Finance committee talks budget, University Square

Today the audit and finance committee of the Board of Trustees heard administrators speak about both the uncertain effects of the pending state budget on the University and a vision for the future of University Square.

Waiting for the budget

Administrators are uncertain about what comes next in the University’s fourth year of budget cuts until the legislature finalizes the state budget.

After the House approved a 15.5 percent cut for the UNC-system, the Senate proposed a cut of only 12.4 percent.

But that translates to about a 13.5 percent cut for the University’s academics, said Dick Mann, vice chancellor for finance and administration.

He said some of the state-appropriated funds are tied to non-academic areas, such as building repairs.

“We’ve taken a five percent cut already,” Mann said, in reference to the self-imposed cut the University instated earlier this year to prepare for the state’s budget.

“As we get into double digits, this becomes a very painful and difficult set of reductions for the University,” he said.

Raising tuition was discussed as a way to alleviate the impact of the cuts.

“It’s been tuition that’s usually had to balance that out,” said Chancellor Holden Thorp.

But Mann and Thorp said they were uncertain if a supplemental increase will happen.

“We’ve got a new Board of Governors and we don’t know the outcome of the budget process yet, so all that is yet to be determined,” Thorp said.

Mann said non-academic areas have borne the brunt of the three previous years of budget cuts.

He said that some departments, like facilities, are dealing with 35 percent cuts.

“Support areas are tapped out,” he said. “We’re running out of state money in those units.”

A vision for University Square

Two years after the University purchased Granville Towers and University Square, plans for the area’s redesign will be submitted to Chapel Hill for approval.

Gordon Merklein, executive director of real estate development, presented a plan to either renovate or tear down and rebuild all the buildings in the city block.

The new design includes front-facing stores on Franklin Street with residential and office space above, an underground parking deck and an entrance/exit on Cameron Avenue. Granville Towers will remain largely untouched except for ongoing inner renovations.

The occupancy of Granville Towers, which can house up to 1,300 students, has risen from 71 percent in the 2009-2010 school year to 99 percent this coming fall, Merklein said, attributing this increase to a marketing push.

He said the University will submit a special use permit to Chapel Hill in June, and approval could take between 18 and 24 months.

Merklein said the University has been in contact with all the tenants of the current retail space, and there are no current decisions on which retail stores will remain and which will move elsewhere.

“Two years is a long time from now from a retail perspective,” he said.