BOONE — A report by an Appalachian State University research group examined the status of faculty salaries and the allocation of university funding and found that upper- and mid-level administrative positions have been “prioritized” while faculty salaries have remained stagnant relative to institutional peers.
The report was commissioned by App State’s Faculty Senate in February to be completed by the institution’s Center for Economic Research and Policy Analysis. The report was released in March.
CERPA is comprised of a director and program directors that serve as App State professors in the Department of Economics. According to the group, CERPA maintains research programs in the areas of environment and energy, economic development and experimental economics.
Economics Department Chair and Professor Todd Cherry served as the principal author for the report, with help from CERPA Director and Economics Professor Ash Morgan. The two used data provided by the University Budget Office and Institutional Research, Assessment and Planning for the report.
The report found the following results: faculty salaries at Appalachian have declined significantly relative to institutional peers and to the cost of living; recent allocations of positions prioritize upper- and mid-level administration; recent allocations of funds — including faculty compensation — prioritize institutional support and student support; and trends in allocations reveal recent shifts in budget priorities.
App State administrators said they were unable to give comments on some areas of the report, such as the CERPA finding that allocations prioritized upper- and mid-level administrative positions. App State spokesperson Megan Hayes stated administrators wanted to talk to the authors of the study and review the report in full before commenting on the findings.
That specific report finding was one Hayes said administrators were carefully reviewing, as Business Affairs provided raw data to the authors of the report.
“Typically, when raw data is provided to those who are generating reports for or about the university, the office providing those data is presented with a draft or advance copy for review/discussion prior to public distribution,” Hayes said. “While that did not happen in this case, Business Affairs staff would still prefer to follow the custom of discussing report details with the authors before addressing them publicly.”
The group had reported that since 2009, faculty salaries have lost ground to those at peer institutions — falling from about the 75th percentile to below the average of its peers. During this time, CERPA contends that the budget allocation increased 30 percent for student support and 27 percent for institutional support since 2013, while the budget allocation increased 17 percent for academics/faculty. Since the same year, CERPA states the allocation of funds for compensation increased 37 percent for institutional support, 29 percent for student support and 21 percent for Academics/Faculty.
Supporting its claim that allocation trends show shifts in budget priorities, CERPA reported that funding for the academic budget grew faster than funding for each of the three support budgets (institutional, academic and student) from 2008 to 2013. In the most recent five-year period, the group finds that funding for each of the three support budgets grew considerably faster than funding for the academic budget.
In addition, the group stated that since 2014, the number of full-time equivalent upper- and mid-level administrative positions increased three times faster than FTE faculty positions. Among the three employment categories, faculty positions increased at the slowest rate.
CERPA stated that lack of investment from the state and budget planning and priorities — that determine the allocation of funds on campus — are the two main factors contributing to the relative decline in faculty salaries.
The N.C. Legislature has provided funds for faculty raises only two times during the past 10 years — 1.2 percent in 2013 and 1.5 percent in 2017, according to CERPA. However, it states these two raises were not enough to correct the problem. CERPA also recommends that the university should advocate for increased funding from the N.C. General Assembly, more flexibility for campus-based budget management and a more equitable funding model from the University of North Carolina system.
On Feb. 25 at a special called Faculty Senate meeting, Chancellor Sheri Everts told faculty that App State doesn’t receive an adequate amount of state funding compared with other state universities through the current funding model. In an email sent out to faculty on March 6, she explained that the model is based upon projected credit hours, and App State’s appropriation is calculated as the difference between expenses and tuition receipts.
Under a proposed funding model, the university would receive funding based on a credit completion formula and would be funded based on actual credit hours completed, Everts stated. This would also include summer hours, which have not previously been considered in App State’s funding allocation.
“These changes, once implemented, will result in an increase of Appalachian’s state appropriation of approximately $22 million over time,” Everts stated in the email.
Hayes stated that university leadership — from deans, the provost, vice chancellors, the chancellor to the Board of Governors — recognizes that providing competitive faculty salaries is not only ethical but also vital to the health of the university as a whole. She added that there have been important conversations taking place on campus this year, and the report from CERPA reflects the significance of faculty input and interest in the university budgeting process.
“It is understandable that faculty who have worked on our campus for a decade or more take this perspective,” Hayes said.
However, she said Everts is not just relying on hope.
“When I arrived at Appalachian I immediately recognized the single, most significant impact I can make here — far above and beyond the physical infrastructure changes underway — will be to achieve this change in the funding model,” Everts said to faculty earlier this month, according to Hayes. “I have been working toward this goal since day one, and I advocate for it in Raleigh, in Chapel Hill and in Boone every single day. I believe it is in our near future.”
Hayes added that for four years, Everts allocated salary increases for faculty and installed a leadership team that uses similar creative problem-solving techniques as described in the CERPA report. This includes reallocating more than $10 million in internal funds.
“Indeed, the CERPA-reported data shows a steady increase in faculty salaries since her first year as chancellor,” Hayes said. “However, as the report indicates, there is still work to do, and the provost has been charged with developing a plan to do so.”
While state allocations are not within the university’s control, CERPA states that the following decisions are within its control: budget requests and planning, reclassifying funds and reallocating budgets to achieve budget targets and individual decisions that can have large cumulative effects on budget allocations. CERPA provided the example of the recent campus decision to allow athletics to claim 25 percent of the $1.5 million in revenue from student fees.
“While the level of funding from the N.C. legislature matters a great deal, it also matters how the university chooses to allocate any funding that is on campus,” according to the report.
CERPA recommended that the university recommits to the 80th percentile goal — as stated in its strategic plan — and implement a plan to achieve it; conduct a review of support programs to identify resources and options for realigning priorities with the university’s mission; reallocate the budget to better align campus funding with the mission of the university; and to learn from other universities.
Within these recommendations, CERPA advised that the university should identify 5 percent of an annual budget reduction in administrative and support budgets for three years. The funding from these reductions was recommended to be redirect to savings for academics and faculty salaries.
Appalachian administrators are planned to discuss funding priorities for fiscal year 2019-20 during budget presentations on April 12 in the Plemmons Student Union. The schedule shows that the meeting will go from 8 a.m. to around 2 p.m., and administrators will hear financial needs from various campus departments. Hayes said for the first time in five years, the request for merit-based faculty increases will be reflected in the deans’ budgets.
“This represents an important shift in Academic Affairs budget prioritization, and one that is separate and apart from the chancellor’s advocacy for a new funding model for the university,” Hayes said.