The University of New Mexico

NEWS RELEASE

Media contact:  Susan McKinsey, 277-1807
 mckinsey@unm.edu

FOR IMMEDIATE RELEASE
November 4, 2008

UNM Implements Campus-Wide Savings Strategy

“Pause” in Hiring Focused on State Funded Accounts

University of New Mexico President David J. Schmidly has unveiled a short-term savings plan for the university, effective immediately, which is designed to accumulate sufficient revenue to meet a possible rescission in the FY 09 budget should one be mandated by the state.

The plan, which features a pause in non-essential hires through the end of the calendar year, was presented to UNM Regents at their Finance and Facilities Committee meeting today.

 “There is no reason to panic but every reason to be prudent by slowing the pace at which we’re spending money for the next couple of months,” said Schmidly. “Since we’re a third of the way into the fiscal year, we have to pause some spending now in order to accumulate the revenue we need should there be a mid-year budget rescission.”

The pause in spending applies only to state-appropriated Instruction and General (I&G) funds, which account for 17% of the main campus budget and 5% of the Health Sciences Center budget.  There are no plans for across-the-board reductions and the intent is to manage this savings plan without any reduction in the current workforce.

The following preemptive steps are designed to slow spending and increase savings at the university:

• An immediate pause in the hiring of all new employees whose positions are not deemed “absolutely critical.”
• An immediate suspension of future salary adjustments (reclassifications, promotions, career ladders, etc.) that have not already been approved by the Executive Vice Presidents.
• A temporary suspension of minor capital allocations and equipment purchases.
• A 10% reduction in travel expenditures.

Schmidly said the savings would be held in “budget holdback” accounts until the end of the year when state revenue forecasts will determine future action by the state.  Should there not be a budget rescission, the funds will be returned to their original accounts.

In addition to the pause in spending, the university will review its commitments to all new capital projects for which construction contracts are not already in place, no matter the source of funding for the project.
The university will also continue its review of all special and capital projects funded by the legislature.  In addition, there will be a review of all projects in UNM’s 2007 bond issuance to ensure that revenue projections are sufficient to meet bond requirements.

President Schmidly’s communication to the campus, “UNM Responds to Today’s Economic Challenges,” can be viewed on the UNM website at www.unm.edu/president. Please look under Current Items.

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