The University of Alaska’s Board of Regents will vote on Monday on whether to declare a financial emergency, instead of delaying such a decision until the end of the month, the university system’s president said on Friday.
Last Monday the regents put off voting on a declaration of financial exigency until July 30, in the hope that by that date, they would have more clarity on whether state lawmakers planned to restore some of the drastic cuts set in motion by Gov. Michael J. Dunleavy’s budget vetoes.
University leaders have said the impact of Dunleavy’s cuts could eventually exceed $200 million — even more than the $136 million cut this fiscal year. Declaring financial exigency would make it easier for the system to downsize rapidly, including closing programs and laying off tenured faculty members.
How a governor’s vetoes fostered a financial crisis on the campuses of the Last Frontier.
James R. Johnsen, the Alaska system’s president, said that the regents had accelerated their timeline for voting on financial exigency in light of a recent decision by Moody’s Investors Service to downgrade the university’s credit rating by three notches.
“This makes bonding or borrowing money substantially more difficult and expensive,” Johnsen said in a written statement. “Moody’s also issued a negative outlook citing the ‘unprecedented’ budget reduction for the university and the Board of Regents’ decision to delay a declaration of financial exigency.”
University officials have stressed that they need to make decisions quickly about how they will downsize, and Johnsen has said they will run out of state money by February if they do nothing. Fall classes start next month.
Nick DeSantis is a senior editor for audience. Email him at nicholas.desantis@chronicle.com.
