Possible Study, Cuts to Budget Concern BOG

Several BOG members said they are concerned about a request from Gov. Mike Easley to look for ways to generate savings because of a drop in state revenue.

During his University Day speech Friday Easley said state revenue might end up $700 million below projections. To cover the fiscal deficit, officials said last week, the system's budget might be cut by 4 percent -- a total of about $72 million.

But in a Friday press release, Easley stated that he would try to limit the cuts. "I have not asked the university system, community colleges or the public school system to make 4 percent cuts in their budgets," Easley said. "We are asking them to work with us ... and come back with a plan for generating savings."

Easley also announced last week that a construction freeze instituted earlier in he year will continue, meaning the UNC system could lose about $57 million in funding for repairs and renovations. But if the economy picks up, the construction freeze and threatened budget cuts could end.

J. B. Milliken, UNC-system vice president of public affairs, said Easley's staff told system officials to expect a 4 percent budget reversion. "Since then (UNC-system) President (Molly) Broad and Governor Easley have spoken, and he expressed his strong interest in working with her to avoid cuts in academic programs," he said. "We are heartened by the governor's assurances that he wants to work with us."

Broad said budget cuts would harm UNC schools. "There simply is no way of absorbing cuts of this magnitude without impacting day-to-day operations."

BOG member Brad Wilson said the cuts endanger the obligation board members have to N.C. citizens. "Last November, the university entered what I would deem a social contract with the people of this state," he said, referring to the $3.1 billion bond referendum for capital improvements. "We're now charged with doing (the bond projects) in a timely and efficient manner. (A budget cut) threatens our ability to fulfill that."

BOG members said they also are concerned by the timing of a legislative study now under consideration in the N.C. House, and the chance it might weaken the board's powers to run the system.

The legislative study, passed by the N.C. Senate, would examine the BOG's size, effectiveness and governance powers.

BOG Chairman Ben Ruffin said he thinks the study will focus on whether the board's size should be reduced. The board is composed of 32 voting members and 2 nonvoting members, including a student.

Ruffin said the committee structure keeps everyone involved and the membership adds to geographical diversity.

Wilson repeatedly said board members and UNC-system officials should not have to spend time on a study when the system is facing a multitude of problems -- possible budget cuts, a $2.5 billion construction program and enrollment growth.

But he said that if a study is undertaken, the board's past actions will justify its existence. "The conduct and efficiency of this board should be Exhibit A in the event of a study," Wilson said.

BOG member and former N.C. Gov. James Holshouser, who could not attend the meeting, submitted a letter outlining his concerns. "The kind of study proposed by the Senate would open up the door to anybody who has an ax to grind with any part of the University," Holshouser wrote.

Ruffin urged members to lobby against the potential study. He also said board members should question the purpose of the study. "There's no question this board has served well," Ruffin said. "There's no question the General Assembly has the right to do the study. But when you start tampering with a system that's the envy of the nation, of the world, it makes you pause and ask why."

The State & National Editor can be reached at stntdesk@unc.edu.