Budget cuts reach $60 million

Story reprinted from July 9 issue of The Daily Tar Heel.


Chancellor Holden Thorp has told the University to prepare for a $60 million cut to University funding.

Although the specific areas where cuts will be made are still being determined, administrators said there is no question they will have a significant impact on the campus.

“We’re treating these targets as actual cuts because they are realistic given the state’s current dire situation,” Thorp said.

The new number represents additional reductions to the 5 percent cuts Thorp asked administrators to create plans for in March, and which began with the fiscal year’s start on July 1.

That 5 percent cut was doubled Wednesday at the request of UNC-system President Erskine Bowles, totalling a $60 million budget reduction.

The cuts would come from state appropriations, which currently represent roughly one fourth of the University’s funding, as determined by the N.C. General Assembly. The 10 percent cuts fall between recent predictions of how the state’s budget will turn out once it is passed by the General Assembly and approved by Gov. Bev Perdue.

Thorp said the new 5 percent cuts will not necessarily be made campuswide. A budget committee comprised of Provost Bernadette Gray-Little and Vice Chancellor of Finance Dick Mann will work to decide where the cuts will be made.

Elmira Mangum, senior associate provost, and Roger Patterson, associate vice chancellor for finance, will assist. And Bruce Carney will replace Gray-Little once she steps down tomorrow to move to the chancellorship at the University of Kansas.

One of their first focuses will be finding areas to cut that affect as few classes as possible.

Once the cuts are distributed, decisions on reductions to specific schools and departments will fall to their respective deans.

Although those deans don’t know what level of cuts they will be dealing with, they are already preparing with frequent planning and meetings with other administrators and senior faculty.

“Any additional cut will affect the school,” said Jack Boger, dean of the School of Law.

“It depends on where the axe might fall. All of this will restrict or circumscribe the service we offer to students and faculty. The question is how much.”

Karen Gil, dean of the College of Arts and Sciences, said her first cuts would focus away from employees by suspending major equipment or renovation projects in different departments.

But Gil and other deans said a majority of the state appropriations they receive may go toward faculty and staff salaries.

Most deans agreed that they won’t be cutting any classes for the fall semester, with students already registered.

Alternate sources of revenue to make up for lost state money are scarce. Finances from grants and private gifts often come with specific requirements for their use.

Boger said areas outside of the sciences don’t have as many outside organizations to turn to for extra funding, and that even those groups are reeling from budget cuts.

Some budget decisions may be made by legislators instead of UNC officials. Administrators have been fighting to regain control of specific cuts mandated to areas such as research centers and institutes on campus.

They argued that they were better informed when it came to determining where budget cuts would have the least impact.

Thorp said administrators now expect more flexibility in where those cuts will be made. But Bowles has asked campus leaders to still stick to government recommendations as closely as they can.

A private gift was made to UNC in order to hire the services of financial consulting firm Bain & Company.

The firm conducted hundreds of interviews and spent months on campus doing research.

Their final report with potential cost-cutting suggestions and fiscal recommendations for University administrators will be presented to the Board of Trustees at the end of July.