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June 20, 1996

Budget could bring pay raises, reductions in workforce here

The good news for fiscal 1997: Possible pay hikes of 4 percent.

The bad news: A possible workforce reduction of 4.5 percent.

For faculty and staff, that's the good and the bad of the FY 97 budget that the University Planning and Budgeting Committee (UPBC) has recommended to Chancellor Mark Nordenberg.

UPBC's budget recommendation also contains a 4.5 percent tuition increase and calls for Pitt to spend $1.25 million for improvements to education and student life on campus, and $2 million for the continued implementation of a new information management system.

In addition, it recommends that anticipated increases in athletic revenues be used to reduce the current level of support provided for athletics from general funds.

All of the recommendations concern only the educational and general portions of the total University budget. They do not include the budget for the University of Pittsburgh Medical Center, which includes the School of Medicine.

If Nordenberg approves the budget plan, it will be passed on to the Board of Trustees' executive committee for approval at its tentatively scheduled July 19 meeting, according to the office of the Secretary of the Board of Trustees. UPBC chair Provost James Maher was unavailable for comment, but Faculty of Arts and Sciences Dean Peter Koehler, chair of UPBC's budget parameters subcommittee, said the budget recommendation is based on the assumption that Pitt will not receive an increase in its state appropriation for FY 97. Gov. Tom Ridge's proposed state budget is currently being debated in the General Assembly. It contains virtually no increase over last year in Pitt's state appropriation of $147,265,000. The legislature could change Ridge's budget to include more money for higher education, but Koehler said such an action is highly unlikely.

In the budget submitted to the Department of Education last fall, Pitt had requested a 6.5 percent increase in its state appropriation. Based on that increase, the University proposed a 5 percent salary increase and 3.5 percent tuition hike, figures that had to be revised because of the stagnant Ridge budget.

Contrary to reports that claimed approximately 430 jobs would be lost at Pitt because of the workforce reduction contained in the UPBC budget recommendation, Koehler said he does not know what the job loss number might be because his committee worked with percentages.

The UPBC budget plan recommends that "to the extent possible" reductions in faculty and staff be made through attrition and every effort be made to minimize layoffs. It also recommends that an early retirement plan for faculty be implemented as soon as possible and serious consideration be given to an early retirement plan for staff.

According to Koehler, discussions are now being conducted on an early retirement plan for faculty. "Whether it will include staff too will depend upon what we are trying to achieve in terms of reductions," he said. "I can't predict exactly how that will come out." How many employees might be laid off will depend upon the number of faculty and staff who retire or otherwise voluntarily leave the University and the types of positions they occupy. The more highly paid employees who leave, the fewer jobs that will need to be cut before reduction goals are met. Koehler did not know how many employees might be laid off. If realizing a 4.5 percent workforce reduction in FY97 should prove impossible without causing significant harm to the University, the budget recommendation suggests spreading it out over a longer period of time and making up the first-year shortfall in savings from unspecified other sources on a one-time-only basis.

Although the UPBC plan supports a workforce reduction, it recommends that job cuts should not be across-the-board, but should reflect academic priorities, and be done in ways to maximize the efficiency and effectiveness of academic support units.

Even if the 4.5 percent workforce reduction for FY 97 is met, that does not mean there will not be future layoffs. According to UPBC's budget recommendation, the 4.5 percent reduction should be regarded as a first step in a multi-year process aimed at creating a balance among the size of the University's faculty and staff, its missions and its resources.

The balancing process should be linked to ongoing efforts examining was to eliminate unnecessary duplication, according to the plan, increase administrative efficiency and outsource certain functions now performed by the University.

"The ratio of tuition income and payroll expense is such that for every 1 percent of raise that you give, you have to raise tuition by 1.5 percent," Koehler said. "That's really an imbalance. If the state gives you nothing extra, you're really in a fix." Koehler said the University needs to embark on a plan to bring salary and tuition figures into balance, especially since Pitt does not know what it can count on from the state in the future. "We need to start to critically look at the amount of money we spend on compensation at all levels of faculty and staff, all levels of employees, to see if we can bring that into better balance with our income from tuition," Koehler said.

However, the $1.25 million in student life initiatives contained in the budget recommendation cannot wait, according to Koehler. He said Pitt needs to become more competitive in what it offers in the way of student life amenities in order to attract more students and better students.

"If we don't attract the number and quality of students we want, we will no longer be the institution that we should be," Koehler said. "That's really the problem. That's where academics and fiscal things come together." Education and student life improvements contained in the UPBC budget recommendation are as follows: * Network access: The University will use $500,000 to implement a program to provide computer network access to every residence hall room on campus. The cost is estimated at $417 per port or about $2 million over the next four years. The per student charge for each activated port will be $65 per term.

* Recreational programs: Approximately $250,000 will be used to develop a student recreation facility in the gymnasium and associated spaces in Bellefield Hall. The facility will be for both open recreation and intramural team use. Staff and security will cost an additional $100,000 annually.

* Campus safety: To improve campus safety, about $150,000 will be used to recruit additional police and provide additional training to campus police.

* Learning Skills Center: Roughly $15,000 will go toward purchasing additional software for the University's computer labs and $60,000 for the hiring of tutors and creation of study groups to aid students in introductory courses in physics, chemistry and biology.

* Disability resources and services: Permanent funding of $50,000 annually will be provided for academic support services, including additional professional staff, for students with disabilities.

* First-year students: Approximately $125,000 will be used to build on the University's Freshmen Year Experience course to assist first-year students in becoming acclimated to the University environment.

* Living/learning program: Between $35,000 and $70,000 will be used to establish at least one living/learning cluster to integrate the residence and academic lives of students.

–Mike Sajna


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