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Caption: Board of Trustees Minutes - 1978
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1976] UNIVERSITY OF ILLINOIS 149 If the restoration is accomplished, we will need to amend the FY 1977 budget to increase salaries by 2 percent for some portion of the year. It was agreed in the Senate that increases would be effective for seven-twelfths of the year, and as late as yesterday evening there was discussion of increases being effective for one-half of the year as a further compromise position in the House. We will need your approval to accomplish these increases, which will be "across the board" and which, with the exception of a small number of craftsmen covered by contracts calling for retroactivity to September 1, will be effective either in December or in January depending upon final outcomes in the House. First, then, if the restoration of salary increase funds is accomplished in the General Assembly, I need your approval to allocate them within this framework. If the veto of funds in support of health professions education is overridden, we will develop an allocation plan for those funds which we will bring to you for action in January. I will mention later in these remarks a special problem related to the University of Illinois Hospital which requires some possible action regardless of the fate of the veto override. If the restoration of salary increase funds is unsuccessful, several actions need to be considered. You will recall that, after thorough consideration, you approved a budget request for FY 1978 which included salary increases averaging 8 percent plus an additional 2 percent for open-range employees. T h a t request was based upon the assumption that our faculty and staff would receive salary increases averaging 4.5 percent for FY 1977. If the restoration fails, that assumption will have been incorrect. In that event, I seek your authority today to increase our budget request now before the Illinois Board of Higher Education (IBHE) to provide sufficient funds to support salary increases averaging 10 percent plus an additional 2 percent for open-range employees. Tn opposing the restoration of funds to higher education for FY 1977 during this override session, Governor-elect Thompson has repeatedly stated that immediately upon his assumption of office he would consider supplemental appropriations measures to deal with certain critical financial problems. While the timing and effectiveness of this route are difficult to understand, if the restoration effort is unsuccessful, the route should be explored. One possible solution would be the immediate decision to impose a tuition increase effective with the academic terms beginning in January 1977, to seek gubernatorial and legislative support in January of supplemental appropriations from our income fund for FY 1977, and to use those funds for salary increases for the balance of this year. A tuition increase at an annual rate of $90 would, if imposed at midyear, provide funds sufficient to grant a 2 percent salary increase effective on or about February 1, 1977. If we are to follow that strategy, the decision must be made now due to a variety of complications related to the assessment and collection of tuition and to working out details with the Illinois State Scholarship Commission. Accordingly, I ask your advice and your directions concerning the imposition of a midyear tuition increase if the restoration of salary increase funds for FY 1977 is unsuccessful. Finally, with regard to the restoration effort and to Governor-elect Thompson's statements about supplemental appropriations, if the restoration is unsuccessful, I seek your approval to explore and to pursue any strategies through which general revenue funds in support of salary increases for FY 1977 might be secured through the supplemental appropriations route. I need to discuss one other item with you which may require immediate attention. Through a combination of factors, the University of Illinois Hospital is in a serious cash position. We are one of the few hospitals which will still admit patients without some guarantee of ability to pay charges above and beyond the payments made by public aid, Medicare, or third-party payers. None of these sources pays the full cost of hospital care because their payment schedules have been "frozen" at levels which do not reflect current costs. Nor have there been increases in state support of the operation of the University Hospital — a source of
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