As we look back over the last several years of the recession, we can see considerable budgetary challenges. During this time, the budget for higher education and for NC State has taken escalating reductions. The cuts have been painful. We have lost jobs, class seats and course sessions. There is less financial aid and tuition is higher.
Yesterday, the Board of Governors approved state budget allocations that included more than 15 percent in reductions for NC State. That represents a loss of about $80 million from our appropriated budget. There is no doubt that there is considerable pain in this budget reduction.
But, as I said in my installation speech, we are not going to let budget challenges cripple us. We will move forward by thinking differently about the way we are organized and operate. If there is positive news in this budget environment, it’s this: the combined efforts of our organizational realignment, strategic planning and ongoing budget planning have positioned us to lessen the impact of the reduction.
We have given ourselves the ability to keep moving forward in a resource-constrained environment. And, we will do so without further tuition increases for the upcoming academic year.
We will be able to limit cuts on the academic side to about 7 percent; on the administrative side, the reductions to the units are typically in the 10 percent range. Not a perfect scenario, but certainly better than 15 percent.
The tireless efforts of many people at NC State have contributed significantly to the campuswide strategic planning process and organizational realignment. With their input, we have the method and means to strategically focus our resources on our academic core, deliver on our research and economic development mission and support organizational excellence.
Also, over the last three years, we have taken budget planning steps to prepare ourselves for just such a budget as this one by, for example, making one-time expenditures rather than recurring investments. Those one-time dollars are then unencumbered in the next budget cycle. Units have also taken steps to hold vacant positions open, which helps to spare us some loss of filled positions.
Even with all the hard work we have done across campus, this remains a difficult time for NC State. While we have positioned ourselves to offset some of this 15 percent reduction this year, repeated, drastic budget cuts over the last several years have exhausted our ability to sustain further losses.
We will continue to do everything we can to preserve the quality of the education we provide to students and the vitality of this university. We will do all we can to continue to be an engine for the kind of economic development that will bring North Carolina back to prosperity. We have been good stewards of taxpayer dollars. We have been good partners with North Carolina. We are a national best value delivering on the promise of quality, affordable education. It is not possible for us to continue to be all those things while our financial support continually erodes.
I know this is a time of great anxiety for everyone, particularly our employees, who have not had a salary increase in three years and who have shouldered the load of lost jobs. I thank you for your dedication to NC State, the state of North Carolina and our students.
The work of creating this year’s university budget is almost over. We are working out the details with the deans and executive officers to provide clarity on unit allocations and should know more next week.
Like you, I am hopeful that the economy is on the way up and that we have weathered the worst of our budget reductions. As we put the budget conversation behind us, we can get on to the work of preparing ourselves for a new academic year with an extra measure of optimism and a renewed pride in NC State University.