UNC system prepares for budget cuts

The 16-campus system won't know the extent of budget cuts until the General Assembly passes a 2009-11 budget, but Bowles said the universities would start cutting administrative costs to protect academics as much as possible.

UNC officials presented the Board of Governors with the extreme scenario of a 15 percent cut across the system. That would entail reducing spending by $450 million – officials said that is equal to the combined budgets of eight UNC campuses – and would require a 56 percent tuition increase, which administrators said would be unfeasible.

“We don’t think that is going to happen, but not to plan, I think, would be shortsighted,” Bowles said. “What we’ve tried to do is what any organization should do when they face difficult times, and that is really plan. So, we’ve run scenarios with very large cuts and with smaller cuts to plan what we’ll do if it happens.”

Gov. Beverly Perdue's budget proposal for 2009-11 calls for the UNC system to receive $168 million less than Bowles and campus chancellors had expected. The Senate budget proposal would cut $35 million from the universities.

UNC officials have said the system could support a one-time $127 million spending reduction. A $168 million cut could mean 400 to 500 layoffs across the university system, officials said. Most would be non-faculty jobs, but leaders warned of larger class sizes, fewer advisers, less maintenance and program reductions.

Bowles said the UNC system would never cut financial aid and would protect the academic core of each campus as much as possible.

All state agencies, including university campuses, have been ordered to reduce spending by 7 to 9 percent by the end of June to help close a $3 billion budget deficit in the 2008-09 fiscal year. Projections call for state revenue to be short by $4.6 billion in the 2009-10 fiscal year, which starts in July.