Furlough and Student Surcharge Outcomes from NSHE Board of Regents June 19, 2009

June 22, 2009

Las Vegas, Nevada – June 19, 2009

The Board of Regents took action today to implement legislatively required budget reductions through the use of an employee furlough program and temporary increases to student fees.

Based on recommendations from Board Chair Michael Wixom and Vice Chair Jason Geddes, the Nevada System of Higher Education will implement general professional personnel cost reduction measures in FY 2010, followed by a mandatory furlough program in FY 2011 to reduce professional staff and faculty salaries with an option for an increased workload for tenured faculty. The aim of the program is to meet the intent of Senate Bill 433 which calls for a four percent reduction each year of the biennium. This program will not affect part-time teaching faculty.

Classified staff have already received a legislatively mandated furlough program of one day per month for FY 2010 and FY 2011.

In addition, a five percent surcharge (as referenced in Option A of the Board agenda) will be added to student fees for each year of the biennium (five percent in FY 2010 and an additional five percent in FY 2011) starting with fall semester 2009.

The surcharge will not be effective until the spring semester of 2010 for Nevada’s four community colleges: College of Southern Nevada, Great Basin College, Truckee Meadows Community College and Western Nevada College.

All surcharges will sunset in 2011.

Regents heard testimony from faculty and student leaders about the proposed options, with students voicing strong support for Option A in the fee increase proposal.

Due to the timeline dictated by SB 433, the Board passed an emergency motion to implement the personnel cost reduction measures. The Board then has 120 days to make the reductions final and to make changes in the program if the need arises.

Specifics on the furlough and workload increase programs are expected to be communicated to NSHE employees in the next several days.

Below is the motion that was unanimously approved by the Board of Regents today:
1. The adoption of Option A–a temporary surcharge for registration fees as set forth in the tuition and fee increase reference materials;
2. The adoption of a Code amendment set forth below which is subject to the considerations numbered 1-7 set forth at pages 3-4 in the Memorandum of Chair Wixom and Vice Chair Geddes, dated June 17, 2009 to the NSHE Regents, entitled “Senate Bill 433″ Implementation Recommendation”; and
3. The adoption of an emergency amendment of the NSHE Code (requires 7 votes and is immediately effective for 120 days, to be made permanent by further Board action), in accordance with Title 2, Chapter 1, Sec. 1.3.3.b due to the 2009 Legislative budgetary action and NSHE faculty contract provisions. The proposed amendment to the Code is the adoption of a new Code provision added to Title 2, Ch. 5, as Section 5.5.7, as follows:

Notwithstanding Title 2, Section 5.4, as the 75th Session of the Nevada Legislature has explicitly appropriated a lower amount for NSHE salaries than would otherwise be authorized and appropriate according to the NSHE salary policies, the Board of Regents does hereby and for the 2009-2011 biennium only, temporarily reduce salaries through the use of unpaid leave in an amount equivalent to the amount of legislative salary cut for FY 2011. The Board shall, to the extent feasible, devise methods that protect base compensation and benefits and shall offer tenured faculty an alternative of unpaid teaching workload increases in lieu of unpaid leave. The various Presidents shall consult with their respective faculty senates regarding the implementation of this section. Unpaid leave or temporary workload increases required by this section are final and not subject to appeal, grievance or reconsideration. The provisions of this section shall constitute constructive notice to all faculty and no individual notice to any such faculty member shall be required hereunder to implement the foregoing. To the extent any conflict or inconsistency between this and any other section of the Code exists, the provisions of this section shall control. This section will terminate on June 30, 2011.

Statement of the UNR Faculty Senate Chair (Presented to the NSHE Board of Regents Friday, June 19, 2009)

June 22, 2009

The faculty of UNR are grateful to the Legislature, the Board of Regents, and the citizens of this state for their efforts to defend higher education from a devastating budget reduction that would have effectively dismantled the NSHE system into the indefinite future. We also want to express our admiration for our students for recognizing that the education they receive is valuable, and appreciate that they are willing to pay more to help us keep providing it.

We recognize that this proposal represents serious work by many people, in an effort to balance what the Legislature wanted us to do with what we can legally do and what is wise to do. We know that the Regents are doing their best to balance these demands.

For legitimate legal reasons, this proposal gives tenured faculty the option to increase their work responsibilities instead of taking the pay cut, but this option is not given to others.

In the last several days as I have been getting input from my constituents, I have noticed a pattern. Those who were most concerned with the apparent unfairness of this – including myself – are themselves tenured. Those who were the least concerned about it are themselves untenured.

As I worry about the morale effects of separating out our faculty for differential treatment for legal reasons, it brings me great comfort to know that many of our people are so unselfish, and so concerned for their colleagues.

Still, in my opinion, it would be a good idea to give more people the option to do more, and not just require them to do less. Please consider whether the options this proposal makes available to tenured faculty might best be made available to others.

Faculty at my university are willing to do their part, and most of us are not opposed to temporary pay cuts if the Regents deem them necessary, but we want them to be done carefully because we are concerned with negative unintended consequences.

The Legislature recognized in SB 433 that NSHE was a special and complicated case, and gave the Regents the flexibility to institute pay cuts in other ways. We need to take this opportunity to make sure that we are taking the wisest path.

This proposal explicitly exempts DRI’s professional staff if they are entirely funded by grants. We strongly support this. What we would ask you to understand is that there are units at UNR that are exactly like DRI, and I assume these exist at UNLV too.

The Terawatt Facility and the Center for the Application of Substance Abuse Technologies, for example, both depend entirely on grants. There are also many research programs within departments that greatly augment their budgets and their support for students through extramural grant activities, and provide additional overhead for the university.

Making them take furloughs out of a sense of fairness simply hurts our budgets and our state economy, with no savings to NSHE or the state budget. Some may lose grants or contracts they can no longer fulfill, and most will reduce the amount of overhead that they bring to the university.

Some of you work for law firms, or other similar professional firms. Suppose the office manager has reduced the wages of the secretarial staff because of budget problems. To be fair, your office manager tells you that you must also work less and reduce your billable hours. It seems to me that that would only make the firm’s budget problem worse.

The UNR faculty senate overwhelmingly supported a resolution to apply reductions in state support only to state-funded salaries. At least, we should allow our Presidents to exempt some of our people from salary cuts if no savings would result. The principle that exempts DRI is equally applicable to similarly-generated funds at any of the NSHE institutions.

One part of the rationale for making higher education absorb most of the state’s budget reduction was that higher education should and could be more entrepreneurial, more like DRI, and less dependent on state funding.

Thus, I think we may be missing out on an opportunity. There are potential outside resources now available to many of our people. Now is the time to develop creative policy that empowers and incentivizes faculty seeking these resources, but we have rules that undermine some of the incentive to go after them, and these salary cuts will make it worse. Let us take this time of crisis to encourage our people to apply for more grants and contracts, to allow them the opportunity to make up for the reduction in their state funding, and to encourage more entrepreneurship by our faculty.

These changes should be left to individual institutions that can best understand and balance their missions and opportunities to meet the budget challenges. The Board can and should frame the parameters to consider, but ultimately our response to SB 433 should be measured by how thoughtfully we meet our missions within the budget constraints we face rather than following a literal reading of the bill.

Statement of the Faculty Senate of the University of Nevada, Reno

June 8, 2009

During this fiscal crisis the Board of Regents has continued to respect the leadership and autonomy of the NSHE institutions in meeting the extraordinary budgetary challenges of the past year. The Faculty Senate of the University of Nevada, Reno urges the Board to continue to allow each institution the opportunity to approach these challenges in ways that preserve the primary missions of the institutions with the least possible impact on faculty, students, and staff.

The Faculty Senate of the University of Nevada, Reno opposes financial exigency as both unnecessary and damaging to the reputation of the system. We similarly oppose either suspending or hastily modifying the Code.

In meeting these economic challenges, it is the shared value of our faculty that salaries should not be reduced if these cuts do not result in real savings for NSHE. In particular, salaries funded from many non-state sources should be exempted from reductions that may be deemed necessary to meet budgetary goals. Such reductions would be harmful to the research and economic diversification goals of the NSHE institutions, and harmful to the economy of the state.