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NMC to Implement Austerity Measure by Reducing Employees’ Work Hours (June 29, 2011)

To ensure that its limited financial resources are sufficient to support student learning programs and services, the Northern Marianas College recently took steps to implement austerity measures that involve a reduction of eight hours per pay period (or a 10 percent cut of salaries).

“It should be stressed that the reduction in work hours in no way affects the quality of academic instruction at the College,” said Interim President Lorraine T. Cabrera. “The College is moving at full speed in preparation for the upcoming Fall 2011 semester and although some classes may need to be rescheduled, none will be canceled because of the new austerity measure.”

The move to reduce employees’ work hours by eight per pay period followed a series of campus-wide discussions that were facilitated through the College’s shared governance structure.

“Although it was not an easy decision to make, the austerity measures we’ve set in motion has the support our students, staff, and faculty,” said Cabrera.

The measure will be implemented July 15, 2011, and will continue until September 30, 2011, the end of the fiscal year. The eight-hour reduction will be applied every other Friday, when most NMC offices will be closed. Federally funded employees and offices at the College will be exempted from the austerity measure to comply with grant terms and conditions and approved plans.

According to Cabrera, the austerity measure was precipitated by the projected budget shortfall, which in part was due to a reduced budget allocation from the central government.

The Office of Management and Budget earlier informed Interim President Cabrera that NMC’s budget allotment for the remainder of the fiscal year would be reduced by 7.58 percent, or about $340K. Accordingly, the OMB office requested the College to “adjust expenditure rates for your activities to ensure spending is within the adjusted allocation.”

The College will determine whether the austerity plan needs to be extended during the next fiscal year, or if other austerity measures need to be implemented. Already, other cost-savings measures have been taken, including shortening the Summer semester session, reducing utility use across campus, and restricting new hires.

“We remain committed to ensuring that our financial resources continue to support our academic programs and student services and to improve institutional effectiveness,” added Cabrera. “We will continue to use our comprehensive program review processes to guide and inform our planning and budgeting decisions.”

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