Facing ‘deep financial’ challenges from COVID-19, UNC System sets budget priorities
College campuses across North Carolina are still figuring out how they might bring students, faculty and staff back for the spring semester while balancing safety, budget concerns and the academic experience.
There is no question that the year ahead will bring deep financial and operational challenges for the UNC System, President Peter Hans said Thursday at a meeting of the UNC Board of Governors.
“This is not a moment for sweeping plans,” Hans said referring to the budget. “This is a moment for keeping our most important promises to the students and citizens of North Carolina, including identifying potential savings that can be carried forward into the next fiscal year.”
Hans said the budget request “recognizes reality, while protecting our core academic mission.”
Enrollment growth a priority
The board’s budget and finance committee members discussed the 2021-23 priorities Wednesday, keeping in mind that early predictions show recurring revenue will be limited.
North Carolina’s Office of State Budget and Management delayed issuing instructions for budget request submissions until the revenue picture becomes more clear. With this uncertainty, the UNC System office recommend focusing on four core needs.
The plan is to ensure full funding for building reserves and enrollment growth, which is important considering the UNC System added a record-breaking number of students this fall. The board also is asking for continued support of the NC Promise program, which lowered tuition and increased access for students at Western Carolina University, UNC Pembroke and Elizabeth City State University.
The board will also ask for money to support faculty and staff salaries, particularly as they have worked to adapt during the pandemic.
“We want to keep that deep bench of talent and innovation right here,” Hans said.
The UNC System will not be asking for new projects or initiatives and won’t be “entertaining” any campus-specific operating budget requests.
“Our university system cannot depend on federal stimulus bailouts to solve our financial challenges,” Board Chair Randy Ramsey said at the meeting. “This pandemic will affect state revenue for years, and the UNC System will not be immune to those impacts.”
Challenges at campuses
At a media briefing after the meeting, Ramsey and Hans were asked about potential layoffs and salary cuts for faculty and staff.
Hans said it’s too soon to say, considering the uncertainty of the pandemic and future state and federal funding.
The areas that have been hit hardest are auxiliary enterprises like housing, dining, transportation and athletics, which are driven by revenue from having people on campus.
Some universities have already announced furloughs and salary reductions for staff in those departments, including at UNC-Chapel Hill, N.C. State and East Carolina University. Those schools lost revenue after pivoting to online learning and closed dorms because of the spread of COVID-19 on campus.
Thousands of students are still living on campus and taking classes or doing research at those three universities, and the campuses are planning for spring. The other institutions in the UNC System have not made drastic changes to campus operations this fall.
Hans said he is in constant contact with chancellors and local health officials about decisions for the spring semester, including housing plans and in-person or online classes.
“There are no easy options right now for any of us,” Hans said.
He plans to discuss the progress of the COVID-19 plans for each campus at the next board meeting in November.
Improving access and affordability
The economic conditions stressing the state budget will also create an “unprecedented need for access” to UNC System institutions, Hans said. Hundreds of thousands of people will be looking for educational opportunities to launch new careers and get better jobs and many will find them at North Carolina’s community colleges, he said.
The board passed an agreement that creates a clear path for students from community colleges to transfer to a four-year institution. The Transfer Advisory Committee is working on ways to improve transfer policies and make recommendations, including technological improvements like common-course numbering for classes across institutions.
“When we fail to provide good options, flexible options those students wind up in places where they’re more likely to leave with a lot of debt and little to show for it,” Hans said.
Hans said he also plans to simplify financial aid, make the path to graduation clearer at all institutions and provide additional support to teach the science of reading that will boost 3rd-grade reading proficiency.
The board set up a task force on pricing, flexibility and affordability that will focus on the cost of college, which Ramsey said is particularly important during this time.
“We must look hard at our tuition and fee structure and balance the revenue needs of our campuses with our commitment to maintaining high-quality, affordable education accessible for all students,” Ramsey said.
The board’s budget and finance committee will have a special meeting on tuition and student fees in November.
The UNC System will host its first virtual open house for prospective students, families and high school counselors to explore all 16 universities online. The program will take place during the week of Oct. 26 and will offer a virtual tour of campuses and include presentations from faculty, staff and current college students.
