Collegiate Times

Governor Tim Kaine announced yesterday about $300 million in state saving and spending reductions, including a $10.7 million reduction in Virginia Tech's budget and 19 Tech personnel layoffs.

The budget reduction report was created to address a $641 million revenue shortfall in the state's current budget period, which ends June 30, 2008.

According to a news release issued by Kaine, the shortfall is a result of a slow-down in revenues because of the weakening housing market.

"In August, it became clear that more belt-tightening would be required to balance the budget," said Kaine in the release.

Part of that "belt-tightening" will be to cut the budgets of state-funded colleges and universities.

"We have combed through the budget, looked at spending, found ways to do things more efficiently and made some tough choices about where to cut back on spending," said Kaine.

Kevin Hall, spokesperson for Kaine, said that Tech is given about $171 million annually from the section of the state budget that needs to be cut. Of that money for this year, the state is taking 6.25 percent back to help compensate for the shortfall, which totals to $10.7 million.

Larry Hincker from university relations, said that the university was given between two and three weeks to tell the state how they are going to cut that amount of money from their budget. He said that it was hard to make up a plan with any level of specific detail in that amount of time, so the university still doesn't know exactly how those reductions are going to be implemented.

"We don't yet have a hard and fast plan," said Hincker. "We have planning scenarios."

However, he said that if the university implements the budget the way that it is being hypothesized now, there will be 19 layoffs.

The budget reduction plan detailed report stated that in addition to layoffs, compensation for budget reductions at Tech will include increasing class sizes, offering fewer courses and decreasing efforts in instruction, research and outreach activities, among others. These actions will help fill vacant positions at a lower level and reduce personnel costs.

Hincker said that University President Charles Steger has stated that the budget reduction will not result in an across-the-board hiring freeze.

Hincker also said that Tech is at about 88 percent of the state funding level that the state says Tech should have.

"Now with the budget reduction, it will be even lower," Hincker said.

Hall said that the only difference in budget reductions in different state-funded universities is between those that are at or above base-adequacy and those that are below.

The budget reduction in the plan will impact approximately 100 agencies and result in the elimination of 386 positions and approximately 74 layoffs of current employees.

Kaine will propose addressing the $641 million shortfall through the use of the Revenue Stabilization Fund, which currently holds about $1.2 billion. The maximum allowable amount to take out of the Revenue Stabilization Fund is $303 million.