Major cuts in the works at Fresno university ahead of projected multi-million dollar deficit

A local private university expects to cut about 4% of its full-time employees as part of a cost-cutting strategy ahead of a projected multi-million budget deficit, according to an email obtained Monday by The Fresno Bee’s Education Lab.

Fresno Pacific University informed its faculty and staff that it would reduce personnel, including possibly implementing hiring freezes and other positions through attrition.

Low student enrollment at the university is the leading factor of that deficit, according to the email from University President André Stephens. In the staff message, Stephens said he and his cabinet are “strategically considering” the measures as initial steps.

Enrollment has dropped by about 14% from 3,522 students in the fall of 2021 to 3,029 students currently, Fresno Pacific said in a statement to the Education Lab on Tuesday afternoon. University officials on Tuesday emphasized Fresno Pacific’s struggles are consistent with what other colleges and universities are seeing nationwide.

“We must be responsible and act now to address the enrollment shortfall and budget deficits,” he said in the email.

Stephens said projected revenue from student tuition was down by about $9 million this school year, leaving the university with a $7.4 million deficit.

That deficit would’ve been $13 million this year had the university not received $5.6 million in one-time dollars from the Higher Education Emergency Relief Fund.

“Without significant changes to how we recruit students, care for students, and structure our business, we face a projected deficit in the $13 million range next year,” Stephens said.

The numbers are early projections and could change, Stephens said.

Fresno Pacific has applied for $11.5 million in government funding through the Employee Retention Credit.

“Because we are not certain whether or when we will receive the ERC, we are having to plan without considering these one-time funds,” Stephens said.

FPU leadership hopes to invest in areas that can “increase long-term revenue,” such as innovative ways to recruit and retain students and “promising” programs that need more development or marketing.

“In addition to investing in growth, minimizing the deficits will require reducing the size of our current workforce,” Stephens said.

That’s why the university is looking to cut positions and stop hiring.

Employee compensation and benefits are already $1.6 million under budget, based on the information provided to Fresno Pacific employees.

Eligible faculty, not staff, will be offered a voluntary retirement incentive. The administration will then review the university’s operations and budget based on those who take early retirement. Remaining faculty positions may be eliminated depending on who and how many faculty members participate. Those cuts will be effective by June 30, the end of the fiscal year.

Faculty members are the professors on campus.

Faculty members in positions that are being cut immediately will be notified by Nov. 14; staff members in positions being cut will know by early November.

Employees who lose their job will be paid severance pay, according to the FPU Severance Policy, which isn’t public, will receive up to six months’ access to FPU’s Career Development personnel and resources; and be offered up to four mental health counseling sessions with FPU’s On-Site Counseling Program.