LOUISVILLE, Ky. (WDRB) -- The University of Louisville will implement "targeted" employee furloughs and cut pay for top administrators and faculty members by as much as 10%, among other steps to deal with the financial fallout of the coronavirus pandemic.
"These potential actions are difficult but may be necessary to help offset the major financial impacts on the university," U of L President Neeli Bendapudi wrote in a campus-wide email on Thursday. "These short-term measures are steps we are able to take now, because of our improved financial position."
The pay cuts apply to all U of L employees earning at least $100,000 annually and extend to the university's highest paid employees, men’s basketball coach Chris Mack and football coach Scott Satterfield.Â
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Bendapudi said the university faces a $40 million shortfall in the final three months of its fiscal year, which ends June 30, because of the pandemic.
She said the sources of the shortfall are:
- U of L Health's forced cancellation of elective medical and dentistry procedures
- The cancellation of the NCAA basketball tournament
- The university's decision to charge regular tuition for the online-only summer term, instead of the higher online tuition rate
- "The refunds we will provide as a result of the COVID-19 pandemic"
Besides the pay reductions, Bendapudi said the university is planning several steps to cuts expenses:
- Freezing hiring except for "only the most critical of positions
- Asking university budget units to "practice fiscal restraint, including limiting spending on supplies, equipment, etc., to only truly essential items"
- Prohibiting international and domestic travel
- "Evaluating and likely implementing temporary changes to retirement benefits."  U of L employees get an employer contribution to their 403(b) retirement plans of 7.5% to 10% of pay. Bendapudi emphasized that health and life insurance benefits will remain unchanged. U of L spokesman John Karman said “a number of possible scenarios“ related to retirement benefits are under consideration, but he would not elaborate.Â
- Furloughs of part-time and full-time employees in "targeted areas" over "the next several weeks." Bendapudi did not specify the number or types of employees who could be furloughed.
The pay cuts will last through at least June 30, Bendapudi said. The cuts are 2% for employees earning $100,000 - $199,999; 5% for employees earning $200,000 to $299,999; and 10% employees earning at least $300,000.
"All of U of L's senior leaders" will take pay cuts, the message said, including Bendapudi, Provost Beth Boehm and Executive Vice President for Research and Innovation Kevin Gardner.
