TO: NC State Campus Community

FROM: James H. Woodward, Chancellor

The past several months have been extremely challenging for the NC State University community as we have worked with the Governors Office, the General Assembly, the Board of Governors, and UNC-General Administration to implement the various spending guidelines, budget reversions, and budget reductions. Recognizing that we needed to look long-term at the changing economic environment, the campus began last spring considering budget reduction strategies, as high as 18%. These larger reductions were considered in order to encourage us to look carefully at what we could do more efficiently or perhaps stop doing altogether. What is clear is that the budget reductions over the last decade have led to a severe lack of operating funds, resulting in an excessive reliance on lapsed salaries from vacant positions to fill the operating shortfall.

For Fiscal Year 2009-10, we were directed to prepare and submit to UNC-General Administration a 10% recurring budget reduction plan that totaled slightly more than $53 million. We worked closely with the Deans and Vice Chancellors to protect the academic core programs so that significantly lower reduction percentages would occur in the colleges than in the administrative support areas. That plan was subsequently implemented and incorporated the elimination of 440 positions, many of which were vacant because of our hesitancy to hire new staff over the last several months.

It is important to emphasize that the 10% budget reduction was intended to serve two primary purposes:

1. For 2009-10 it will cover the recurring Management Flexibility budget reductions required by the 2009-11 Appropriations Bill as well as the 5% reversion of State Appropriated funds required by State Budget Director in his August 14, 2009, directive. As a result, we do not anticipate further budget reductions for the current fiscal year unless the state’s economy worsens dramatically in 2010;

1. For 2010-11 it will cover an additional recurring Management Flexibility budget reduction and, if the state’s economy does not worsen, provide some restoration of funding for re-investment in new strategic program initiatives and to shore up operating requirements of core academic programs.

There has been considerable publicity and discussion regarding administrative positions at the campuses of the University of North Carolina. The number 900 has been frequently mentioned. The “900 positions” refers to the number of positions that UNC-General Administration estimates will be eliminated at all UNC institutions to meet the requirements of the 2009-10 permanent Management Flexibility budget reductions (including Centers and Institutes). NC State University has already implemented those budget reductions. Therefore, no further budget reductions or position eliminations are anticipated at this time.

As we continue to look for improvements for effectiveness and efficiency, we are undertaking a review of a broad set of university-level strategies. These involve policy and procedure opportunities ranging from purchasing methods as well as a variety of administrative processing procedures. I anticipate initiating several specific task force teams, made up of campus representatives, in the next few weeks to support this effort.

I appreciate the hard work, dedication, and cooperation of the campus community to develop the 2009-2010 NC State operating budget and to help prepare us for the financial realities of the future.

JHW/am

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Reductions in state funding to Centers and Institutes, along with other reductions to academic affairs and reductions to extension and research budgets, will impact the University’s core instructional, public service, and research functions.

Analytical Instrumentation Facility (AIF)
Established in 1923, the AIF provides NC State faculty and students access to micro- and nano-analysis instrumentation and to materials analysis professionals who can assist with training, instrument operation, experimental design and data analysis. The effect of personnel funding reductions will be less responsiveness to requests for services.

Center for Chemical Toxicology Research and Pharmacokinetics (CCTRP)

The Cutaneous Pharmacology and Toxicology Center was chartered in 1989 to "perform scientific research on the structure and function of skin focused on transdermal drug delivery, cutaneous toxicology, metabolism and pharmacokinetics employing innovative animal models and other pharmacokinetic research." This research led to the creation of the USDA-supported Food Animal Residue Avoidance Databank (FARAD) in 1981 and United Nations Food & Agriculture Organization-supported global FARAD. FARAD performs residue avoidance data analysis and provides assistance in preventing residues in animal-derived food across the USA and internationally. The Center was renamed the CCTRP in 2001 to reflect this dual mission. Graduate and post-graduate training programs in comparative pharmacology, general toxicology, and nanotechnology produce health scientists for academia, industry and government. Reductions in state-funded salaries for Center employees will decrease research productivity and could delay responses to food animal veterinarians trying to prevent contamination of the food supply with antibiotic and other chemical residues.

Center for Family and Community Engagement (CFACE)

Officially incorporated as a center in 2008, CFACE is dedicated to community-university partnerships with and in support of families. Such engagement strengthens local leadership and develops the networks necessary for fostering healthy families and productive communities. The budget reduction will result in reduced opportunities for students and faculty for internships and research as well as loss of services to NC children and families who are victims of child abuse.

Center for High Performance Simulation (CHiPS)

Established in 2005, CHiPS brings together expertise from across NC State in electronic, atomic, meso-scale, and macroscopic simulation methods and offers advanced training and research to graduate students. The reduction in operating funds for the center will restrict the ability to bring in visiting scientists, facilitate interactions, and support students.

Center for R&D in Math and Science Education (CRMSE)

Formed in 1984, CRMSE has established partnerships with federal, state, local, and private agencies to work collaboratively to enhance mathematics and science education. Reassignment in administrative support and reduction of funding for an evaluation coordinator will shift administrative burden to professionals doing CRMSE work and reduce CRMSE’s ability to provide needed service to other Math and Science Education Network Centers throughout the state.

Center for Urban Affairs and Community Services (CUACS)

Established in 1966, CUACS provides applied research and technical assistance to state and local governments, public agencies, and non-profit organizations, improving the lives of North Carolinians. The reduction of personnel funds will increase the need to secure additional contracts and grants from state agencies such as NCDPI, where budget cuts will limit their potential for contract and grants work that CUACS depends on to sustain its operation.

ENCORE Center for Lifelong Enrichment

Since 1992, the ENCORE Center has provided opportunities for lifelong learning and enrichment for people over 50 through education, intellectual stimulation, and community involvement. The elimination of appropriated funds will require the ENCORE Center to be dissolved and converted to a for-fee program.

Friday Institute (FI)

The Friday Institute is engaged in leading-edge approaches to blend and coordinate work in the areas of educational research, practice, and policy. Established in 2005 to advance education through innovation in teaching, learning, and leadership, the FI works closely with NCDPI, the State Board of Education, the Office of the Governor, relevant legislative committees, and a wide range of partners including non-profit organizations (e.g., New Schools Project), private sector partners (e.g., IBM, Cisco, SAS), foundations (e.g., GoldenLeaf), and schools and districts throughout the State. Major programs and projects will continue, but the elimination of funding for research associate positions and substantial reduction of funds for contracting services will harm the Institute’s ability to seize initiatives and respond quickly to opportunities as they arise, diminishing its effectiveness in promoting best practices in education.

Furniture Manufacturing and Management Center (FMMC)

The goal of the FMMC (formed in 1992) is to assist furniture manufacturers in developing and maintaining the capability to respond quickly to market changes while producing products that are competitive worldwide in terms of price, styling, and quality. The required reduction will result in reduced extension to support the furniture industry.

General Hugh Shelton Leadership Center

The Center provides leadership development programs for students, scholarships, and an annual Leadership Forum. Established in 2007, the mission of the Center is to inspire, educate, and develop values-based leaders committed to personal integrity, professional ethics, and selfless service. Budget reductions will severely impact campus-based student leadership activities.

Institute for Emerging Issues

The IEI was established in 1980 as a “think-and-do” tank that convenes leaders from business, government, non-profit organizations, and higher education to tackle the biggest issues facing North Carolina. The reduction of personnel funds will reduce core programs and efforts within IEI, as no other funds are available to supplement the program.

Institute of Statistics (IS)

Over the 65 years since its establishment, the work of the IS has become fully integrated into the regular academic activities of faculty and staff in the Department of Statistics. Teaching, student mentoring and collaborative research in IS are little different from that in other departments. Indeed, other departments have “program”- (or “purpose”-) code 110 funds with similar histories yet not associated with formal centers or institutes. There is no longer a reason for the Institute of Statistics to be a separate organizational unit in the college. Thus, those organized research funds will be replaced with regular term instruction funds to better reflect their “purpose.” The funds required to do so result in a missed opportunity to add about 1,350 seats and 21 sections.

Integrated Manufacturing Systems Engineering Institute (IMSE)

Highly valued by NC industry since 1983, the IMSE has provided an environment in which faculty and students from different relevant disciplines can interact with each other and with industry in common areas of manufacturing systems engineering education and research. Reduction in graduate funding reduces the ability to leverage industry support and the ability to attract students and industrial sponsors.

Millenium Seminars

North Carolina State University’s Millennium Seminar Series was designed to engage, encourage and inspire NC State students throughout the academic year. Funding to support the Millennium Seminars Speakers Series will be eliminated; the $105,000 represents the amount of state appropriations used to pay operating expenses incurred for the Millennium Seminars Speaker Series in FY 2008-09.

Minerals Research Lab (MRL)

The MRL was established in 1954 to be a recognized world leader in research, development, and implementation of mineral processing and other separation techniques and to enhance technical and education services provided to faculty, students, industry, and the state. Personnel costs will be shifted to other revenue sources without loss of services.

Non-Wovens Institute (NWI)

Reductions to the Nonwovens Cooperative Research Center (NCRC), an integral part of the Nonwovens Institute, will directly impact research and education as all state funds are used to support graduate students. The NCRC was established as a State/Industry-University Cooperative Research Center (State/IUCRC) in 1991 as a result of a grant from the National Science Foundation and is a very successful industry member-supported center that highly leverages state support. The reduction in research support will have an impact on economic development, since this center has played a major role in attracting new companies or expansions of existing nonwoven textile companies in North Carolina. The center supports 74 leading nonwovens companies from throughout the world as well as 29 located in North Carolina.

The Ergonomics Center of North Carolina (TECNC)

The TECNC is a public service membership center specifically authorized by the NC General Assembly. It was established in 1984 through a partnership with the NC Department of Labor Division of Occupational Health and Safety to assist employees and employers in preventing occupational musculoskeletal disorders and optimizing human-machine work systems design from safety and performance perspectives. Personnel funding has been reduced with the effect that the TECNC will be less responsive to requests for services.

Water Resources Research Institute (WRRI)

WRRI is an inter-institutional research and education center of the North Carolina University System administered by NC State University. Established in 1965 by executive action of UNC President William C. Friday, WRRI is one of 54 state water institutes authorized by the Water Resources Research Act of 1964 to administer and promote federal/state partnerships in research and information transfer on water-related issues. Budget cuts will reduce research funds to the constituent institutions. WRRI will now be jointly administered with NC Sea Grant, resulting in the reduction of 0.5 FTE of a leadership position.

B – Business Affairs – Reduction of $1,267,992

Recent changes in our financial and student administrative systems and improvements in procedures and business processes will permit efficiencies that result in the elimination of five positions in the Financial Services division. The primary efficiency areas are: 1) requirement that students must pay their bills online or through the mail to the University’s lockbox; 2) eliminate outsourcing of electronic bills to students by using University software to generate the electronic bills; 3) increase the use of direct deposit for refunds to students; 4) increase use of the university’s online billing capabilities instead of manually billing customers; 5) continue increasing automation of the purchasing and payment systems; 6) increased use of electronic payments to vendors resulted in a reduction in banking fees and negotiated lower banking rates; and 7) eliminate the option for all students, except those with special circumstances, to receive paper bills.

The Chancellor’s Office and the Office of the Vice Chancellor for Finance and Business both have very few direct support positions but have eliminated the three positions. These staff reductions will impact support to the Board of Trustees, the organizing and scheduling of special events for the chancellor, and eliminating the receptionist position for the Office of Finance and Business. In addition, the Chancellor’s student intern position is eliminated, memberships in several national and regional associations have been cancelled, and a significant reduction in the volume of materials sent to the Board of Trustees will be required. Staff reductions will place a heavier burden on the remaining staff in the Chancellor’s and Vice Chancellor’s Offices as these reductions are not efficiency-related but the result of the requirement to reduce budgets.

The university is required to maintain appropriate controls on the receipt and expenditure of resources in accordance with State, Federal, UNC system, and prudent business management practices. At the same time as these controls are in place, the university makes every effort to avoid unnecessary bureaucracy in day to day procedures and processes. In addition, when events occur that expose the university to risk and potential litigation, structures must be in place to address such situations. The budget reductions in this area include the elimination of one internal auditor, one attorney, and a support position in the Department of Insurance and Risk Management. All three of these areas are minimally staffed for the work they do on a daily basis and these reductions will require shifting duties and responsibilities to other staff that already have heavy workloads. The result will be slower response times on critical audits, less preventive legal advice and delayed response to critical legal questions especially those related to research contractual issues and entrepreneurial endeavors, and in reviewing insurance coverage and processing claims. In addition, a significant reduction will be made to the ADA renovation projects budget that helps to maintain compliance with ADA (Adults with Disabilities Administration) rules and regulations. Only the highest priority projects from a sizable backlog of ADA projects will be funded placing additional physical restrictions and demands on a population that by law must be given access.

Reductions in business operations and processing that are not the result of efficiency in processes and systems require the reduction of one EPA professional and three SPA positions in Human Resources, the reduction from full to three-quarter time of an SPA senior budget analyst position, and elimination of the temporary wage budgets in the Controller’s Office systems accounting unit and the Budget office. SPA staff reductions in Human Resources are in the Employee Relations, Position Classification, and Recruitment Services units and will adversely impact response time to campus customers, employers, and candidates for employment. The EPA position loss is a senior leadership position responsible for many of the day-to-day operations of the HR Division. The staff losses will require increased workloads for other HR staff. Operating expense reductions are being made in all finance and business divisions, which will hinder the replacement of equipment, severely restrict travel for professional development, and impact the ability of these units to provide materials to faculty, staff, and administrators.

C – Academic Administration – Reduction of $1,658,036

Academic administrative units have taken steps to reorganize units, improve efficiency, and reduce staff and operating support. Collectively, the ten colleges and Provost’s Office will eliminate about 15 administrative and support positions and transfer responsibilities to remaining staff. Education has combined two departments, eliminating a department head and support staff, and the Graduate School will implement a more efficient method for processing transcripts, thereby saving staff time required both centrally and in the departments. Several colleges will reduce operating budgets that pay for educational supplies, photocopying course materials, and other support. These reductions will increase the workloads of remaining staff and administrative positions, reduce support to faculty and students, and delay processing of admissions, course registrations, licensure applications, classroom scheduling, budget and personnel actions, and other department-level functions.

In Undergraduate Academic Programs and University Planning and Analysis, three professional staff positions that support the assessment of student learning have been eliminated. The Graduate School will reduce the number of external reviewers when evaluating graduate programs. The College of Education will cut back the development and deployment of an information system used to monitor student progress, provide ongoing feedback to programs, and support compliance with state regulations and accreditation requirements. Impacts will include canceling NC State’s national assessment conference (which has become the third largest nationally), eliminating an assessment-consulting program for the community colleges, and reduced coordination of assessment across the university. NC State’s leadership in the assessment area will diminish, and its ability to meet accreditation requirements for assessment and program evaluation will be materially reduced.

E – Restructuring of Academic Programs – Reduction of $7,060,222

The colleges are pursuing a variety of strategies to streamline degree programs. In addition to five programs eliminated in early 2009 (MS in Agricultural and Resource Economics, BA in Health Occupations Education, and three bachelor’s degrees in special education). Agriculture and Life Sciences will delay implementation of the new genetics program, and Textiles will delay development of four graduate courses in medical textiles needed to support one of the University’s strategic focus areas. Engineering expects to curtail development of graduate programs, including courses for a new graduate program in energy to be delivered through the NSF-funded FREEDM Center. Education will cap its elementary education program, despite significant demand from applicants. Design plans to reconfigure its five undergraduate programs to require a common core of courses, with many courses to be reviewed and redesigned. Coordination of the University’s interdisciplinary genomics program will be disrupted, and development of new professional master’s degrees will slow. All of these strategies will reduce planned enrollment growth.

The University will invest fewer resources developing and promoting distance education programs. Development will be delayed in programs through the Upper Coastal Plains Learning Council, alternative teaching licensure programs, and collaborative engineering programs with UNC-Wilmington and community colleges. Enrollment in existing distance education courses offered outside of degree programs will be depressed. Substantially lower advertising budgets will likely affect enrollment, particularly at the Gateway Technology Center in Rocky Mount, since surveys have shown that more than half of our distance students learn about NC State programs through advertising.

Most significantly, NC State will lose funding and the opportunity to fill almost 40 vacant faculty positions. These losses will lead to gaps in faculty expertise in fundamental areas and reduce the quality and range of instructional programs, for example, in biological and agricultural engineering, animal science, and veterinary dermatology. In addition, they will halt the University’s progress in strengthening programs in areas central to its strategic plan and to UNC-Tomorrow goals: economic development, health and well-being, and energy and the environment. The University’s ability to develop instructional, research, clinical, and extension programs in critical emerging areas such as bio- and disaster preparedness, energy production and storage, climate change, comparative biomedicine, and infectious diseases will be limited.

Research programs will have more difficulty winning external support. For example, the College of Physical and Mathematical Sciences is discontinuing its partnership with the National Institute of Aerospace and several other major research universities. In addition, the loss of the equivalent of 12 faculty positions from Engineering will slow that college’s positive momentum in growing a research program that helps North Carolina attract and develop companies, create companies, and ultimately create jobs.

F – Research/Sponsored Programs – Reduction of $1,106,240

In addition to reductions in centers and institutes, reduced support for agricultural research, and reductions in research and sponsored programs as a result of lost faculty positions, budgets are being reduced for specific research programs. Personnel will be reduced in the Institute for Transportation Research and Education, making it more difficult to pursue external funding opportunities and reducing training for state transportation personnel. The administration of Sea Grant and the Water Resources Research Institute will be consolidated under a single director. Sea Grant will reduce the number of applied research projects in the Blue Crab and Shellfish Research Program, which supports the state’s fisheries industry, and research into blue crab farming will also be limited by a reduction in the Center for Marine Sciences and Technology (CMAST). CMAST will also reduce funding for a student summer fellows program and scale back the center located at Carteret Community College. The Institute for Nonprofit Research, Extension, and Engagement will reduce support for grant-writing and non-profit organizations. Reduced program funding for the Bioinformatics Research Center, will reduce student access to the Center’s resources. Finally, the Kenan Institute for Emerging Technology and Science will reduce operating expenses used for staff development and communications.

At the institutional level, Research Administration and the Graduate School will consolidate accounting functions and reduce operating expenses and publications. The reduction in the Centennial Campus Partnership Office will restrict the University’s effort to bring new partners to the campus, which may affect recruitment of companies to North Carolina.

G – Public Service – Reduction of $853,904

In addition to Cooperative Extension programs, scores of academic and administrative units across NC State provide technical assistance, training and education, clinical assistance, access to information, and other support to North Carolinians. Budget reductions will affect service to K-12 teachers, whose workshops and mentoring programs will be reduced; non-profit organizations, whose fees to use the McKimmon Center will no longer be waived; urban engagement programs in Wake and Durham Counties; affordable housing projects in Southeast Raleigh and for the Lumbee tribe; and continuing education for professional veterinarians. The Small Business Technology Development Center (SBTDC) has closed its Beaufort office, moved its Raleigh office off the Centennial Campus into more affordable space, and reduced support for programming on other UNC campuses. The Diagnostic Teaching Clinic will reduce personnel and will evaluate many fewer special needs children. The Libraries will reduce its contributions to NC Live, which provides remote access to its electronic collections to community colleges and public libraries across the state.

Reductions in outreach to K-12 students include the elimination of the Office of Pre-College Programs, which has coordinated programs to nurture middle and high school students’ interest in college and in NC State since 2007. Pre-college programs in Engineering and Veterinary Medicine are being reduced as well.

As a result of these reductions, NC State’s ability to provide knowledge-based assistance to citizens, neighborhoods, businesses, industries, and cities and towns and to contribute to higher college-going rates in North Carolina will be reduced.

H – Fund Raising and University Relations – Reduction of $841,363

Recent economic challenges resulting in diminished state appropriations to the University and significantly reduced external funding from contributions and earnings on endowments and other resources has forced the university to re-examine its fund-raising strategy. The Provost’s Office, Graduate School, and four colleges have reduced support for positions in their development operations, which places more responsibility on the central fund raising efforts of the Office of University Advancement. University Advancement eliminated a vacant SPA position and about $200,000 in operating support that will reduce their ability to support changes in relatively old IT fund-raising software, staff training and development, and other expenditures that might enhance the University’s ability to improve fund raising efforts. These cuts will make it extremely difficult to pursue best practices, particularly in major gift fund raising, and to retool staff and systems in advance of the next capital campaign.

The University has been assessing its overall communications environment and services at all level to determine the best and most efficient methods for informing our students, faculty, staff, alumni, donors, and friends about NC State. Electronic communications, the worldwide web, email, Facebook, My Space, iPods, Twitter, and so on, are all viable technologies that are being investigated to not only reduce communications costs but also improve communications to our internal and external community. As the new communication technology evolves, the Office of University Advancement will eliminate two television engineer positions. Administrative support via temporary wage or contracted services will also be reduced or eliminated in Alumni Affairs and University Communications. Print media for publications in the College of Physical and Mathematical Sciences and Provost’s Office will be shifted to online distribution. A significant reduction will also be made in support to the brand awareness campaign that will remove 11 million online advertising impressions, remove the search engine marketing campaign, measurement and monitoring that would place the University in the upper-most position within online search results, eliminate media training, and reduce the external contract that provides strategic guidance, creative support, and media relations.

I – Student Support – Reduction of $1,176,638

Consistent with UNC Tomorrow’s goals, one of NC State’s strategies is to “prepare leaders for the state, nation, and world.” Student leadership programs impacted by the budget reductions include the Center for Student Leadership, Ethics, and Public Service, a particularly successful program which supports students’ service to the community that is eliminating student transportation to service projects. The Graduate School is reducing the number of workshops designed to help graduate students supplement their discipline-specific skills with skills in teaching, research, and leadership. The University Scholars Program, which engages participating students in the arts and contemporary issues, will offer fewer programs to fewer students. Greek Life is reducing student workers by 50%, reducing advising and programming for over 2,200 students.

NC State has traditionally relied on co-curricular programs to develop students’ understanding and appreciation for the fine and applied arts. The Gregg Museum of Art and Design is reducing the number of exhibitions and cutting back on long-term conservation of artwork. ARTS NC STATE will decrease funds used to maintain music instruments and facilities.

To create a welcoming campus climate and demonstrate the University’s appreciation for the diverse backgrounds of its students, faculty, and staff, the University has established a variety of diversity programs for students. The African American Cultural Center (AACC), which houses exhibition space, library, and meeting facilities, promotes awareness and appreciation for the African American experience with speakers such as Morris Dees and with exhibits such as the retrospective of photographs by Gordon Parks. The AACC will eliminate all art exhibits in its gallery and reduce guest lectures. Celebratory events such as the campus-community Brotherhood Dinner and diversity awards banquets will be reduced or eliminated. Multicultural Student Affairs will eliminate graduate assistantships, and the Women’s Center will sponsor fewer events.

Reduced staff hours in a dozen or more student support offices across the University will increase the workload of remaining staff and reduce their effectiveness in responding to students’ questions and needs. A reduction in communications in the Career Center will affect students’ ability to connect with prospective employers. A reduction in Counseling Center hours will reduce student access to psychiatric services. Support programs for parents and families and for first generation students will be shifted to fees and federal contracts. The Office of Student Conduct will reduce summer staffing, reducing its capacity for judicial assessment and crisis response. Reductions in Disability Services will substantially limit the number of “reasonable accommodations” that can be offered to students needing interpreters, readers, scribes, Braille translators, and other services, impacting the University’s ability to comply with federal laws.

The cumulative effect of these reductions will be to diminish opportunities for NC State students to broaden their perspectives, apply their classroom knowledge in real-life “laboratories,” and access services that support their academic and personal development.

Enrollment Management and Services, which interacts with students from application to graduation, has identified a number of cost-saving strategies. Some recruiting and processing positions in Undergraduate Admissions will be eliminated, restricting capacity to provide a high level of customer service to families and possibly delaying the processing of applications. Undergraduate Admissions has improved efficiency by reducing mailing costs, and prospective students and families visiting campus will no longer receive free parking. Despite expanding federal regulations, a 20-25% increase in applications this year, and delays in external funding, the Financial Aid office will lose a position and operating support, leading to delays in financial aid awards and slower response to students and family concerns. The Registrar will reduce mailings, rely solely on email to communicate with students in academic difficulty, and increase transcript costs to alumni. Funds for commencement expenses will be reduced, providing a less satisfactory recognition of graduates’ achievements for their families. In addition, the Graduate School will eliminate less effective visits to recruiting fairs.

J – Information Technology – Reduction of $3,215,144

The Office of Information Technology (OIT) configures, deploys, manages, secures and monitors the data servers, data storage and backup systems that underlie all of NC State’s centrally supported administrative and academic computing services and data resources. Reductions of two positions in this area will mean that responses to server issues will be slower as the workload will be absorbed by other staff. Software and hardware maintenance support levels will be reduced, which may cause longer interruptions for campus before services can be restored when there are failures. One position working in the computer networking and telecommunication areas will also be eliminated which will reduce wireless network access services available to students and delay the implementation of nomad authentication upgrades. The delay in nomad authentication upgrades will push the hardware past its recommended lifecycle and increase the risk of failure of some parts of the system thereby reducing access.

Reductions of nine central IT staff working in enterprise applications creates a significant limit on the ability of the remaining staff to modify, update, and provide support for the administrative IT services that support HR, Finance, Student, and Advancement applications. All project teams will experience noticeable slowdowns in delivery dates as the remaining staff attempt to pick up the workload of eliminated positions. Software and hardware maintenance support levels will be reduced, so when equipment fails, campus users will experience longer interruptions before services can be restored. The University’s recently initiated collaboration effort with UNC-CH on the Human Resources and Financial applications will continue to be encouraged.

OIT monitors the IT network and computer security for the entire campus including scanning for network intrusion, complying with policies/mandates/laws, and handling incident response activities, resiliency plans, and software licensing management. The elimination of four positions will decrease efforts to develop and maintain a disaster/resiliency plan, extend time for responding to audits, and delay efforts to organize root cause analysis for IT problems, which will affect students, faculty and staff. Managerial and project management resources will decrease significantly and may impact monitoring of attacks/vulnerabilities, research for compliance with regulations/mandates, and the development of necessary rules, regulations, guidelines, and responses to audit findings and recommendations. Workloads of remaining staff will increase to take on additional duties from the eliminated positions.

K – Operation and maintenance of physical plant – Reduction of $5,793,435

Staffing and budgets designated for the renovation and improvement of classroom, distance education, and various other projects will be severely reduced. This will include the elimination of fourteen positions and reduction of $1.1 million in the operating budgeted reserved for facility renovations, improvements, and occupancy of new facilities. The backlog of required renovations will continue to growth with only the very highest priority projects being completed, which will eventually affect all campus departments and colleges. Facilities Division has eliminated four administrative and three capital project manager positions in its administrative departments. Remaining technical and administrative staff members will have an increased workload. As capital construction and major renovation funding ramps back up, re-creation of these positions will be required; if there is less staff to carry out the same capital program, the program will slow down thereby decreasing the buying power due to inflationary erosion of the capital budget.

With the elimination of fourteen housekeeping positions, housekeeping area assignments will increase substantially and service levels will be reduced impacting academic and research spaces. Dollars spent per gross square foot (GSF) will be approximately 16% below the average of peers based on the national benchmark data used as a result of the PACE initiative. Dollars spent per GSF are currently 15% below the UNC system average. In addition, five grounds maintenance positions will be eliminated which will impact turf care levels, fertilization/herbicide treatment cycles, litter control and annual bed plantings resulting in a decline of general campus appearance and therefore the ability to recruit students. Event support levels will be reduced to minimums. Dollars spent per acre will be approximately 45% below the average of peers based on the national benchmark data used as a result of the PACE initiative. Dollars spent per acre are currently 12% below the UNC system average. One position will be eliminated from the Sustainability program, which will hinder efforts through having lower visibility and utilization by the campus community. Earth Week activities will be suspended and our energy awareness campaign will slowed resulting in a loss of momentum in raising campus awareness to decrease consumption and help prevent a larger carbon footprint for the campus.

The Utility maintenance unit will be reduced by three staff. Maintenance support and response times will increase, including extended times for on-call after hours response. Preventive maintenance cycles will be increased, resulting in shorter expected life for equipment and increased potential for failures and unscheduled outages. Deferred maintenance and capital renewal backlog levels will accelerate. The maintenance cycles on thermal distribution systems such as steam and chilled water will increase and plant maintenance activities will be deferred. Elimination of the weekend rounds program will result in increased outages on Monday mornings at the start of the academic week. Reduction in preventive maintenance and deferred capital renovations will result in higher long-term capital costs. Dollars spent per GSF will be approximately 12% below the average of peers based on the national benchmark data used as a result of the PACE initiative. Dollars spent per GSF are currently 17% below the UNC system average.

An increased emphasis on energy management and energy conservation, combined with anticipated reduced costs for energy, enables the university to reduce its utility budget by $1.2 million. Comfort levels in offices and classrooms may be adversely impacted. There are few other methods available to generate significant utilities savings in the short term.

The University’s $4 billion of facilities and infrastructure require a significant annual investment of resource to preserve this investment and extend the life of the current physical plant. The budget for emergency repairs to these facilities and infrastructure will be reduced by $1.1 million, which will further compound the backlog of necessary repairs and leave remaining only sufficient resources for the most critical repairs that prohibit use of a facility or portion of the campus. The combination of the spending freeze in 2008-09, the absence of any repairs and renovation in 2008-09 and 2009-10, and the continued aging of our plant, will make it extremely difficult for the campus to reach with the meeting what might be considered a minimal 2% annual investment in facility repairs and preventive maintenance. The remaining emergency repair budget may well prove inadequate.

L – Academic Support – Reduction of $2,646,500

Overall, the University has eliminated 7 academic advising positions and 15 tutors. The majority were located in the Division of Undergraduate Academic Programs (DUAP), which is combining four advising programs into a single, more comprehensive, and more efficient advising group that will provide multiple services to NC State undergraduates. The College of Management will not fill a vacant advising position, bringing the advising load to 450 students per advisor. The College of Agriculture and Life Sciences is eliminating HealthPAC, a three-person team that has advised 5,000 students interested in entering health professions.

In addition, DUAP is eliminating the Fellowship Advising Office, which has helped students compete for fellowships and graduate school since 2005. In addition, three positions in International Affairs with half-time advising responsibilities will not be filled, leading to reductions in study abroad participation and support for international students, and negatively affecting the University’s efforts to produce students with more global knowledge, cultural understanding, language skills, and international experience. Reductions to academic advising and tutorial assistance are low on the reduction priority list and would be considered important for any reinvestment opportunities.

In the area of class-related support, a significant portion of the University’s savings will come from DELTA (Distance Education and Learning Technology Applications), which has identified ways to reduce costs with minimal impact on students support services. Some staff are voluntarily reducing hours, the unit will no longer pay fees for certain services, and student interns will provide “free” instructional support instead of temporary employees. In addition, DELTA will produce its own DVDs and videotapes for distance education students at a lower cost than outsourcing this task.

In other areas, funds for educational field trips, supplies for teaching labs, and teaching lab technicians will be curtailed, which in turn will reduce the number of lab sections in some colleges. At the College of Veterinary Medicine, reductions will be taken in the unit that manages freight deliveries to the hospital and in the Lab Animal Resources unit, which sets standards and cares for the use of animals in research and teaching. The Biomanufacturing Training and Education Center will drop plans to develop a solid dosage training laboratory that would have supported collaborative pharmaceutical programming with Campbell University and short courses in RTP; companies may choose to locate new facilities elsewhere due to the lack of local training facilities in solid dosage.

Consistent with its strategic plan, NC State has invested heavily in programs to enrich the undergraduate experience at NC State. A number of enrichment programs have been established or expanded in recent years, including the Center for Excellence in Curricular Engagement, Executive-in-Residence, the Entrepreneurship Program, Study Abroad, Global Centers, the Undergraduate Research Program, and the Honors Program. While successful, these new programs serve a relatively small proportion of students and will be scaled back. In conjunction with reductions in academic support programs, the reductions will impact NC State’s success in attracting and retaining outstanding undergraduate students.

P – Professional Development – Reduction of $602,168

One of NC State’s strategic priorities is developing outstanding faculty and staff. However, a variety of in-house professional development opportunities are cutting back on programming. Examples include support for participation in BRIDGES, which provides leadership development for women, and the Office of Faculty Development, which is a resource for faculty seeking to develop their expertise in a variety of areas of responsibility.

Training and ongoing support for the use of instructional technology, such as the Instructional Support Services in DELTA, will be reduced, slowing the ability of faculty and graduate teaching assistants’ to re-orient traditional, face-to-face classes to classes taught online and/or with the use of instructional technologies. DELTA will discontinue a program preparing graduate teaching assistants to help faculty develop online courses and materials, and incorporate this training into existing faculty instructional development programs. DELTA will also implement a more efficient method of staffing distance education classrooms.

Many colleges and administrative units are reducing their professional development funds, which are one of their few sources of flexible funding. Human Resources will defer implementation of a new “one-stop shop” providing new employee orientation and convenient opportunities for vehicle registration, campus ID cards, and access to IT systems and email user set ups.

NC State’s strategic plan also argues that diversity of perspective is necessary for a quality faculty and staff. A variety of diversity programs at the department, college, and university level provide a supportive environment, and networking, social, and learning opportunities that promote understanding and team skills. To accommodate this year’s budget reductions, the University will withdraw from the national Association for Black Culture Centers, which it has sponsored for several years. The successful Study Circles program in the Office of Equal Opportunity will be eliminated. Funding has been reduced for the PURPOSE institute, which provides national networking opportunities for women engineers of color, and from the Council on the Status of Women, which sponsors campus activities. Staff support for compliance reporting has also been reduced to the minimum necessary to complete reporting requirements.

Q – Libraries – Reduction of $1,896,363

As members of the Triangle Research Libraries Network, NC State, UNC-Chapel Hill, Duke, and NCCU enjoy an extraordinarily efficient partnership that has provided students and faculty access to a large collection with minimal duplication for decades. However, this arrangement will not ameliorate the NC State library’s substantial reduction in collections expenditures by $1.5 million. This reduction will require cancellation of 1,000 journal subscription (a 20% decline), loss of online access to an additional 750 journals, cancellation of 17 electronic databases, and the purchase of 15,000 fewer books than last year (a 50% decline). Branch operating hours, service in the Digital Media Lab, and the federal documents depository collection will be significantly reduced. The library will close the Media/Microform service point and henceforth provide access to materials in open stacks, research, or a satellite location. These reductions will affect the students’ access to educational materials, the faculty’s competitiveness in obtaining research grants, and the North Carolina public’s access to scientific and technical information.

R – Seats and Sections – Reduction – $5,224,667

The University has attempted to protect instruction as much as possible, deliberately lowering the reductions assigned to colleges generally and to general education specifically. Budget reductions from all categories (in particular the loss of filled and vacant faculty positions) will reduce NC State course offerings by approximately 300 class sections and 9,750 fewer seats than last year. While these reductions represent a small fraction (3%) of the overall teaching effort, reductions in humanities, social sciences, life sciences, physical sciences, mathematical sciences, and physical education will be necessary, and the loss of seats and sections in these areas will likely lengthen students’ time to degree. All colleges are implementing efficiency strategies, such as increasing class size where large classrooms are available and shifting classes from regular term to summer session. The First Year Inquiry program, which was created in the 1990s to incorporate critical thinking skills and inquiry-guided methods of instruction into general education courses, will be scaled back by about 40 course sections. The College of Management will combine cohorts of RTP and Raleigh students and expand use of a 400-seat auditorium previously restricted to lower division classes. A few colleges are capping or reducing enrollment now — Textiles is capping its new, very popular fashion program, and Education has stated it cannot staff the courses required for two master’s programs leading to licensure. All colleges are reconsidering their long-term enrollment goals, and the impact of eroding course availability will be felt for several years into the future. Reducing seats and sections is NC State’s lowest budget reduction priority, and if funds are retained they will be reinvested to support instruction in general education and undergraduate majors.

S – Campus Safety – Reduction of $630,855

The University has made every effort to minimize reductions that will adversely affect the health and safety of the faculty, students, staff, and visitors to the campus. Therefore, this reduction has been strategically implemented in such a manner that minimizes any adverse affects associated with the health and safety of the campus community. The Assistant Director of Campus Police position has been abolished, which will substantially limit strategic planning and coordination with other criminal justice agencies within the UNC system and Wake County. The Commander of Support Services and the Patrol Division Commander have assumed many of the Assistant Director’s responsibilities; however, limited resources will curtail time dedicated to strategic planning and coordination with other agencies. The Evidence Custodian position in Campus Police has been abolished with evidence management being reassigned to sworn law enforcement officers, thus reducing their time available for patrol. Campus Police will eliminate out-sourced security services, which often includes security guards locking many of the buildings on North Campus; departments will have to lock their own buildings.

The development of new training and course offerings will be cut back as the Safety Trainer position has been abolished. The training responsibilities will be delegated to other Environmental Health & Public Safety staff members. The Industrial Hygiene Manager position has been abolished which will reduce the number of monthly lab inspections and chemical safety overviews conducted. Ultimately, Principal Investigators will be encumbered with these responsibilities. Other critical responsibilities of this position have been shifted to existing Industrial Hygiene staff. Environmental Health and Safety will eliminate the centralized lab signage replacement program. The Threat Assessment program manager will share administrative resources with Campus Police, which will increase time for production of training resources and delay deployment of threat assessment management tracking system.

Funds for Lot 86 (Superfund site) have been reduced since the site is now considered in the Operation and Maintenance Phase transitioning from the Remediation Phase, which involved extensive site clean-up expenses and the design of a groundwater treatment system. Operation and Maintenance costs are primarily limited to monthly maintenance, annual sampling, and annual EPA oversight costs. Managing low-level radioactive waste shipping has become more cost-efficient so despite campus increases in the volume of shipments, the disposal budget is being reduced.

Also eliminated will be the professional manager position for the Campus Background Check Program that processes more than 5,000 background checks per year. The manager position’s responsibilities will be assigned to the current Assistant Director of Employment Services and the one remaining staff processing position. This will mean extended wait times for campus units to receive clearance verifications on hiring actions. Finally, the budget for safety related renovation projects will be reduced by 24% adding considerably to the project backlog and meaning that only the most critical projects will be completed.

X1 Continuation Budget Increases – $4,819,823

NC State University’s 2009-10 Continuation Budget request included cost increases for Personnel Benefits, operating costs for new facilities, utilities, library collections and acquisitions, and motor vehicle/motorized equipment replacement. These are essential cost increases necessary to maintain current levels of operation and, failing receipt of additional state appropriations will require reallocation of available budget resources to cover the most critical of these costs. Funding for these increases was not included in the 2009-11 Appropriation Bill. Following an evaluation by the University, it was determined that certain of these continuation budget cost increases are essential and will have to be covered through a reallocation of university resources.

X2 Realignment of funding resources – $1,914,692

University management will adjust the administrative service charge assessed to institutional trust funds to compensate for the general and administrative services funded from state appropriated funds. This additional funding will replace state appropriated funds reduced from the 2009-10 Continuing Base Budget and ameliorate a portion of the budget reduction for all colleges and divisions. The increase in the Administrative Service Charge is expected to be absorbed by units without increasing charges to campus customers or students.

Other funding realignments will impact rental and program charges to external organizations holding events at the McKimmon Center and charges to external customers using the services of the Center for Urban Affairs and Community Services. Some funding sources for the State Climate Office will be shifted to non-state appropriated funds and direct payment will be required by campus units using the armored car pick-up/delivery service.

We have reduced our budget by 10 percent – which is the figure General Administration set for all UNC universities. The 10 percent reduction meets the legislature-mandated decrease in budget and provides an additional three to four percent that we would hold out for a mid-year reversion should there be additional shortfalls in the state’s revenue receipts. These reductions result in the elimination of nearly 300 class sections and 9,750 seats as well as 440 FTE faculty and staff positions, of which 176 are currently filled.

Without question, the impact of these reductions is significant. We allocated smaller reductions to academic units, yet we are still losing enough teaching positions that our instructional capacity will drop by about 3 percent. Low- enrollment programs are being eliminated, and new programs are being put on hold. We have protected General Education to a very large degree, but students’ opportunities to participate in academic enrichment and co-curricular programs — such as study abroad, leadership programs, service learning, and research — will diminish, thereby lessening their collegiate experience.

I am also concerned about the erosion in core faculty expertise. Many departments are giving up faculty positions, vacated by retirements or departures, that once contributed specialized knowledge to undergraduate and graduate students, an interdisciplinary research program, and/or a team of faculty and students engaged in an economic development project. As faculty reduce their research and extension activities to cover the classroom, we will be less able to leverage the state’s investment to increase the external support for research that ultimately enhances social and economic well-being for all of North Carolina.

In preparing these budget reductions, we were careful to respect our University Budget Principles and strategic plan, and the voices of our students, faculty, and staff. Our primary strategies were to avoid formulaic, across-the board cuts and to look first for efficiencies and last for reductions in service.

Our priorities were to protect undergraduate general education and to minimize the impact on our core mission. For example, although the mandated reduction was 10 percent, the reductions allocated to our colleges ranged from 3.36 percent to 8.55 percent. Beyond that, we gave priority to programs aligned with NC State’s strategic plan.

NC State provides many relevant academic, research, and service programs. I am certain that an investment in this institution is an investment in North Carolina’s youth and in the knowledge foundation necessary for the state’s continued development.

We can and should be grateful to the legislature and the governor for ensuring that education was among the areas least affected by budget cuts. But the final cuts are very real and very painful.

I encourage you to review the summary of reductions submitted to General Administration. It may be helpful for you to see the impacts to our mission and to our academic and administrative units.

We have worked together as a campus community to respond to extraordinarily difficult budgetary times. I thank you for your ideas, suggestions and patience and ask that you continue to work with enthusiasm, professionalism and optimism as we carry on the work of NC State University.

The proposed budget contains a 10 percent reduction in state funding to cover an expected 6 to 7 percent cut and also allow for budget reversions if lower tax revenues force the state to take back funding during the fiscal year. Under the proposed budget, NC State would lose 440 faculty and staff positions and 300 class sections.

We know that these decisions have a very real impact on our employees and their families and our students and their families. We are saddened at the loss of our colleagues and mindful that students could face delays in their progress toward graduation. Throughout the budget planning process, we have worked hard to make responsible and sensible reductions while safeguarding classroom activities as much as possible.

As you know, the state legislature continues to debate the right combination of measures needed to meet a drastic shortfall in the state’s projected revenue for 2009-2010.  It is apparent that every effort is being made to minimize the negative impact on education at all levels.  Of course, we will know more about the specifics of our own budget once the state budget is final.

Meanwhile, you can return regularly to the Budget News site for updates and announcements and to comment or ask questions.

Chancellor Jim Woodward

• Read the Governor’s Office Press Release

• View Executive Order 20 (pdf)

- Chancellor Jim Woodward

Message from NC State Deans Regarding Budget Impacts

NC State is planning for budget cuts in response to the state’s financial challenges. Although NC State is doing everything that it can to avoid affecting students’ progress towards their degrees, the university cannot absorb cuts without affecting classes and courses. We want to help students, their families, and the public to understand the extraordinary efforts we are taking to protect classes and courses, and, despite those efforts, the subsequent impacts of budget cuts.

The faculty, staff, and administration of the university are committed to providing excellent and affordable higher education. Included among the steps we are taking to protect students’ access to higher education are:

• Teaching more courses; some are volunteering to teach more classes, and some are replacing efforts in research, extension, and administration with instructional activities.
• Increasing available spaces in existing classes by moving some classes to larger rooms, and adding additional spaces to traditional courses via distance education technology.
• Replacing traditional courses with courses offered via distance education or in summer sessions.
• Replacing elective courses and seminars with additional sections of courses required by degree programs.
• Reducing non-teaching staff before teaching faculty and reducing or eliminating non-instructional expenditures.

Although our extraordinary efforts have rescued or created thousands of additional spaces for students, budget reductions will still have significant, negative consequences. Included among those consequences are:

• A net loss of hundreds of classes and thousands of available spaces for students; that is, the number of classes and available spaces lost to cuts will be much larger than the number rescued or restored.
• Reduced course availability, which will slow students’ progress towards their degrees, increase the number of semesters needed to graduate, and delay students’ entry into their careers.
• Larger classes, resulting in higher student/faculty ratios.
• Less student support for academic advising, scholarships and honors, study abroad, labs, field trips, library, security, recruitment, diversity, and other support services and enhancements.
• Increased costs to students in the form of distance education and summer school fees.
• Fewer opportunities for student research, and reductions or elimination of courses and seminars addressing advanced, emergent, or current topics.
• Reduced funding for graduate students, which will reduce our research productivity.
• Reduced faculty productivity in research, extension, and engagement activities, which ultimately lowers the national rankings of our academic programs.

We do not want to alarm students, their families, or the public—but we feel it is imperative that all stakeholders understand the extraordinary steps NC State is taking to mitigate budget cuts, and the consequences of budget cuts on the university.

When I stepped through the doors of Holladay Hall on Tuesday, I understood the responsibility I was accepting.  As has been said many times, I would not have taken a similar position anywhere else.  NC State is a special place with a mission especially important to the future well-being of North Carolina.  My commitment to you is to do my absolute best to provide the leadership and effective management that NC State deserves.

There is a lot that I must learn in the coming days.  I am examining NC State’s current budget, what has been done to date internally regarding the reversions and cuts, and the anticipated impact of what the proposed cuts might bring.  The budget cuts being talked about exceed anything I had to deal with during the time I was chancellor at UNC Charlotte.  But the approach one uses to deal with budget cuts of any size is the same.  There are three points that I have learned are important in managing and executing a budget: establishing a set of budget principles, ensuring a process that reflects those principles; and providing clear information about who makes specific budgetary decisions.  Of course, woven throughout each of these points is the need for transparency on all levels.  I will be interested in learning about NC State’s budget principles and how those principles have led to the processes in place and the decisions likely to be made.

I also will be meeting with members of the General Assembly to deliver a message in tune with President Bowles’ to minimize cuts and their impact on delivering a high quality education.  Re-establishing lost trust with the political leadership is also an important task for me. Fortunately I’ve been in the state, I’ve been a chancellor, I know many of the political leaders, and I would hope they would see me as someone they can trust. And I am going to commit to them that they can trust me and trust the excellent people that do the work of this university.

What makes a university great are its people.  I believe in sharing with you, the faculty, staff and students, information on what decisions are being made and why.  I also believe in opening the channels of communication with you so that I have a better understanding of the diverse needs of this university.  It is worth noting that historically this campus has been well managed. Until these issues came along, this was not a troubled campus. So I believe that we can rapidly re-establish the internal confidence, internal trust that’s needed within any good university; and this is a very good university.  As chancellor, my top priority is to ensure that we deal with the budget crisis in a way that will best protect our ability to continue our mission, especially our history of offering high a quality education.

It is clear that the state’s budget situation has not improved. Last week, I called a meeting with our executive officers, deans, vice provosts, department heads, the University Budget Advisory Committee and university budget officers. Interim Provost and Executive Vice Chancellor Warwick Arden, Vice Chancellor for Finance and Business Charles Leffler and I addressed the group to provide the latest information on the expected reduction for 2009-10 and an update of the current version of the House budget. We had a candid discussion about what to anticipate for next year and asked that the information be shared broadly within each unit.

As the House continues to make the finishing touches on its proposed budget, I am asking our campus to move forward with aggressive action to be prepared for more extensive cuts. Even though the state budget is not final, we have some idea of what to expect based on what the House has proposed:

• A potential $336.6 million reduction in state funding for public universities or at least 11.1 percent over our 2009-10 base. The state’s largest universities are expected to get a larger allocation of this cut.
• An increase of $200 a year for tuition for all UNC universities. That equates to an 8 percent increase for NC State students. The tuition increase dollars would not come back to the campuses but go to the state. This increase displaces the campus initiated tuition increase (CITI) already approved by the BOG.
• A reduction in state-appropriated funding for select centers and institutes of 20 -100 percent (by 20 percent in most cases). We had already been in the process of evaluating the status of our centers and institutes. As a result, we are dis-establishing or combining at least 12 of the 68 current centers and institutes and discontinuing further efforts for three of the six that were currently authorized to plan. We also have imposed a moratorium on the submission of new centers and institutes, effective immediately.

The full House is expected to vote on the final budget next week. Following the House approval, the House and Senate will then appoint conferees to determine the final budget, expected to be approved by mid- to late-July.

Historically, we have taken reductions using one time and year-to-year cuts, but we can no longer think that way. We must be more strategic, thinking three to five years out, or longer. To ensure that we are prepared for the next fiscal year, I have asked campus leaders to create a plan by June 15 to identify reductions using an 18 percent target.

There is no question that such a reduction is cause for concern. If we reduce our resources, we also must reduce the work funded by those resources. We can no longer expect the people who are left to do the work of a larger workforce. We cannot teach a growing student body with fewer faculty, and we cannot provide as many services with a smaller staff.

President Bowles and I have met with and called legislators to express our concern about the effects of such cuts on higher education in North Carolina. I have been in touch with our Board members, alumni and others, asking for their help in voicing our concern to their legislators. Cuts of this scale will have tremendous effects on every student. It will have an impact on the university’s mission. Our students will see larger classes, less advising and counseling, higher faculty/student ratios, lower retention and graduation rates, delayed classroom upgrades and laboratory renovations, among other things.

I am hopeful that the reduction will be less than the 18 percent we are planning for, but by planning for a higher number, I believe we are doing what we can to put ourselves in a position of strength—a position that prepares us for a quick recovery when better budgetary times return.

The faculty and staff senates will be co-sponsoring a town hall meeting on Monday, June 8, at 2 p.m. in Stewart Theater to provide the opportunity for a larger audience to hear an update on the budget situation. I also encourage you to continue to help us take the best available course by submitting your questions and suggestions to the Budget News site, where you can also find new information in the questions and answers section.

Here’s what we know:

1. All university employees (regardless of source of funding) will receive a .5 percent reduction in their annual salary.  For example, an employee who makes $50,000 will see a salary reduction of $250.
2. The reductions will take place in May and June.
3. Employees will be given 10 hours of “flexible” time off, which can be used from June 1 through Dec. 31 (pro-rated for part-time employees) and subject to your supervisor’s approval.
4. Benefits will not be affected by the furlough.  The reduction will not impact longevity pay, payouts for unused leave, service credit or health and retirement benefits.

Additional information will be available as soon as possible.  Check the NC State home page and the budget news page for updates and information.

For the fiscal year that begins July 1, we continue to work through the academic and administrative plans for five percent budget cuts at NC State.  These unit plans were sent to our Budget Office in March.  Our next step is to find another two percent in cross-functional contingency reductions, moving toward a total seven percent budget reduction strategy.  We expect to have full details of our 5 percent budget reduction plan within the next two to three weeks.

We are holding to our established budget principle of protecting classroom activity.  Producing well-prepared graduates is our reason for existence.  So, while we have held classroom and laboratory capacity cuts to about 1 percent, non-academic units have taken as much as seven percent reductions.

Based on our 5 percent reduction plan for fiscal year 2010, we expect to eliminate up to 300 jobs, of which half are unfilled positions.  Of the 36 employees who thus far have been included in Reduction in Force actions, we are providing human resources support in their job search and have placed three of those employees in other state jobs.

While we have created a plan for taking budget reductions, I would like to reiterate that our budget principles influence how NC State manages the budget dollars available to us – not just how we apply reductions to our budget.  Our budget principles parallel the agenda established by UNC President Erskine Bowles’ PACE initiative, through which the UNC system trimmed about $32 million from the non-academic side of operations.

Over the last several years, because of budget realities, we have taken the approach of using available state dollars to build a cadre of career path, non-tenure track teaching faculty.  The number of tenured and tenure track faculty has remained relatively steady over this period of time.  Compared to data from our peer institutions, we appear to fall in the middle ranks in terms of the percentage of faculty who are tenured/tenure track.  We also have added academic advisers.  These additions have helped us meet NC State’s increasing enrollment by maintaining reasonable student-to-faculty ratios in teaching.  These steps have allowed tenured and tenure track faculty to best focus their time on teaching, research and outreach activities.  Our budget plan also has helped us meet increasing student demand for learning experiences outside the classroom – service learning and international experiences, for example.

Students continue to graduate in record numbers ready to hit the ground running as productive members of society and successful professionals.  We have taken the approach of reducing the budget in such a way that we position the university to rebound quickly when better budgetary times return.

We are committed to focusing on our core mission.  We continue to welcome your input and I encourage you to provide your suggestions and ideas on our Budget News web site http://www.ncsu.edu/budget/.