Faced with a sharp drop in revenue, NCDOT furloughs thousands of employees statewide
N.C. Department of Transportation employees were told Monday that they will need to take unpaid time off by the end of June to help the department save money.
The furloughs begin this week with “executive leadership,” who must take 30 hours of unpaid leave, followed next week by “senior leadership,” who must take 25 hours. All other employees must take 20 hours of unpaid time off, starting May 30.
NCDOT’s 9,300 state employees have until June 26 to fulfill their furlough requirement.
“This is a challenging and uncertain time for all employees within the Department,” Transportation Secretary Eric Boyette wrote in an email to NCDOT employees announcing the furloughs. “This plan allows us to maintain critical operations while at the same time reducing our spending.”
The furloughs will save NCDOT about $7 million, said Greer Beaty, deputy secretary for communications.
The move is part of broader cost-cutting that began last month after the coronavirus outbreak, and policies meant to curb the spread of the virus, cut into the department’s revenue. Gas tax payments, which account for more than half of NCDOT’s state revenue, dropped sharply as people stayed home, while car sales taxes and income from fees, mostly paid to the Division of Motor Vehicles, also declined.
NCDOT says it will receive $300 million less in revenue than it expected in April, May and June, and it forecasts an even larger decline in the fiscal year that begins July 1.
Furloughs staggered to buy time
In a statement released late Monday, Boyette said the start of the furloughs was staggered in hopes NCDOT will find another way to solve its financial problems before most employees are affected.
The coronavirus relief bill approved by the General Assembly includes $300 million in federal money for NCDOT, but only if the federal government lets state agencies use money from the CARES Act, the congressional relief bill, to replace lost tax revenue.
“We began furloughs with executive staff as leadership must begin at the top,” Boyette said in the statement. “My hope is that we identify ways to replace lost revenue so that rank-and-file employees are never furloughed.“
Among other cost-cutting measures, the department has laid off temporary and contract workers and stopped planning work on dozens of construction projects. The passenger ferry between Hatteras and Ocracoke has been canceled for the summer, saving $1 million, and on Monday, NCDOT’s Piedmont passenger train service between Charlotte and Raleigh was replaced by the Carolinian, saving about $13,000 a day in equipment and maintenance costs.
In his email to employees, Boyette said the cuts made so far haven’t been enough.
“The current pandemic situation continues to impact our business significantly,” he wrote, “and as a result, difficult programmatic and personnel decisions must continue to occur.”
NCDOT employees cannot take more than eight hours of unpaid leave per week, Boyette wrote, and will need to work with their managers to schedule the time “while still maintaining the ability to serve the people of North Carolina.”
No decisions about additional furloughs in the coming fiscal year have been made, according to the department.
This story was originally published May 18, 2020 at 7:01 PM.
