Budget reduction scenarios and leadership update
Apr. 10, 2020
To Our University Community:
During the past week, University administration has worked in concert with the Nevada System of Higher Education in formulating a proposal for budget reduction scenarios requested by Gov. Steve Sisolak. The Governor’s request has come in the wake of unprecedented fiscal challenges all of Nevada has faced due to the outbreak of the novel coronavirus (COVID-19).
This message is an update on University budget reduction scenarios and a leadership change approved today during the Board of Regents’ special meeting. The University’s budget proposal will now go directly to Gov. Sisolak, who will make budget reduction decisions in the near future.
Due to the COVID-19 crisis, the University of Nevada, Reno’s presidential search process was postponed, to conclude in September 2020. Today Chancellor Thom Reilly and the Board of Regents approved an agreement whereby I will remain as president until Dec. 31, 2020, or until my successor is named. As we move from the spring to fall semester, we will be transitioning classroom instruction, operations and services back onto our campus with guidance from Governor Sisolak, NSHE Board of Regents, the Centers for Disease Control (CDC) and the Washoe County Health District. We will be facing the prospect of our first major budget reduction in several years. The agreement reached today will afford the University leadership continuity and stability until the new president is in office.
Budget reduction scenarios
The University’s approach to budgetary reductions is comprehensive across the University for Fiscal Years 2020 and 2021. During the severe budget shortfalls of the 2008-2013 recession era, selective program closures were implemented to protect the most central and strongest programs of education, student support, research, and community engagement. Since that time the University has focused on deepening the preserved programs and investing strategically in new programs, rather than restoring the programs which were closed. As a result, there are no programs to sacrifice (no curricular program reviews) with the current COVID-19 budget reduction scenarios. This is why the University is proposing to remove resources comprehensively across the University in hopes of preserving as much as possible the recent momentum we have achieved in all programs, which has resulted in national recognitions in teaching quality, research and community engagement.
The FY’20 proposed 4% budgetary reduction focuses on salary savings and operating fund savings resulting from the statewide hiring freeze and reduced travel and other operating expenditures. The University announced at the end of March that all units should preserve funds to prepare for an impending state budget reduction. Close watch on spending and the hiring freeze make these funds available, though at the expense of year‐end purchases of equipment and supplie
The FY’21 proposed budgetary reductions, which could range from 6% to 14% depending on state revenue circumstances, will rely first on CARES Act federal stimulus fund distributions to higher education. Further salary savings and operating expense savings across the University will occur on an opportunistic basis, i.e., the hiring freeze will prevent hiring for vacant positions where they happen to be. Very strong justifications for replacements will be considered only when a source of funds is identified.
With these decisions will come very real consequences. These sacrifices may result in higher workloads for existing faculty during the FY’21 year as critical classes must be taught, critical research conducted and community outreach performed with fewer professors, instructors, student support and administrative personnel. There may be longer wait times for advising and tutoring services as well as potential reductions in course offerings and other wrap‐around services. Classified employees may be asked to do different jobs to fill in where critical vacancies remain. If the University is forced to cover a shortfall in State bond payments on buildings, some deferred maintenance projects will be delayed, exacerbating the existing shortfall. These consequences WILL NOT include Curricular Review of programs resulting in program closures. Also, this approach is designed to limit job layoffs to the greatest extent possible and only in the highest levels of budget reductions.
We will make sure that the University will engage its shared governance process with faculty, staff and student leaders to reduce the impact as much as possible. These sacrifices also come with recommendations for one year academic and administrative faculty employee furloughs of 6-12 days and temporary student fee surcharges as everyone contributes to sustaining the vitality of the University during this historically unprecedented and unforeseen pandemic crisis. Like during the recession, the people of our University quickly came to understand and support a shared sacrifice approach, from which the University emerged with significant momentum, having protected core programs in order to position itself for future success.
The University’s proposal asks for special consideration to reduce the impacts of budget reductions on the Nevada State Health Laboratory (a part of the University of Nevada, Reno School of Medicine), nursing programs, and medical school programs. These units provide for the further training of health care professionals for the workforce and provide health care services during the training of nurses and physicians.
The University of Nevada, Reno is now awaiting further action from the Governor and Board of Regents to determine the extent reductions must occur and for these plans to be put into action.
This is an extremely challenging moment. We are not only facing a pandemic being felt the world over, we are facing sudden economic upheaval and social disruption not experienced in our country since the Great Depression. Yet we have it within ourselves to get through it. In the past, the people of our University have chosen institutional unity of purpose contained in our mission to transform countless lives. The character, collaboration and care for one another that all of you have continually demonstrated over these past few weeks will help carry us through this challenging time. Please continue to keep your loved ones, your friends and yourself safe and healthy.
Marc A. Johnson