The Commonwealth of Virginia's projected revenue shortfall of at least $890 million in fiscal year 2002 has prompted deans of three schools to halt hirings of new faculty members. This comes after a decade of diminishing state support for the University and department heads have, once again, had to find ways to avert negative impact on students.
The College of Arts & Sciences, the Education School and the Architecture School have implemented sort-term hiring freezes in anticipation of a shortage of funding from the Commonwealth.
While problems caused by the budget shortfall "could be very serious" according to Robert Fatton, government and foreign affairs department chairman, the most visible effect of the freeze will be fewer and larger classes in departments that were forced to stop employment searches.
"There are several departments where majors have trouble signing up for the classes they need to graduate on time," said Lauren Purnell, student president of the College. "The hiring freeze will only increase the size of all our classes and create more frustration for both faculty and students."
Purnell also said the funding shortage has been affecting her discussions with College administrators about more funding for undergraduate research.
"Its hard to focus the administration's attention on research or any new programs when they do not even have enough funds to fully staff existing departments," she said.
However, College Dean Edward L. Ayers said the short-term hiring freeze minimizes possible long-term damage.
"Students will not be seeing the departure of the wonderful faculty and staff who have made U.Va. such a great place," Ayers said. "We are working to make sure that as many classes as possible are taught."
Twenty-five searches for new faculty were halted in the College because of the freeze.
Education School Dean David Breneman said the school halted four searches, but that none of them will cause extraordinary problems. He said if the freeze lasts too long to reopen the searches and other arrangements cannot be made for funding, advanced doctoral students or adjunct faculty would teach courses. Otherwise a few courses would not be offered next year.
"Barring something catastrophic, we have enough of a cushion," he said.
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Breneman also is exploring the possibility of receiving funds from the athletic department to fill a vacancy in the athletic training graduate program that is connected with University athletic teams.
Breneman added that cuts will not be made at this time to such expenses as travel and phone usage and that the searches did not affect the joint teacher education program with the College.
The Architecture School is stopping two tenure-track searches and one staff search, said Dean Karen Van Lengen. Van Lengen said this will cause the school to offer fewer elective courses and public events and to have a smaller operational budget.
But she said she is working to make the changes minimal. "Naturally we will make every effort to maintain our excellent teaching environment," she said.
"We are planning in a judicious and equitable climate where, fortunately, my staff and faculty are creative individuals, with a cooperative sense of the whole," she added.
Departments try to cope
Department heads are charged with adjusting plans to implement the freeze as directed by the deans. Many share the deans' fears concerning class number and size.
"We have way too many students for the number of faculty," Fatton said of the government and foreign affairs department.
He said three hiring searches for the department were canceled. That translates into 12 to 15 more courses that will have to be absorbed by the current faculty through larger class sizes or fewer course offerings.
"Seminars aren't really going to be seminars," he added. "It affects the quality of the teaching."
Economics Department Chairman David Mills said six searches initially were halted but that funding was restored to recover three.
"Classes will be larger than ideal next year, and larger than they were a few years back ... [however], the economics faculty will make every effort to accommodate our graduate and undergraduate students," Mills said.
English Department Chairman Michael Levenson said the English department had "very lucky and powerful hiring last year," so it will not be affected as much by this year's freeze.
He said his main concern, however, is funding for teaching assistants' salaries and fellowships, which he said was "shameful."
"I find it remarkable the excellence of teaching hasn't deteriorated in the face of insupportable funding," he said.
Budget shortfalls cause cuts
The hiring freezes were instituted after reports of a projected shortfall in revenue of over $890 million for the Commonwealth in the 2002 fiscal year.
The schools in the University where a larger percentage of the operating budget comes from the Commonwealth are most vulnerable to the change and are more likely to react to a possible decrease in state funds by making pre-emptive cuts.
"I decided the best avenue was to hold off on filling new positions, so if money was taken away, [the school] hasn't spent it already," Breneman said.
"I have a stronger responsibility to people who are here rather than ones I could have," he said.
Virginia Gov. James S. Gilmore III mandated a 2 percent cut for selected Commonwealth agencies Nov. 15, which means the University may lose $3.2 million of its annual budget, Vice President for Management and Budget Colette Sheehy said.
She added that this cut was from the general budget of the University and not from funding allocated to specific University projects.
After the announcement of the budget shortfall, her office then advised the deans to "do whatever possible to maintain flexibility in their budget."
Sheehy said she thinks Virginia's problems could run longer than the coming year because of the economic downturn.
Breneman, whose area of professional research focuses on funding for higher education, said he found Virginia to have a 7 percent structural deficit between long-term projected revenues versus spending. He said the problem was hidden during the economic expansion that lasted throughout most of the 1990s.
"When the economy cycles back down, all of a sudden those discrepancies get exposed," and that is causing Virginia's fiscal problems, he added.
Sheehy said that although the University already is under-funded by $200 million compared to its peer institutions, it is not as reliant on public funds because of a $1.7 billion endowment and other private funding.
"We do really well with what we have," she said.
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Dean of the College Ed Ayers is one of three deans who has implemented a hiring freeze in anticipation of budget cuts by the Commonwealth. Ayers said the freeze is a short-term solution to prevent long term damage from the budget shortfall.
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University President John T. Casteen III said the University and its schools are in better financial shape than they were 10 years ago during the last recession.
"Sudden, deep and ultimately unjustified cuts in state support in 1990-93, combined with the state's failure to restore the money when its problems were over, triggered the Capital Campaign, [the fund-raising drive which raised over $1 billion for the University] that ended in December 2000," Casteen said in an e-mail.
He said all universities are in the same spot during this recession, but that the University is "generally in better financial shape" because of the Board of Visitors' management of the endowment created by the Capital Campaign.
"The Board managed the market slump by a brilliantly executed set of derivative transactions," he added.
Casteen also said the larger problem for the University was the budget impasse during Virginia's last legislative session that prevented salary increases for state employees.
Will the tuition freeze be lifted?
One possible way to lessen the impact of Virginia's budget problems would be stopping the ban on tuition increases for in-state University students instituted in 1996.
"Our in-state tuition is pretty low," said Sheehy when asked about the possibility. Lifting the tuition freeze "would clearly change the situation."
Breneman said the University's tuition was the second most expensive among state institutions before the tuition freeze, but many universities have increased tuition sharply since that time.
"Now there is ample room for a response to allow a tuition increase," he said.
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"No one knows how much good or ill the [tuition] freeze has done, although most observers seem now to doubt that it has done any substantial good," Casteen said on the issue.
"My guess is that the new governor and the legislators will not simply repeat blunders or hasty decisions made in prior times - that this time they will figure out what the effects are before doing anything," he added.
Virginia Gov.-elect Mark Warner said during his campaign that he would not lift the ban, but Breneman said that it was not a huge issue and Warner could change his position.
Will rankings be affected?
Another concern regarding the hiring freezes and budget problems is whether they will affect the rankings and reputation of the University.
Breneman said the effect might not be as damaging because a lot of other universities will be taking similar measures.
"I don't see this hitting our rankings one way or another," he said. "But it's not certain."
He said that since the University already is ranked 65th in terms of dollars per student and also is ranked low in state support, the University will not suffer as much as other schools from large decreases in state funding.
Many state institutions looked to other sources of revenue after they fell in the rankings after the last recession, he added.
Casteen said the University was the only public institution to maintain its position in U.S. News and World Report's popular top 25 ranking during the last major recession.
Some deans and department chairs are concerned about how the possibility of prolonged budget problems could impact their rankings.
"The [economics] department's reputation certainly is affected by our ability to retain and hire faculty," Mills said.
Fatton agreed. The government department "clearly needs more faculty for the number of students."
Van Lengen also said the architecture program, which is the highest-ranked professional program at the University, could lose ground to other institutions in the face of long-term cuts.
"Our endowment is already significantly less than Harvard's and any prolonged budget crisis would indeed affect us," she said.