University to Divide Budget Cuts Evenly

On Feb. 5, Gov. Mike Easley ordered all UNC-system schools to return 1.3 percent of their state funding as a result of the state's budget crisis. As part of the cut, UNC-CH must revert about $4.4 million.

Provost Robert Shelton said Thursday that the University's overhead fund will absorb one-fourth of the cost, leaving the remaining three-fourths of the cuts to be equally distributed by percentage across all University departments.

Shelton said the overhead fund -- which is used to pay for a variety of expenses such as repair and renovation costs and guest lecturers -- could not absorb the entire budget cut because the money returned must be state funds, preventing private contributions to the overhead fund from being cut.

"The only real question during our decision process was how much the fund could absorb," Shelton said. "We concluded that this was the most we could absorb centrally."

Shelton said the remaining cuts were passed on to each University department, with administrators in each department having the authority to determine how the cuts would be distributed within individual departments.

He said the amount each department would have to cut varied slightly but that almost every department would cut about 1 percent of its operating budget. "Basically, everyone took the same percentage," he said.

Richard Cole, dean of the School of Journalism and Mass Communication, said the school was able to absorb the cuts without cutting staff positions or faculty salaries.

Cole said the cut came from personnel money normally used to pay for part-time faculty or guest lecturers.

Dee Reid, communications director for the College of Arts and Sciences, said the dean's office was able to absorb an additional portion of the cuts by reducing non-personnel allocations -- funds used to pay for administrative equipment and office space costs.

Reid said that after the cuts were made to the dean's office, each academic department within the college had to absorb the remainder of the costs, which amounted to a cut of about 0.6 percent for each department.

The budget cut is the second Easley has ordered since November, requiring UNC-CH to revert a total of about $15 million to the state.

Laurie Charest, associate vice chancellor for human resources, said the combined effect of this year's cuts has forced the University to eliminate 15 occupied staff positions.

But Shelton said that because UNC-CH officials expected the state to make its most recent cut, each department had time to prepare for the funding loss.

"The good news is that we anticipated this," Shelton said. "We contacted each department last fall and told them, 'We expect this cut, so plan your budget accordingly.'"

Shelton said he does not anticipate that the state will make any additional budget cuts this fiscal year.

But he said he has warned each department that -- based on next year's projected state budget shortfall -- more cuts could be on the way.

"The question now is, 'How do we prepare for next year?'" Shelton said. "Next year, I think, could be even worse."

The University Editor can be reached at udesk@unc.edu.