Reductions to State Appropriations Require Temporary Salary Reductions for FY21
University System of Maryland Chancellor Jay A. Perman announced yesterday that the economic impact of COVID-19 on the Maryland economy has led to a $130 million cut to the System’s state appropriation. As a result, about $3.9 million must be cut from the Bowie State University budget for FY 2021. Because the state’s austere budget picture is expected to endure for the near future, BSU must take a number of steps, including a temporary salary reduction plan, to close the FY21 funding gap and position the university for continued budget challenges. You will recall that we projected the probability of this budget reduction at the University Budget Town Hall in July where we outlined several actions that could be used to balance our budget. The temporary salary reduction will assist in capturing $420,000 of the current deficit. The remaining $3.5 million will be addressed by eliminating vacant positions, reducing operating budgets, utilizing plant fund balances for bond payments and careful monitoring of all spending. Details of the these cost saving adjustments will be shared during an upcoming budget town hall next week.
While budget cuts are never easy for the university to absorb, we have taken great care in developing a plan that spreads the burden for employees in a tiered fashion from the highest to the lowest base-salary brackets. The Temporary Salary Reduction Plan calls for up to six furlough days to be taken between October 12, 2020 and March 19, 2021. The university will be closed for one of the salary reduction/furlough days, December 23, 2020.
The chart below outlines the general scope of the plan:
Bowie State University Temporary Salary Reduction Plan
The tiered plan for temporary salary reduction/furlough days calls for the equivalent of a day’s pay to be deducted from paychecks on the schedule outlined below. The plan is based on employees’ annual base salary, not including overloads or overtime.
|Number of Salary Reduction Days||Average % of Deduction||Pay Checks to be Deducted|
October 12, 2020, November 25, 2020, December 23, 2020, January 4, 2021, February 8, 2021 and March 3, 2021
If there is a conflict, it is suggested that the days be taken in October and December 2020.Note: University will be closed one day for Furlough, December 23, 2020.
$100,000 and above
|1.53%||October 12, 2020, December 23, 2020, February 8, 2021 and March 3, 2021|
$80,000 - $99,999
|1.15%||October 12, 2020, December 23, 2020, and February 8, 2021|
$60,000 - $79,999
|0.77%||October 12, 2020 and December 23, 2020|
$40,000 - $59,999
|0.38%||October 12, 2020|
$0 - $39,999
|0%||No Days Required|
The full plan, with implementation details, is available on the Human Resources website. Even though we must endure this fiscal setback, Bowie State University remains on sound financial footing at this time. We must continue to work together to make careful decisions regarding our use of all resources, and stay focused on our strategic goals to ensure the long-term viability of this great university.
I thank each of you for your steadfast dedication to Bowie State University.