Loyola University faculty preparing to restructure academic programs _lowres

Advocate file photo by JOHN MCCUSKER -- Loyola University, New Orleans.

Facing the prospect of continuing low enrollment and a budget shortfall, Loyola University announced Friday that it will offer buyouts to faculty and staff and will temporarily cut in half the amount that it contributes to the retirement funds of those employees who remain.

This is the third time in a year the university has sought to cut staff because of financial problems, and university officials warned there could be additional lean years ahead.

“While these decisions are difficult, they have been taken to keep the university fiscally whole as we rebuild our enrollment programs,” the Rev. Kevin Wildes, Loyola’s president, said in an email to school employees announcing the buyouts and reductions in retirement contributions.

About 162 of the university’s 900 full-time faculty and staff are eligible for the buyout, Associate Director of Public Affairs Mikel Pak said. To be eligible, employees must be 55 or older and have spent 10 continuous years working for the school.

Starting in January, the school also will cut its retirement contributions for the next two years, reducing the amount it pays into each employee’s retirement account from 8 percent of their salary to 4 percent.

Loyola has been grappling with enrollment issues since last year, when the university fell about 200 students short of its goal for enrolling first-year students then offered buyouts to help close its budget deficit.

The university’s administration approved buyouts for all 46 employees who applied for them last fall, cutting the school’s budget deficit of $7.5 million by about $2.4 million. To help close the rest of that gap, another 30 employees were either laid off or were told their contracts would not be renewed.

In last year’s buyouts, administration officials had initially said there would be caps on the number of employees whose applications would be accepted, and they set up a first-come, first-served system for processing the requests. That approach was criticized when it resulted in elderly employees camping out for days in the hallway near the university’s Human Resources Department to ensure they made the cut.

This year, the university will honor the requests of all the employees who apply for the buyout, Wildes said.

He characterized Loyola’s enrollment issue as part of a nationwide trend tied to declines in the number of high school graduates each year.

High school graduation numbers peaked in 2009 and have been on the decline since then, Wildes said, citing figures from the National Center for Education Statistics. The number of graduates will not reach the previous peak again until 2021, he said.

Loyola is not the only school in New Orleans facing budget issues. The University of New Orleans also has had to cut positions and is looking to eliminate degree programs in the face of drops in state funding and enrollment.

Loyola employees will be able to apply for the buyouts in the fall. The buyouts are set to go into effect in January, though faculty members will be allowed to work through the spring semester if they choose.

Wildes said the cuts come as the school is also looking at ways to increase enrollment.

“To ensure a positive future for the university, we have to move in two directions simultaneously,” he wrote. “First, we will continue our hard work to re-establish our admissions programs. At the same time, as we control our expenses, we must continue to plan strategically what Loyola will be as we move through this rebuilding process.”

Follow Jeff Adelson on Twitter, @jadelson.