166 million coming from academic administration, Libraries and Information Technology. Because academic affairs had previously accounted for more than two thirds (70%) of the total university budget, but only 55% of the cuts to date, reductions have been proportionally deeper for administrative and support areas. On a general fund percentage basis, previous cuts have ranged from highs of 45% for the President’s office; to 34% for Finance and Business; and to the lowest – 13% - for Academic Affairs.

During this period, enrollment grew by about 3% across campus, and student fees were increased sharply – on average, fees increased 48% for undergraduates and 59% for graduate students. Moreover, classified staff were subjected to unpaid furloughs worth 4.6% of their salary for two years (with approximately 150 classified positions being held vacant, creating heavier workloads to be accomplished in less time for classified workers). Professional staff and untenured faculty are absorbing a 4.6% furlough in fiscal year 2011, and tenured faculty are carrying a heavier workload by a comparable proportion (i.e., the financial equivalent of 4.6% in salary savings). In addition, cuts to the state health insurance program have resulted in higher out of pocket costs for all employees, amounting to a further cut in compensation. In short, a significant portion of the budget crisis is already being borne through across-the-board cuts.

In response to the recently enacted cut of 6.9% to state funding for UNLV for the remainder of the biennium (i.e., one third of fiscal year 2010 and all of fiscal year 2011), and with a high likelihood of further cuts to come in 2011, the president put in place a series of budget cutting plans intended to reduce expenditures by $10.7 million for fiscal year 2011, with the expectation that these cuts will continue or deepen by 2013. At the same time, fixed costs for the university are rising.

This has led the president to set a goal of $4 million in reduced spending from academic affairs and a total of $5.7 million from support areas. An additional $1 million is being cut from non-formula appropriates to the Law School, Dental School, Intercollegiate Athletics and other areas.

It is in this context of a prolonged, severe budget crisis that the current exercise in vertical cuts – i.e., elimination of entire departments or programs – has become necessary.

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