Easley Calls For 5 Percent Cut to UNC

The $14.3 billion budget calls for cuts to many state programs in an effort to fill a possible fiscal hole of about $2 billion.

Easley's budget will now head to the N.C. General Assembly, which also has begun to work on next year's budget.

At a press conference Tuesday, Easley touted his budget as one that will protect classroom instruction at all educational levels without raising taxes.

"Our commitment to education and protecting classrooms has been, and must continue to be, the central guiding force in shaping the budget," Easley said. "Education clearly serves that role in the budget I am submitting today. It trumps all other items."

Easley's budget does call for about a 5 percent reduction to the UNC-system's recurring budget, a total of about $90 million.

But that reduction is smaller than the proposed budget cuts for most other state agencies -- many of which are more than 10 percent.

Even though Easley proposed a cut beyond what some University administrators had hoped, UNC-system President Molly Broad said that with a 5 percent budget cut UNC-system administrators would be able to shield classroom instruction from feeling the impact of the cuts. "We have pledged that with a cut at 5 percent there will be no harm to classroom instruction," she said. "The core strength of this University will remain intact."

Easley's budget also calls for a net reduction of about 500 positions across the UNC system, but no permanent faculty will be eliminated.

Easley's budget does meet the University's full need for enrollment growth and need-based financial aid for the 2002-03 academic year, a total of about $80 million.

But there is a catch.

Easley's budget calls for revenue for the enrollment growth -- a total of $66 million -- to come from a statewide lottery, which Easley said he expects the General Assembly to approve this summer even though it has stalled in the state House several times in the last decade.

Expecting that state lawmakers would not be able to provide the full amount for enrollment increases, the UNC-system Board of Governors approved in March a tuition increase of 8 percent for in-state students and 12 percent for out-of-state students. The tuition increase would generate about $33 million in revenue for enrollment -- about half of the UNC system's total need.

While Easley's budget maintains a tuition increase at the level recommended by the BOG, the funds are not used directly for enrollment growth but instead are folded into the state's General Fund.

"We fully funded both enrollment growth and financial aid," said Deputy State Budget Officer Charles Perusse. "We did exactly what the UNC system asked."

Both Perusse and Easley said that should the state legislature choose not to implement a statewide lottery, the governor will work with lawmakers to find other means to fully fund enrollment growth.

"You cannot leave out enrollment increases for the UNC system. You deny a whole generation an opportunity to go to college," Easley said.

Broad also said she is pleased that the governor decided to fund the system's enrollment growth and said she is not concerned about how it is funded. "Really the means by which revenues are generated are in the hands of the governor and the legislature," she said.

But Broad said that while she is satisfied with the budget that Easley has proposed, she is certain that many changes to the budget will occur in the next couple of months. "I think that this is the first chapter in the story of the 2002-03 state budget," Broad said. "My guess is that we will have a number of chapters."

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