Mike Dunleavy

 

Gov. Mike Dunleavy and University of Alaska officials have reached an agreement that would soften the financial blow the university had expected.

Dunleavy, along with UA Board of Regents Chairman John Davies and President Jim Johnsen, signed a compact Tuesday afternoon that will cut the university by $70 million drawn out over three years. 

The $70 million cut is about half of Dunleavy’s originally proposed $135 million cut which would have been required within just one year. The university will be cut $25 million this current fiscal year, $25 million again next year and $20 million the year after that. 

Davies said he fully endorsed the plan, noting that the Board of Regents will still plan to address the possibility of consolidation into one university but the softening of the cut will allow the Regents to be more intentional with reductions over the next few years.

“It provides a clear and gradual multi-year path, glide path, to achieve the new budget stability,” Davies said, noting that the agreement provides relief in certainty moving forward. “One of the biggest problems has been the uncertainty.”

Johnsen told reporters the agreement allows the university to “pivot to the positive.”

“I think this gives us a very effective runway,” Johnsen said.

Johnsen sent an email to UA faculty directly following the announcement outlining what’s next. 

“In the immediate short term, this multi-year step down means we will not impose furloughs as originally planned, but we will continue to bring down our costs through restricted hiring, travel, and procurement,” Johnsen wrote. 

Johnsen noted the university is still consolidating licenses and contracts across the university system, scaling back facility maintenance, and possibly selling or leasing some facilities to increase income. 

“We also are consolidating administrative functions. Already in process is the redesign of Human Resources. Under consideration for the near term are Information Technology and Development,” Johnsen wrote.  “We are also looking at selected areas in Finance and University Relations. Teams comprised of administrative leaders across the system are working on these plans in conjunction with our several councils, which include representatives of UA faculty and staff governance organizations. We intend to finalize and implement these plans in phases through the coming year.”

University leadership has planned a series of workshops between Aug. 19-23 to consider consolidating academic programs considered “duplicative.” These include health, science/arts/humanities, management/business, research, engineering, education, eLearning and community campuses. 

“With input from these workshops we will develop our plan for academic restructuring at UA,” Johnsen wrote. 

Regents also approved a motion to allow Johnsen to work with faculty and other officials on developing a plan to consolidate the three separately accredited universities in Anchorage, Fairbanks and Juneau into a single accredited university. The Regents are set to discuss this option at their full board meeting Sept. 12-13 in Anchorage, with some anticipated changes due to updated funding levels. In July, the UA Board of Regents declared financial exigency allowing the administration to send layoff notices to tenured faculty and enact budget-reduction measures in a more immediate manner than they would be able to otherwise. 

“While the challenge remaining is significant, it pales in comparison to the single year $136 million cut we had anticipated,” Johnsen wrote.

The Board of Regents will be holding an audio conference public testimony listening session Sept. 9 to hear concerns and input from Alaskans on possible structural changes to the university. Interested individuals can call 866-726-0757 from 4-6 p.m. Testimony will be limited to two minutes per person.

The governor told reporters his intention was never to cause "angst" but rather to begin a conversation among Alaskans about budgetary priorities.

Dunleavy said he and his team had been working on this for some time, and the backstep on budget cuts to the university, Senior Benefits and Headstart and pre-K funding is not related to the quickly growing recall effort launched on Aug. 1.

Contact staff writer Erin McGroarty at 459-7544. Follow her on Twitter at twitter.com/FDNMPolitics.