St. Aug's announces furloughs as it deals with budget crisis

jstancill@newsobserver.comFebruary 25, 2014 

— St. Augustine’s University will shut down for a week in March and furlough employees as it deals with a budget crisis.

On Tuesday, the university confirmed what had been anticipated on the historically black campus near downtown – employees will be forced to take time off without pay during the school’s spring break March 9-15. Workers will return to work March 17.

The university’s board of trustees met Monday to discuss next steps in an effort to turn St. Aug’s around.

“Although our situation is not unique, we are regretful that we have had to take this type of action,” the university’s president, Dianne Boardley Suber, said in a statement. “We recognize the impact that this furlough will have on families, and we don’t take this decision lightly. As an institution, we are focused on moving forward and are confident that the tough decisions we are making now will be of great benefit to the institution in the long run.”

Budget cuts have already taken a toll on the university’s workforce. Fifteen jobs were eliminated recently after a sharp downturn in enrollment resulted in a $3 million drop in tuition revenue, according to an audit obtained by The News & Observer.

Last fall, full-time equivalent enrollment had declined to 1,267, a decrease from 2012. Then, in January, about 200 students did not return for the spring semester, delivering another financial hit to the university.

The audit also revealed disorganized business functions, improper check-writing procedures, late accounting processes and failure to collect past-due accounts. Auditors recommended that the university follow through with compensating employees for overtime earned between 2011 and 2013, following a U.S. Department of Labor investigation of wrongly classified workers.

Facing contract suit

St. Aug’s also faces a lawsuit from the contractor on its football stadium over breach of contract. The university owes $675,000, and work has been halted on the project, according to the suit filed last month in Wake County.

The troubles have prompted concern about the university’s overall financial health at a time when historically black colleges are struggling to maintain enrollment.

In addition to the recent layoffs, the university has seen the departure of several high-level administrators in recent months, including the finance and fundraising chiefs.

The furlough will not affect all employees. Student workers, employees who make less than $30,000 and those who work less than half time will be exempt. Campus safety and health clinic employees will remain on duty. Of these groups, except for campus safety, employees will have to use accrued leave for that week.

In a memo to employees Monday, Suber wrote: “It has been a very tough time for our university family as we work very hard to meet the needs of our students while maintaining the academic qualities that we have come to know and appreciate. We have engaged many of you in meetings over the last few months as we try to make the best decisions and review the financial matters affecting the University. We have shared with the Board where we are and our plan for recovery.”

Tuesday’s announcement did not provide any details about the school’s larger recovery strategy. Suber was at the Central Intercollegiate Athletic Association’s basketball tournament in Charlotte and could not be reached for comment.

Stancill: 919-829-4559

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