Murray State University's homecoming weekend coming up ahead of Halloween and numerous financial changes are underway, including implementing federal Fair Labor Standards Act (FLSA) changes and the recent court decision reallocating 2% of a state appropriation back to university budgets. On Sounds Good, Matt Markgraf catches up with President Bob Davies on these topics, also what being a "Marketplace of Ideas" means for the university community and his thoughts on suggestions of a payroll tax in Murray.
Homecoming
Homecoming is coming up in the last week of October. Davies says it's an 'exciting' way to showcase to alumni and families all of the things going on at Murray State's campus.
The 2% Coming Back to Murray Statefrom Mid-Year Cuts Last Year & Other Financial Matters
Davies said the funds will go back into the university's reserve account. The total amount coming back is $960,500 dollars - "one-time money: - a mid-year recession enacted by executive order and since ruled against. The reserve account is a "rainy day fund" but also an investment opportunity and a one-time funding source.
“It is a savings account, it is a rainy day fund. But it’s also an investment type of opportunity as well. And also, very importantly, it is a one-time funding source. And so that’s also very important to be cognizant and considerate of.”
The reserves will be used to address issues in the chemistry and biology buildings that will be in the $2 million dollar range. Reserved funds may also be used for unexpected enrollment decline and other changes with regards to performance funding (if the appropriation ends up being less than expected). Davies said Murray State had not yet received the funds at the time of the recording (Tuesday).
Davies said the bulk of discussion at the university regarding budget cuts has centered on the 4.5% cuts approved by state legislature in the biennial budget. The future fiscal plan involves the state appropriated reduction of approximately $2.2 million dollars, FLSA changes of $1.3 million, permanent salary increases, increase in pension liability ($1.2-1.3 million) plus additional cost increases and restructuring that amounted to approximately $9 million.
There are also additional financial "pressure points" involving performance funding in July. With these challenges, conversations have focused on finding new ways to create revenue streams (stressed 'not tuition') and entrepreneurial activities and continue to acknowledge that state appropriation will "most likely continue to decline."
The state is also addressing a very difficult pension issue that needs to be addressed. On one hand, there's great work that needs to be done, and said at the same time there needs to be a continued investment in the state. Davies will deliver a State of the University address on these and more issues in November. He said he doesn't see the university continuing in a "cost cutting" mode but a "revenue enhancing mode."
The university has instituted a Budget Advisory Committee made up of students, faculty and staff members as an effort to understand and communicate the fiscal complexities and related issues and to bring ideas back to university leadership.
Fair Labor Standards Act Changes
Will impact about 180 to 200 employees going from "exempt" status to "non-exempt" status. He said it's primarily a change in how they will receive their paychecks - from monthly to bi-weekly. Some employees will go from 12 to 26 pay periods (in two months there are three paychecks due to holiday scheduling). Davies stressed this was not a Murray State idea, but a decision from the federal government.
It should not be considered a demotion and that job duties will not change, Davies said. It's also not a money-saving endeavor, but will incur an additional cost (estimated to be $1.3 million). This money was planned for in this year's fiscal budget.
Overtime over 40 hours will increase the wages of individuals who earn those hours, for instance admissions counselors who put in overtime at certain times a year or the alumni department organizing the homecoming event. Overtime in the past had been paid centrally and this will continue, but the responsibility will be largely on department managers in line with their budgets.
"You know we've got homecoming coming up for example. The alumni office is probably going to have to put up some extra hours and various other offices and if they need to pay overtime because that's the way it works out, that's the way it's gonna work out."
Overtime will be pre-approved by the supervisor or vice president or chair of the particular division and will be monitored by the university. Department managers will be tasked with potentially developing flexible schedules where if someone goes over three hours on a particular day to find a way for that employee to take off those three hours later in a given week.
Payroll Tax Discussions
Davies said he has had discussions with city leaders regarding this discussion. "The payroll tax does not assist us in our goals and ambitions. It does prevent challenges to us," Davies said speaking as the university leader. He said he has made this clear. He said a key asset to Murray State are the people employed at the university and thus made an effort to offer a 1% across the board raise. He said he would 'love' to offer more across the board raises and a merit pay system, but given the financial constraints there aren't resources available to do that and he is concerned that a payroll tax could shrink those efforts.
Davies said Murray Mayor Jack Rose has mentioned that this will be a 'revenue neutral' tax, so it becomes a philosophical question as to which demographic should bear the burden of the taxing responsibility. Davies said if other taxes go down as suggested, like eliminating the city sticker tax, or lower property taxes some employees who live in the city may benefit from the change. He said unless exceptions are made while $200 dollars may not seem like a lot, it could make a big difference for a student.
"As the leader of Murray State University, as the leader of one of the largest employers in the city, this does not help us in terms of recruiting and retaining high quality, high caliber faculty and staff."
"A Marketplace of Ideas"
The university haslaunched a survey and a series of forums on this theme. Davies said there is is an environment across the country with a wide ranging discussion on social issues. He said it's important to discuss race, discrimination and hate speech. Race, religion, gender, gender identity, sexual orientation, creed and other cultural issues are difficult topics for discussion and he said it's "imperative that we create an environment" and that people feel 'safe' in raising issues, having these discussions and in understanding and trying to grasp an understanding of those areas.'
"And when I say 'safe' I don't think that these discussions should be 'comfortable.' I'm not talking about comfort. I mean safe in terms of 'physical' not being attacked physically."
Davies said one should be able to ask a question without being 'castigated as an outsider' but to explore and gain an understanding of different cultures and ideas and what it means to be a diverse community that respects one another. "You don't get stronger by not facing some sort of discomfort," he said.
There needs to be an outlet for the things people absorb watching TV or reading stories online, he said. "To me, having forums or panels or speakers or art displays or book reading groups... just ways for individuals to come together and explore these ideas I think is imperative." If the element of 'safety,' the 'marketplace of ideas' 'comes crashing down,' he said.
There have so far been 19 responses on the survey, suggesting book clubs and all-campus reads to discussions of an art forum. Davies said he has identified private resources to fund some efforts. He said he is working to arrange three successful alumni for the next Presidential Lecture to come back and and address some of these issues.
