Budget update, April 1, 2016
April 1, 2016
With the month of March having just ended, we’ve heard from many people wondering
about the status of the university budget and the first round of layoff notices we
referenced several months ago.
While leaders throughout the university have been working to craft a plan to manage
our shrinking budget, that process has been slower than expected. At this point, this
is what we can share:
Even before the legislative session began, we knew this would be a difficult budget
year. We initially planned for a $26 million budget gap in FY17, which includes both
funding reductions and cost increases due to salary and benefit increases, utilities
and other expenses. Because legislative action has made it clear that we may face
even steeper cuts in our state funding, we have also been planning for the possibility
of a $36 million budget gap.
It is virtually certain that the budget gap will be at least $26 million, so many
units have begun implementing their budget reduction plans. Unfortunately, some of
those plans include losing valuable people. Some UAF employees have received layoff
notices and notices of non-renewal or contract reduction. We also know that nearly
all units will be leaving most vacant positions unfilled next year, in an effort to
balance budgets. For UAF as a whole, even our best-case scenario of a $26 million
reduction will likely mean at least 300 people and positions affected.
While some units have begun implementing their plans, others are awaiting more information.
Meanwhile, the UAF administration is weighing options proposed by each of the vice
chancellors carefully. Recommendations from the Planning and Budget Committee on those
options are expected to be presented to the cabinet in the coming weeks. The Board
of Regents is expected to weigh in on the budget reductions next week and the Legislature
is scheduled to adjourn mid-month. Both will give us more certainty on our next steps.
Budgeting with a constantly changing revenue target is proving a challenging task,
and one that happens more gradually than all at once. As units have more clarity in
the coming weeks and months, they will implement their plans. Regardless of the timing,
all affected employees will be given due notice and provided assistance.
I ask for your patience and understanding in the coming weeks and months. I know you
are all feeling the heavy load and uncertainty. I will continue to share updates as
they become available. I would also encourage all of you to read your Cornerstone
newsletters, as we will often use that mechanism to share information as we receive
it, along with legislative updates.