New Orleans, La. - The University of New Orleans is initiating a plan of budget reduction and savings that will total approximately $12 million by the end of the current fiscal year, President Peter J. Fos announced Tuesday.
The cuts are due to a reduction in the University's state appropriation of $9.3 million and increases in retirement costs, fringe benefits and other mandated expenses as well as an expected moderate decline in enrollment for the fall 2012 semester, said Fos.
"These represent the most significant budget cuts in the history of our institution," Fos said. "We undertook this process with great deliberation, intent on preserving the academic core of the University. We solicited feedback from both academic and non-academic personnel. And we were still faced with some very difficult choices. I am disappointed that we have been forced to eliminate instructor and staff positions, but we simply don't have any choice. We remain committed to maintaining academic quality and giving our students the best university experience possible."
The University's total operating budget this year totals approximately $111 million. Although state approved tuition increases allowed under the LA Grad Act have increased self-generated revenue to $71 million of the school's budget, these adjustments have not been sufficient enough to offset an overall decline in state support to the University.
The budget reduction plan includes incentivized faculty retirements (projected to be approximately 25), incentivized classified staff retirements (projected to be approximately 28), elimination of vacant faculty positions (30), terminal contracts to faculty (5), elimination of funding for graduate assistantships (26) and elimination of non-classified staff (16, including 5 in administration), resulting in a cumulative savings of $3.3 million.
Other savings will be achieved through several approaches including:
· Mandatory annual leave for seven days for staff and administrators. This will allow the University to close buildings during Spring Break and Lundi Gras to save on utilities (expected savings of $100,000).
· Outsourcing the University bookstore. This is expected to be completed by December 2012 (pending approval of University of Louisiana Board of Supervisors). The immediate impact will be a cash savings of $500,000.
· Anticipated lease of university property to third party (pending approval of University of Louisiana Board of Supervisors); expected to bring in $100,000 to $120,000 annually.
· Reduction in adjunct faculty budget ($250,000)
· Reduction in travel expenditures by 47% ($329,000)