University Taking a Wait-and-See Approach to Possible Salary Increases

FAYETTEVILLE, Ark. – The University of Arkansas will carefully watch the condition of the university’s finances during the first few months of the 2012 fiscal year beginning July 1 before determining whether it will be feasible to provide salary increases.

Chancellor G. David Gearhart sent a note to faculty and staff on Wednesday, May 24, outlining the current plan for campus salaries with respect to state revenues and tuition.

Classified staff will receive a merit salary increase on June 1, prior to the start of the new fiscal year. The merit increases will come from central funds with an average 1.5 percent increase. The state-approved levels for merit increases are 0.75 percent for satisfactory performance, 1.5 percent for above average and 2.25 percent for performance exceeding standards.

The state has not authorized a cost-of-living adjustment in salary for classified staff members for the 2012 fiscal year; however, career service awards to staff will be allowed in the 2012 fiscal year.

For faculty and non-classified staff, merit salary increases have been budgeted but are being escrowed in a reserve account pending fall enrollment and the continued stability in state revenue. The reserve is budgeted to provide a merit pool that would allow an average increase of 2.5 percent. University officials expect a decision in November on whether or not the campus can award increases. If it is determined that increases are indeed possible, they will be made retroactive to the beginning of the 2012 fiscal year appointments. 

Gearhart said in his letter: “We are being cautious and conservative in this approach and following the governor’s lead in holding on non-classified pay increases for the time being. We are hopeful that we can release these budgeted funds before the end of the calendar year.

“Thank you for your understanding that we are still in difficult financial times that require conservative budgeting. Please know I am most grateful for your continued dedicated service to our university and our state,” he wrote.

The university pursued a similar plan during the 2011 fiscal year when Gov. Mike Beebe ordered that all state salaries be frozen until the level of the state’s revenues could be determined. The University of Arkansas Board of Trustees, which had approved salary increases as part of its budget, held off awarding any of the increases until the full extent of the revenues was known. In December 2010, budgeted salary increases were awarded retroactively.