Plans to close the University and require employees to take a furlough day or two between Christmas and New Year’s Day were deferred by President Lloyd Jacobs last month after student enrollment gains surpassed expectations.

UT will remain open over the holidays; however, as the state’s budget problems continue to be uncertain, Jacobs has asked a cost-savings committee to reconvene to renew planning for furloughs, possibly during spring break.

According to The Columbus Dispatch, the state was counting on $850 million from adding video slot machines at horse-racing tracks to fund primary, secondary and higher education, but the Ohio Supreme Court ruled the plan must be voted on in November 2010. Further complicating the problem is that Ohio also is at-risk of losing $618 million in federal stimulus money for higher education because to get the money, schools are required to maintain spending levels from past years.

“We are facing unprecedented financial challenges in the state of Ohio,” Jacobs said. “To ensure that The University of Toledo continues on its upward trajectory and avoids the more severe plight of many institutions around the country, we must be strategic and explore our options. This will probably include a furlough program after the new year.”

The cost-savings committee chaired by Bill Logie, vice president for human resources and campus safety, will meet at least every other week until the budget issue is resolved.

Faced with an $8.9 million cut in state support, The University will offset about $1.3 million of that total by mandating employee furloughs and shutting down the University from Monday, Dec. 28, through Thursday, Dec. 31, with the institution’s regular holiday schedule picking back up on Friday, Jan. 1.

Most employees will have one or two unpaid furlough days and will be required to take them Monday, Dec. 28, and Tuesday, Dec. 29. During the other two days that the University is closed that week, employees can use vacation, personal days, comp time or choose to go unpaid.

“The advantage of furloughs is that they help minimize the need for employee layoffs and position the University to recover more quickly when the need for cost-saving measures have diminished,” said UT President Lloyd Jacobs. “Having the furloughs during the holidays is also advantageous because it minimizes the impact on students, and it allows us to turn down the heat and capitalize on energy savings.”

The primary guiding principle of UT’s furlough program is that all benefit-eligible employees will participate, therefore minimizing the impact on any particular employee classifications.

“We must still negotiate the furloughs or the impact of the furloughs with the various unions, but it is our intention that everyone participates,” Jacobs said. “This is a very challenging time economically and we need everyone to be a part of the solution.”

For non-bargained for employees, the furlough program is as follows:

Because furlough days are unpaid, employees’ pay will be reduced by the number of furlough days during that pay period. All Health Science Campus employees and Main Campus hourly employees will see less gross pay in their Jan. 15 checks, and Main Campus salary employees will notice it in their Jan. 1 checks.

The state of Ohio has given all boards of trustees at state institutions the authority to require “mandatory furloughs of employees to achieve spending reductions necessitated by institutional budget deficits.”

UT’s Board of Trustees Finance Committee voted Aug. 24 to recommend approval of a budget amendment, including furloughs, allowing the University to again balance its budget. The full board will consider the amendment Monday, Sept. 21.

Why furloughs?

Furloughs are a temporary, required period of time off for employees without pay used to save organizations money. Like many universities and government bodies around the country, The University of Toledo plans to use furloughs as one method to help balance its budget.

The state of Ohio has given all boards of trustees at state institutions the authority to require “mandatory furloughs of employees to achieve spending reductions necessitated by institutional budget deficits.”

The advantage of furloughs is that they help minimize the number of employee layoffs and position the University to recover more quickly when the need for cost-saving measures has diminished. The furlough program is a strategic decision to help UT avoid the more severe plight of many other institutions around the country.

The goal of the furloughs is to save the University $1.3 million in salary and retirement contributions, plus additional money in energy savings.

Who is required to participate in the furlough program?

The primary guiding principle of UT’s furlough program is that all benefit-eligible employees will participate, therefore minimizing the impact on any particular employee classifications.

Part-time employees will have their furlough prorated based on their full-time equivalency.

The furloughs and the impact of the furloughs are being negotiated with the institution’s various unions.

For non-bargained for employees, see the chart on this page. the furlough program is as follows:

Employees who are essential during the furlough period, such as those who work in UT Medical Center, will have to take their furlough days the next calendar week no later than Jan. 8 or in lieu of holiday pay. Permission to use an alternate furlough schedule must be approved at the vice president and/or provost levels.

Exceptions will be made for individuals such as temporary employees, student employees, graduate and research assistants, medical residents, postdoctoral students and grant-funded positions. Furloughs for grant-funded positions will be prorated based on the compensation breakdown between the grant and UT.

When will the furlough program occur?

UT, excluding UT Medical Center, will be closed Monday, Dec. 28, through Thursday, Dec. 31, with the regular holiday schedule picking back up Friday, Jan. 1.

This timeframe was chosen for furloughs because students are not on campus and it is a relatively slower work period for the majority of employees. This is consistent with UT’s student-centered mission. Shutting down the University for the week also will allow the University to save money on energy costs.

Most employees will have one or two unpaid furlough days and will be required to take them Monday, Dec. 28, and Tuesday, Dec. 29. During the other two days that the University will be closed that week, employees can use vacation, personal days, comp time or choose to go unpaid. If an employee does not have any time available, the time will be unpaid. However, by communicating the timeframe of the furloughs four months in advance, it is hoped employees who are out of vacation time will be able to accrue hours if they desire to use them during the time the University is closed. All unpaid leaves of absence need approval.

Employees cannot use vacation, personal days, comp time or sick time on unpaid furlough days. A furlough is unpaid time off and that’s why it is a cost-savings to the University.

Currently, no other furlough days at UT are planned; however, in the event of further budget cuts or difficulty balancing the budget, furloughs will continue to be considered as an option.

Furlough impacts

Because furlough days are unpaid, your pay will be reduced by the number of furlough days you have during that pay period. All Health Science Campus employees and Main Campus hourly employees will see lesser gross pay in their Jan. 15 checks, and Main Campus salary employees will notice it in their Jan. 1 checks.

Despite a reduction in hours worked, the University has decided to not reduce sick and vacation time accruals for the furlough period. You will receive your standard allotment of both.

The furloughs also will not affect your eligibility for benefits. The dollar amount you pay still will be deducted from your paycheck, and the coverage you receive when you file a claim will not change.

An employee’s contribution and the employer contribution to a retirement plan are based on a percentage of earnings and will be reduced during the pay periods in which furlough hours are taken. In other words, fewer dollars will be invested.

Any garnishments based on your percentage of pay will be reduced based on your earnings in the pay period in which the furlough is taken.

Child support payments are taken out of paychecks in set amounts determined by court orders, so this dollar amount will not be reduced.

Furlough hours do not count toward hours worked for overtime purposes. It is important that no employee’s work week total more than 40 hours.

Do not work while the University is closed

Employees on furlough during the week the University is closed are not allowed to work. This includes reading or responding to e-mails, calling or responding to calls from colleagues, and being on site of your work location at any time during your furlough days. If an employee does work during his or her furlough without permission, he or she will be subject to disciplinary action up to and including termination.

If an employee must work while on furlough because of an emergency, he or she will need to reschedule a furlough prior to Jan. 8.

Questions?

For updates on the furlough program, visit www.utoledo.edu/depts/hr/furloughs.html. If you have specific questions regarding your situation, send an e-mail to furloughinfo@utoledo.edu.

Faced with an $8.9 million cut in state support, The University of Toledo Board of Trustees’ Finance Committee yesterday afternoon voted to recommend approval of a budget amendment that would allow the University to again balance its budget.

The full board will consider the amendment Monday, Sept. 21.

The budget amendment in non-hospital operations calls for savings of $1.9 million through the elimination of an undetermined number of vacant and filled positions, generation of $2 million with a 3.5 percent tuition increase in spring 2010, elimination of programs totaling $2.7 million, and a mandatory furlough program estimated to save the University $1.3 million.

Scott Scarborough, senior vice president for finance and administration, said more details on the furlough program would be shared soon; however, it is designed to include every employee. Furlough days, expected to be one or two, will be concentrated on times when students are not on campus and when hospital services are low. The furlough program must still be negotiated with the University’s unions.

Employees at University of Toledo Medical Center may have their number of paid holidays reduced, as opposed to furloughs, due to the fact the hospital never closes.

In addition to approving the budget amendment, which includes furloughs, the Finance Committee also unanimously approved a resolution authorizing a mandatory employee furlough policy and authorizing the president to determine if and when mandatory employee furloughs, including faculty, are necessary.

“I believe that it is very important that every employee participate in the furlough program,” said UT President Lloyd Jacobs. “This is a very challenging time economically, and we need everyone to be a part of the solution.”

The $2.7 million in program eliminations is comprised of $850,000 for restricted and clinical teaching lines, $550,000 in unused graduate student stipends, $350,000 for an early retirement incentive program, $300,000 for a perfect attendance program on the Health Science Campus, and $250,000 for discretionary administrative bonuses. Changes at the Crossings Dining facility also will save $400,000.

The budget amendment calls for UT Medical Center to cut $1 million through a furlough/holiday reduction plan, vendor consolidations and professional services contract management.

In response to fiscally challenging times, UT has made a change in residence dining service at the Crossings.

The change will yield a savings of approximately $400,000, which contributes to a campus-wide effort to balance UT’s budget as state funding has decreased.

The dining hall in the Crossings, one of the least utilized on Main Campus, previously offered an all-you-can-eat format similar to halls in International House, Ottawa House, Parks Tower and South Dining Hall in the Student Union.

A new eaterie, iCrave Pizza at the Crossings, will open Sunday and feature pizza, sandwiches, snacks and cookies daily from 6 p.m. to midnight.

“It became apparent we had to do something after the state’s last budget came out,” said David Wahr, interim director of auxiliary enterprises.

During a town hall meeting earlier this month, President Lloyd Jacobs stated that $8 million must be trimmed from UT’s current budget to offset further funding cuts from the state of Ohio. According to Dr. Kaye Patten Wallace, vice president for student affairs, the $400,000 savings is equivalent to five full-time positions, including salary and benefits.

“Clearly, we were concerned because this change impacts our students,” Patten Wallace said. “In making this decision, we sought students’ feedback through several different methods. We’re really appreciative of the student support and understanding we received as we addressed this issue together.”

UT staff, she said, worked closely with Student Government, met with residence advisers, sent e-mails to members of the Student Dining Committee and the Resident Student Association, and discussed the situation during a “Students Speak” forum in late July.

A posting on UT’s Division of Student Affairs’ Facebook page solicited 30 responses.

“We heard two major themes,” Patten Wallace said. “If we moved from the all-you-can-eat option, there needed to be some type of dining option available at the Crossings. Students also wanted to be able to use their meal swipes.”

Access to meals later in the evening was a frequent request.

“The new venue is available from 6 at night to midnight,” Patten Wallace said. “The former dining hall at the Crossings closed at 8, so this gives students four additional hours to get a good meal.”

Students also were concerned about the seating capacity in the dining hall at Ottawa House.

“Students already thought Ottawa House was crowded around dinner time during the weekends,” Wahr noted. “We’ve added 50 seats to Ottawa’s dining hall and will look for opportunities to add more seating.”

In all, Wahr said seating capacity will increase by about 160.

Students will receive e-mails notifying them of the Crossings conversion. During fall semester, focus groups also will be conducted to gather ongoing feedback.

Patten Wallace added that the change did not eliminate Aramark employee positions or student positions within UT’s dining services.

At a town hall meeting on Thursday, UT President Lloyd Jacobs outlined a four-part budget adjustment that would call for a spring semester tuition increase, a university-wide furlough program and some layoffs.

President Lloyd Jacobs answered a question about how UT will cope with an $8 million budget deficit during the town hall meeting on Health Science Campus last week. Larry Burns, vice president for external affairs and interim vice president for equity and diversity, moderated the event.

The adjustment aims to fill the $8 million gap state cuts left in UT’s fiscal year 2010 budget trustees approved in June.

Jacobs said the decisions were tough but urged the University community not to see it as a reason to enter “survival mode.” The need to thrive is greater than ever, he said, and the proposed adjustment strategy is the best way to make sure that happens.

“The first one-quarter of that $8 million shortfall will be made up by the continued re-engineering and downsizing of the work force that unfortunately we’ve been experiencing for a year,” Jacobs said, adding it would be premature to guess at an exact number of layoffs.

The layoffs and downsizing of the work force will be balanced, Jacobs said, with a university-wide furlough program. The program, which will make up the second $2 million of the $8 million gap, is in the design phases, with details still being developed. But Jacobs said it will likely include every person in the institution on staggered days concentrated when students are not on campus.

“The balance between furloughs and layoffs is one that we have considered and debated,” Jacobs said. “Furloughs affect everyone … everybody is treated more or less the same. On the other hand, the analysis of the 7 and 15 percent scenarios that were discussed extensively during the original budget process suggest that there is still some room for work-force downsizing. Balancing those seems not only wise, but fair.”

A spring tuition increase will make up the third portion of the budget adjustment.

“There will be no tuition increase this fall,” Jacobs said. “In keeping with our promise, it doesn’t seem fair to increase tuition after students are registered. However, the plan is that there will be a tuition increase in the spring.”

Jacobs said he would recommend that the spring tuition increase be the statewide increase cap of 3.5 percent.

The final $2 million will be made up of the reorganization and elimination of some University programs. This includes, Jacobs said, the possible closure of a residence hall dining hall and doing away with the perfect attendance reward program for non-hospital portions of the institution.

“There are certain programs that don’t bring in money but are important because they are mission-driven,” Jacobs said. “As we work through these next many months, we have to take a very hard look at those to be certain that they are essential. That doesn’t automatically mean that if you’re not making money you’re going to be out the door.”

Jacobs said more specific details on all four parts of the strategy are still being worked out, and he acknowledged that the process is “tremendously painful.”

“We have always tried to do work-force downsizing in the most humane way possible,” he said, adding that a new program will try to ease the pain for those displaced by the layoffs.

It’s called UT Works and it will be rolled out soon, he said. The program will offer laid-off workers access to retraining classes, help with creating effective resumés, and priority bidding on vacant University jobs.

“This is not fun,” Jacobs said. “This is not great news, but at the same time we need to continue to recognize that at an institution like ours with the morale that we have, the commitment that we have and the belief that we have in one another, we can not only survive in these times, we can thrive. We can exemplify what it is to be an institution characterized by altruism and stewardship.”

The revised budget will be presented to the Board of Trustees Aug. 24.

The entire Town Hall Meeting can be viewed at http://video.utoledo.edu.

As the state’s biennial budget awaits Ohio Gov. Ted Strickland’s signature, University of Toledo leaders are vowing to make a fall semester tuition increase a last resort as they work to balance the institution’s budget.

As was announced in Columbus late last week, if Strickland signs the current budget, as is expected, higher education funding will be reduced and the state’s prior tuition freeze will be replaced by a 3.5 percent tuition cap.

“For the fall semester, increasing tuition will be the last item on the list we choose as we work to balance the budget,” said UT President Lloyd Jacobs.

“We’re still in the process of gathering information on our expected state subsidy from legislators, the chancellor’s office and the Board of Regents,” said Jacobs, “and we need to be sure we’re looking at the entire financial picture before we begin to make choices regarding possible UT budget amendments.”

Jacobs said they would evaluate the University’s finances throughout the rest of the year before making any decisions regarding spring semester.

With the state’s current funding level, the academic enterprise of the institution is looking at an estimated budget shortfall of $7.5 million, according to Dr. Scott Scarborough, senior vice president for finance and administration. He estimated a $1 million shortfall for the hospital.

The budget amendment process will be an abbreviated version of this year’s original budget process, Scarborough said.

“We will go back to the vice presidents and deans and ask them to identify their share of savings in the context of the University’s Strategic Plan,” he said.

Jacobs acknowledged the next few weeks could bring additional pain.

“As an institution we have been through a great deal of hardship in the last few months, and it is only fair that I say frankly that additional hardship may be on the way,” he said.

“The financial burden on our students and their families is already too high. While it will not be easy, we must remain committed to students’ success, to do more with less, and to focus on the priorities of the University.”

“This is a very good time, if we but know what to do with it,” Gov. Ted Strickland quoted Ralph Waldo Emerson during the state of the state address on Jan. 28. “We do know what to do with it. First on the list is education.”

The statement reflected much of the more than hour-long speech, which focused on education for nearly 40 minutes.

Calling upon all citizens to tighten their belts, Strickland said he was “asking all Ohioans to accept the sacrifices these times demand,” noting that there would be reductions in programs and services statewide. He revealed that next year’s budget would have $3.2 billion in spending reduction.

“We will live within our means and invest in what matters,” Strickland said.

The governor did not specifically discuss state funding for higher education, other than to announce his call for the current tuition freeze to continue in fiscal year 2010, with a cap of 3.5 percent in fiscal year 2011 at Ohio’s public universities. The announcement was symbolic of his commitment, he said, to “maintain affordable access to higher education.”

President Lloyd Jacobs spoke to a group who viewed the speech in Doermann Theater following the address, noting his belief that Strickland’s remarks “speak to his deep commitment to higher education, which is shared by the president of the Ohio senate.”

“The governor believes, as I do, that if there is any way out of our current economic mess, it is not merely bailouts that may be a short-term fix,” Jacobs said. “In the long term, the only way out of this mess is education.”

Here an audio recording of Jacobs’ comments .

University of Toledo President Lloyd Jacobs cautioned there will be tough times ahead during a town hall meeting today, but offered strong optimism for the financial future of UT.

“I am confident, in fact, I am absolutely certain that we will get out of this,” he said. “But it is imperative that we continue to think strategically.”

Jacobs said the extent to which the tough economic climate would affect UT’s pocketbook in the short term is still unknown because Ohio’s next biennial budget has yet to be compiled and completed.

A possible shortfall at the state level of $7 billion, however, almost certainly will mean more layoffs at UT, he said.

“I am deeply committed to reducing layoffs by all means necessary,” Jacobs said. “We’re working very hard to delete vacancies. It is more humanitarian to delete a vacant position than it is to delete a filled position.”

Jacobs also said the creation of small early retirement programs and an internal program for retraining those displaced for other positions at the University are under way.

When Ohio Gov. Ted Strickland announces changes to Ohio’s budget, Jacobs said he is hopeful the governor will protect the funding for higher education.

“Governor Strickland and I agree that the only long-term solution to this problem is higher education,” Jacobs said.

Jacobs will offer more insights into UT’s possible financial future Wednesday, Jan. 28, after watching a public viewing of Strickland’s state of the state address at noon in Doermann Theater on Main Campus.
Also at today’s town hall meeting, the question was asked whether Jacobs would consider donating a longevity bonus he will receive in 2011 back to the University.

He said he had considered it and offered a charge to the audience.

“If you don’t think I’m earning my salary, and I think I am, but if I’m not earning my salary, you have the right to let the board of trustees or the governor know,” he said, adding that he thinks he uses his earnings responsibly, including giving to UT.

“But what I do with that salary once I have it,” he said, “that’s between God and me.”

The next town hall meeting will be held on Thursday, Feb. 5, at 4 p.m. in Health Education Building Room 100 on Health Science Campus.

In an effort to increase the number of minority-owned businesses on the list of readily available contractors, The University of Toledo will host a discussion with Todd McGonigle, director of Ohio’s Encouraging Diversity, Growth and Equity (EDGE).

McGonigle will meet with business owners interested in learning more about the EDGE program, which helps socially and economically disadvantaged businesses secure contracts with state organizations or agencies like UT.

He will meet with interested businesses Monday, Jan. 12, in the Scott Park Auditorium on UT’s Scott Park Campus from 5 to 7 p.m. He will discuss the criteria for becoming EDGE-certified as well as the program’s benefits.

Chuck Lehnert, UT vice president for facilities and construction, said the University is fortunate to have McGonigle shed some light on the EDGE program.

“We are eager to contract with minority businesses,” Lehnert said. “Maybe he can get some businesses involved that we may have been overlooking.”

McGonigle also will take questions from the audience. A reception will precede the discussion in the Scott Park Cafeteria.

For more information or to RSVP for the event, contact Lorie Sarnes at lorie.sarnes@utoledo.edu.