NAU is planning campus-wide budget cuts effective at the beginning of the new fiscal year, according to an email sent by President Rita Cheng to faculty. The cuts, which will include furloughs and salary reductions at the executive, administrative and faculty levels, were deemed necessary to keep the current standard of operation.
After stating that there will be fairly distributed budget cuts across the university, Cheng explained these cuts will start at the top of the faculty chain.
“Pay cuts will start with me and include my executive team,” Cheng’s email stated. “We will be taking a 10 percent pay cut for fiscal year 2021, effective July 1.”
Along with Cheng and her team, the email stated that salary reductions will also occur within the university’s senior administration staff. These presumptive pay cuts or furloughs are structured in a tiered format so those who are ranked higher on the university’s pay scale will experience more of a reduction than those who are lower positioned.
Faculty pay cuts are estimated to range between five and 10 percent, but exact figures will remain unknown until after July 1, or the beginning of the upcoming fiscal year.
For the budget, one significant factor is the sheer drop in student enrollment resulting from the COVID-19 pandemic. According to Cheng’s email, this decline is projected as nearly 20 percent for the fall 2020 semester, which will eventually contribute to the faculty pay cuts around the university.
"While our enrollment picture is changing daily, it is clear we will have a smaller student population in the fall, as has been presented to our campus community through a number of reports and presentations," Cheng stated.
Furthermore, the ongoing hiring freeze left over 280 positions empty in order to limit financial impacts to current employees. The email also stated that the university plans to issue contracts to nearly 95 percent of all fall 2020 instructional faculty. This system would provide its recipients with definitive employment at NAU for nine to 12 months.
While some aspects of NAU's financial budget plan are clear, several potential implementations are still being considered for the upcoming fiscal year. A few additional measures that are currently under review include a voluntary early retirement program, curriculum streamlining and a modification of outside services or contracts, according to Cheng’s email.
“I will continue to communicate and engage with every part of our community, listening to your suggestions and providing updates about our response, planning efforts, and budgetary implications,” Cheng stated.
Cheng also emphasized that NAU's executive team and COVID-19 Recovery Workgroup are continuously working through community recommendations as they attempt to outline a comprehensive financial plan for the university.