To: OSU faculty and staff
From: Edward Feser, Provost and Executive Vice President
and Mike Green, Vice President for Finance and Administration
July 28, 2020
We are writing to inform you that the university will delay until Sept. 1, 2020, implementation of a temporary salary reduction program for academic faculty and most professional faculty. Reductions were to take effect as early as Aug. 1, as part of multiple measures enacted to address reduced revenues resulting from impacts of the COVID-19 pandemic.
The salary reduction program, which is progressive in design, is based on different revenue forecasts for Corvallis Education and General (E&G) funding. If Corvallis E&G revenue shortfalls are less than $35 million, no salary reductions for academic faculty or professional faculty will be enacted. Salary reductions for OSU academic and professional faculty throughout the state will be made effective when Corvallis E&G projected revenue shortfalls reach $35 million. When a $49 million shortfall occurs, $10.5 million in salary reductions will be implemented and at a $63 million shortfall, $21 million in salary reductions will be implemented. More details are available here.
At present, the university estimates that the FY21 Corvallis E&G Budget may suffer a budget shortfall ranging from $38 million to more than $60 million depending on enrollment and state and federal support. OSU auxiliary units, including housing and dining services, transportation services, printing and mailing services, and athletics may fall short of revenues by as much as $100 million. Financial losses at OSU-Cascades are also significant relative to the size of its budget.
However, because there is still considerable uncertainty in these estimates, we are delaying implementation of reductions for academic faculty until we know more about projected fall term enrollment; any changes in state funding that may result from an anticipated special legislative session to be held in August; and the possible adoption of another federal pandemic relief act.
Salary reductions for 43 senior OSU academic, administrative and athletics leaders—including the president, provost, vice presidents, athletics director, deans and others—went into effect July 1 and will remain in place at least for six months. The university’s senior leadership also did not participate in OSU’s 2020 raise program.
We continue to use a combination of measures to manage budget shortfalls across the university, including using fund balances; reducing capital, supplies and services spending; reducing staff in selected areas where work is not needed; and delaying hiring. In the weeks ahead, we will provide further updates on projected revenues, budget shortfalls and actions being taken in response by the university.
We understand the unease caused by the ongoing uncertainty around the impacts and implications of COVID-19 for the university’s operations and budget. Thank you for your patience as we continue to manage this crisis and for your continued focus on the university’s mission and community.
Provost and Executive Vice President
Vice President for Finance and Administration