Cash-strapped UVI facing difficult future, university president warns staff, faculty


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ST. THOMAS - University of the Virgin Islands President David Hall held a town meeting for UVI staff and faculty Thursday in an effort to bring them up to speed on the university's precarious financial situation.

Hall has refused to speak to The Daily News about UVI's budget issues and whether staff will have their 8 percent salary cuts restored in July until he has met with Gov. John deJongh Jr.

He told UVI staff Thursday that he has a meeting scheduled with the governor March 22.

At the town hall meeting, which was videoconferenced to the UVI facilities on St. Croix and St. John, Hall said UVI already is dealing with a $3.5 million budget reduction for the current fiscal year. He said he recently was informed by the Office of Management and Budget that UVI - along with all other government departments and agencies - would have to take a 5 percent budget cut for the remainder of the fiscal year.

"That was bad, but it was something we could manage," Hall said.

Not long after that notification, the university was given a FY 2014 budget ceiling of $27.4 million - $1.4 million less than the $28.8 million appropriated in FY 2013.

Unless he can convince the governor and the Senate to change the 2014 budget appropriation for UVI, difficult choices will have to be made to absorb the cut, Hall said.

Hall said he is considering two primary options: eliminating vacant positions or instituting an across-the-board budget cut for all departments.

To balance out the $1.4 million shortage, 12 vacant faculty positions and 11 vacant staff positions would be eliminated, he said.

The second option, taking a 5 percent reduction from all units in the university, would save about $1.7 million, but it would have serious consequences for the academic side of operations, which largely has been left alone so far, Hall said. This option could mean layoffs, he said.

Hall said he is leaning toward the first option, but no final decisions will be made until he has more information from the government.

The UVI board has approved a tuition increase to take effect in the fall, but it will bring in only about $303,000, not nearly enough to cover the $1.4 million budget shortfall.

In leaked faculty and staff memos, and in public at last week's UVI board meeting, Hall has said that the university may not have the money to restore the 8 percent salary cuts.

In 2011, the Senate passed, and the governor signed, the Economic Stability Act, which included 8 percent pay cut for all government employes. The pay cuts took effect July 28, 2011, but they expire on July 3 of this year.

Hall said Thursday that the university may have funds to restore the 8 percent pay cuts in July, but the reinstatement would last only until September.

He said the Senate appropriated $400,000 specifically for the restoration of the pay cuts for FY 2013, but instead of releasing that money, the Office of Management and Budget is seeking a 5 percent budget cut.

"I would be misleading you if I sat here and said the 8 percent is coming," Hall said Thursday. "I hope it does."

Hall acknowledged that not restoring the salaries creates serious financial, morale, retention and recruitment challenges.

The government took the savings from the 8 percent cut away from UVI, and the only way UVI can restore it is for the government to give the money back, Hall said.

"The only way we can do it on our budget is through layoffs," Hall said.

Hall promised the staff and faculty that he would provide an update after he meets with the governor next week.

- Contact reporter Aldeth Lewin at 714-9111 or email alewin@dailynews.vi.

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