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State Department of Finance and Administration Suspends Cost of Living Raises for 2011

Jun 23, 2010

Non-classified employees at Arkansas State University will notbegin receiving on July 1 the two percent cost of living adjustment(COLA) or other raises for fiscal year 2011, according to a statementmade Thursday by Richard Weiss, director of the state of ArkansasDepartment of Finance and Administration. The two-percent cost of living adjustment was approved by ASU'sBoard of Trustees in the board's meeting on May 7. The suspension of thepay raises affects state agencies and all state-supported institutionsof higher education. Weiss' statement says that the state's officialforecast of general revenues for fiscal year 2011, which begins July 1of this year, triggered the action. "I am very disappointed in this turn of events because of theadverse effect this will have on our non-classified faculty and staff,"said Chancellor Robert L. Potts. "Classified staff will have the secondhalf of the pay plan implemented on schedule as previously approved byour Board of Trustees. "Our non-classified faculty and staff, who have been dedicatedand worked hard for the benefit of the university, also deserve to havewage and salary adjustments that at least address the reduction ofbuying power caused by inflation each year. They received no raise thisyear, and now we are being required to defer raises that have beenpromised to them beginning July 1." Chancellor Potts went on to say, "The ASU-Jonesboroadministration has every intention of following through on implementingthese promised wage and salary adjustments retroactively to July 1,2010, if and when permitted to do so by the director of the ArkansasDepartment of Finance and Administration. "To that end, we will escrow for that purpose the money that hasbeen allocated in our budget to implement these increases. We remainhopeful that the economy of Arkansas continues to improve and that theseraises can be implemented retroactively as early as possible in the newfiscal year." In a meeting of the ASU Board of Trustees, Friday, June 18, theboard approved the administration's recommendations. Board member MikeGibson of Osceola stated, "We need to do this. We've made a commitmentto our faculty and staff." According to Weiss' statement, "The pay plans will remain thesame as Fiscal Year 2010...it has been determined that the FY2011. . .cost of living adjustments (COLA) will be suspended at this time . . .[and] will not be applied to employees' June 30, 2010 salaries." Thedocument went on to say that, in addition, annual career servicerecognition payments and classified and unclassified employee meritincreases will be suspended for fiscal 2011. However, these decisions will be reconsidered if the Arkansaseconomy has improved after the first two quarters of 2011. Weiss' statement says the decision to suspend raises is inaccordance with Arkansas Code 21-5-211 and Act 688 of 2009.

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