University tightens budget for economy

‘ ‘ ‘ Pitt will have to cut back in its administrative offices in order to weather the economic… ‘ ‘ ‘ Pitt will have to cut back in its administrative offices in order to weather the economic crisis, Chancellor Mark Nordenberg said in an open letter. ‘ ‘ ‘ The state is withholding $11.3 million in funding from Pitt, he said. As a state-affiliated university, Pitt receives funding from the Commonwealth of Pennsylvania each year. But this year, the state formed a reserve account holding 6 percent of the money the school would normally receive. ‘ ‘ ‘ Nordenberg is already making backup plans in case the state doesn’t release the funds, said Renny Clark, Pitt’s vice chancellor for community initiatives and the chancellor’s office chief of staff. The chancellor asked people working in each of the University’s four main organizational units, known as super responsibility centers, to find a way to cut back their expenses. The four units include the Office of the Provost, the Office of the Budget and Controller, the senior vice chancellor of health sciences and the executive vice chancellor, who deals with investments and facilities management, among other things. ‘ ‘ ‘ ‘Everyone was given a target number and asked to find ways to meet that target,’ said Clark. ‘[The chancellor] pushed implementation of plans down to the super operating centers.’ ‘ ‘ ‘ Nordenberg suggested, and the Board of Trustees approved, a salary freeze for the 2009 fiscal year for University officers, including the chancellor, all vice chancellors and the Board of Trustees. The salary freeze will not affect faculty or staff, who received raises in September, said Clark. ‘ ‘ ‘ The last freeze occurred in the 1995-96 academic year but affected all employees. ‘ ‘ ‘ ‘Broadly shared sacrifices almost certainly will be required as we work to deal effectively with still-unfolding fiscal challenges, and it was appropriate for those sacrifices to begin with the officers of the University,’ said Nordenberg in his update. ‘ ‘ ‘ Nordenberg also said in the update that Pitt will hire people more conservatively and be more cautious before it commits to projects. ‘ ‘ ‘ Clark said he didn’t know much about whether tuition would rise next year. ‘ ‘ ‘ ‘A key factor in that will be the governor’s budget presentation in February,’ he said. ‘ ‘ ‘ He added that the state originally held 4.25 percent of the money in the reserve, and the Commonwealth raised the level early in December. ‘ ‘ ‘ The state is also withholding funds from Lincoln, Penn State and Temple universities, said Clark. The state will decide later whether to release the money, depending on the state of the economy. ‘ ‘ ‘ Pitt will work with higher education organizations, such as the American Association of Universities, to encourage the state legislature to release the funds, said Clark. ‘ ‘ ‘ ‘The government has implemented reductions and freezes across the state government system,’ said Clark. ‘We’re communicating messages to congress about the importance of higher education. Proponents of higher education see it as an investment in the vitality of the country.’ ‘ ‘ ‘ Pitt will use the state budget as the first indication of where it needs to start with planning for the 2010 fiscal year, said Clark. ‘ ‘ ‘ ‘We obviously will need to approach the structuring of the University budget for the next fiscal year with the knowledge that significant economic challenges almost certainly will continue to be with us and with the shared understanding that fiscal restraint will be essential,’ said Nordenberg in the update. ‘ ‘ ‘ In the meantime, Pitt plans to go ahead with its $2 billion ‘Building Our Future Together’ capital campaign started in 2000. ‘ ‘ ‘ Clark said, ‘Our donors continue to be supportive of the University.’ ‘ ‘ ‘