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Board of Regents Policy Manual

8.5 Financial Exigency

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Anything in the Bylaws of the Board of Regents or this Policy Manual to the contrary notwithstanding, if the Board of Regents finds that a condition of financial exigency exists either at an institution, within an academic or other unit of an institution, or in the USG generally, then the layoff or termination of tenured faculty, non-tenured faculty, or other contract employees before the end of their contract term will be handled in accordance with the Financial Exigency policy set forth below.

As used herein, the term “unit” means any identifiable USG component at any level of its organization that has an annual budget for the operation of such component.

8.5.1 Definition of Financial Exigency

Financial exigency occurs when circumstances cause a shortfall in projected revenues for general operations as compared with projected expenditures over the same period, and such shortfall would have a material adverse effect on the operation of either an institution, an academic or other unit of an institution, or the USG generally. In the event of reduced appropriations, declining enrollments, or other actions or events that compel a reduction in the USG’s or an institution’s current operations budget, the Board of Regents may, in its exercise of fiscal responsibility, reduce the operation of, modify, or close one or more USG institutions. Such reductions, modifications, or closings may require the reduction of salaries, layoffs, or terminations of tenured faculty, non-tenured faculty, or other contract employees before the expiration of their contract term.

Any response to a financial exigency shall be developed with the understanding that action taken will be consistent with the basic USG mission to provide the best possible education for its students. The USG shall make reasonable efforts to ensure that students affected will be allowed to complete their programs, within the limits of budgetary constraints, at the institution or by transfer to another USG institution.

The determination of the existence and extent of a financial exigency affecting the USG, any individual institution, or an academic unit of an institution shall be the sole responsibility of the Board of Regents. However, the president of an institution, after consultation with representative faculty members, may request such a determination by the Board. A request for the declaration of a financial exigency at any level below the institution level must originate at the institution. When such determinations are made, this policy, along with approved implementing procedures, will take precedence over those applicable Board policies that govern normal operating procedures. The president of each institution shall follow implementing procedures prescribed by the Chancellor.


8.5.2 Layoffs or Terminations

The term layoff, as used in this policy, is defined as the temporary dismissal of any employee, including tenured or non-tenured faculty members or other contracted employees, before the end of their contract term. Layoffs may lead to eventual termination.

Layoffs or terminations may occur within an academic or other units of an institution without a net loss of faculty members or other personnel at the institution; that is, layoffs or terminations in some academic or other units may occur with simultaneous authorization of new positions for different duties in academic or other units depending upon the needs of such units.

The president of each institution, after consultation with faculty and staff, shall determine whether layoffs or terminations are required and which employees will be affected. This determination shall be made in accordance with the procedures established by the Chancellor, and will give primary consideration to the maintenance of a sound and balanced educational program that is consistent with the functions and responsibilities of the institution.

Faculty and other employees under contract who are laid off or terminated before the end of their contract terms for reasons of financial exigency shall, whenever possible, be notified at least ninety (90) days in advance of the date of layoff or termination. The notice of layoff or termination shall be delivered personally or by certified mail, with return receipt requested.

This notice shall include, in writing, a statement of the conditions requiring layoff or termination, a general description of procedures followed in making the decision and a statement of the employee’s right to respond, orally and in writing, to the appropriate official at the institution as to the reasons for the layoff or termination. The employee(s) shall also have the right, upon written request within twenty (20) days from the date of the final decision of the president, to apply to the Board of Regents for a review of the president’s decision in accordance with the provisions of the Bylaws of the Board.


8.5.3 Program Modification or Discontinuance in the Event of Financial Exigency

Anything in these policies to the contrary notwithstanding, if the Board of Regents finds that a condition of financial exigency exists at an institution, either within an academic or other unit of an institution or in the USG as provided in this Policy Manual, then program modifications or discontinuances recommended by the Chancellor and approved by the Board may be made at any such institution, within an academic or other unit of any such institution or the USG generally. If any such program modifications or discontinuances involve the layoff or termination of any tenured or non-tenured faculty or other contract employees before the end of their contract term, the provisions of Section 8.5.2 of this Policy Manual shall apply to any such layoffs or termination (BoR Minutes, 1991-92, pp. 114-117).


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