April 26-May 2, 2002
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Budget includes bonuses, budget cuts

By Matt Kelly

Virginia legislators gave final approval April 17 to Gov. Mark Warner’s plan to speed up bonuses for state employees this year.

Meeting in a one-day, reconvened session, the General Assembly OK’d Warner’s budget amendment moving state employee bonuses from Dec. 31 to Aug. 30. The one-time, 2.5 percent payments do not become part of base pay.

Employees will have the option of taking up to two weeks of additional leave instead of a bonus, or a combination of leave and bonus. Employees taking the leave option have from July 1, 2002 until June 30, 2003 to use the additional leave time.

The state has not worked out details of the bonus package, including a timetable for electing a choice, what combination of options will be available and whether probationary employees will be eligible. The leave option is not available to faculty members, and the distribution of faculty bonuses is left to the discretion of the University. Employees on a nine-month payroll plan will receive their bonuses in their October checks.

Bonuses & benefits

• Aug. 30, classified staff will get a 2.5 percent bonus, or two weeks paid leave, or a combination of bonus and paid leave. Faculty will get a bonus, to be determined by the University.

• All employees will be enrolled in the Virginia Sickness and Disability Plan unless they opt out. The enrollment period is October through December.

Warner’s other proposed budget amendments, including increasing funds for the Commonwealth Technology Research Fund, boosting student aid and abolishing a plan for the state to retain some interest earnings for auxiliary accounts, survived the legislative session. Firm numbers are not yet available on what these three items will mean for the University.

Legislators also agreed to put before the voters a plan for $1.1 billion in general obligation bonds to finance capital improvements for state colleges, institutions and parks. About $93 million of this money is linked to construction projects at U.Va., including new medical research, nanotechnology and Arts & Sciences buildings, and renovations to Fayerweather Hall.

Also in the special session, legislators rejected a proposal for a $5 per-ton trash dumping fee, which Nancy Rivers, director of State Governmental Relations, noted would have cost the University about $41,000 more per year in disposal costs. While it was a small amount in comparison with the University’s total budget, she said it would have forced other reductions in U.Va.’s budget had it been approved. The measure has been referred to the Senate Agricultural Committee for study before the 2003 session.

The final budget gave the Board of Visitors greater latitude in raising tuition, and the board responded by hiking in-state tuition 9 percent.

The budget calls for automatically enrolling all employees in the Virginia Sickness and Disability Plan unless they specifically opt out. About 1,900 employees at the University are affected, Rivers said. All employees hired after 1999 have automatically been enrolled in the system.

Rivers said the enrollment period will run from October through December.

The VSDP package includes disability insurance. The University’s own supplementary disability insurance plan had been through a steep fee hike and was canceled when the pool of interested employees dwindled. A short-term disability plan has been made available to employees to get them through until VSDP coverage takes effect.

The University faces a $25.4 million cut in state operating funds in the first year of the upcoming biennium and $33.3 million the second year.

Aside from the base cuts, new building maintenance money was reduced by nearly $1 million to $2.4 million. The maintenance reserve fund has been more than halved, from $13.4 million for the current biennium to $6.2 million for 2002-04.

The University’s equipment fund has been reduced from $15.2 million in the current biennium to $10.9 million in the next biennium.

The Medical Center will ultimately be allowed to keep its interest income, but not for another two years. Until then, it must turn over to the state $2.5 million or its actual interest income, whichever is less.


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