ECU FACES TOUGH FINANCIAL TIMES
Revised February 4, 2009
The ECU community, our friends and constituencies, and interested parties throughout the state are surely aware of the global financial crisis and the stress it has put on the entire state of North Carolina. This financial situation is impossible to predict with certainty, but most estimates are that it will be with us for at least another two years, that it will continue to be severe, and that it will have negative consequences throughout higher education.
I want our community to understand how we are affected and how we are responding. ECU, like all universities in the University of North Carolina system, is responding to a 6 percent “reversion” or deduction of appropriated funds for this fiscal year. This means that out of $260 million of state funding, we will not receive $15.5 million this year. About $3 million will be from our medical programs and about $12.5 million from the east campus. There is no guarantee that 6% is the ceiling; we are prepared for 7-8% one-time cuts.
We are meeting this cutback by delaying hirings or canceling searches, reducing costs in every way possible, conserving our resources, putting off purchases, and consolidating services. What we will not do is sacrifice our priorities. So, for example, we are actively building the dental school under the great leadership of Dr. Jim Hupp, and we will fund and expect strong services from the Pirate Tutoring Center which helps so many of our beginning students.
All ECU employees, students, and friends should realize that the real danger is base budget cuts throughout the next biennium (July 2009 through June 2011). We are preparing plans for base cuts between 3 percent and 7 percent for fiscal year 2009-2010. A 7 percent cut would mean that we would have to reduce staff and programs and services by $20 million. If the economy dictates further cuts in fiscal year 2010-11, every aspect of the university would be affected.
Under such a worst-case scenario, we have identified responses that include: consolidation of many support services into centralized and more efficient operations, outsourcing, loss of numerous administrative positions, freezes on travel and many other normal activities, postponed hiring, furloughs, and even reductions in force. Economic conditions dictate that we must be prepared for any eventuality, all the while hoping that North Carolina’s strong regional economy shields us from the educational destruction that is already occurring in some states.
So much for the harsh reality. During these tough times, let’s not lose track of the progress we have made and our great future. Our primary goal should be to emerge from the economic downturn with our priorities intact and to maintain our commitments to our state and region.
The way to do this is to maintain the priorities in our strategic plan and to focus on our community. We are all in this together and we will respond as one university. Here are five specific commitments that our administration is making:
- We will do everything possible to minimize the fiscal impact on our students and we will maintain our top priority of providing a 21st Century Education;
- We will protect our academic core and biggest strengths, all the while insisting on high-quality performance and accountability;
- We will be true to our mission of service and regional transformation;As we have shown over the last three years, we will continue to improve efficiency and seek the best business practices;
- We will form even better partnerships and collaborations because they help us save resources and be more productive; and
- We are initiating a campus-wide budget review task force this week to help ensure good communication and identification of more options to reduce costs and generate revenue.
We all recognize that times are tough. We will do our part and we will be better for it. Tomorrow starts here.
