The statement which follows was prepared by the Association's Committee T on College and University Government. It was adopted by the Council of the American Association of University Professors in May 1972 and endorsed by the Fifty-eighth Annual Meeting as Association policy. In April 1990, the Council adopted several changes in language that had been approved by Committee T in order to remove gender-specific references from the original text.
I. GENERAL PRINCIPLES
The purpose of this statement is to define the role of the faculty in decisions as to the allocation of financial resources according to the principle of shared authority as set forth in the 1966 Statement on Government of Colleges and Universities,(See Note 1) and to offer some principles and derivative guidelines for faculty participation in this area. On the subject of budgeting in general, it is asserted in the Statement on Government:
The allocation of resources among competing demands is central in the formal responsibility of the governing board, in the administrative authority of the president, and in the educational function of the faculty. Each component should therefore have a voice in the determination of short- and long-range priorities, and each should receive appropriate analyses of past budgetary experience, reports on current budgets and expenditures, and short- and long-range budgetary matters should be understood by all; the allocation of authority will determine the flow of information and the scope of participation in decisions.
Essentially two requirements are set forth in this passage:
A. Clearly understood channels of communication and the accessibility of important information to those groups which have a legitimate interest in it.
B. Participation by each group (governing board, president, and faculty)(See Note 2) appropriate to the particular expertise of each. Thus the governing board is expected to husband the endowment and obtain capital and operating funds; the president is expected to maintain existing institutional resources and create new ones; the faculty is expected to establish faculty salary policies and, in its primary responsibility for the educational function of the institution, to participate also in broader budgetary matters primarily as these impinge on that function. All three groups, the Statement on Government makes clear, should participate in long-range planning.
II. FACULTY PARTICIPATION IN BUDGETING
The faculty should participate both in the preparation of the total institutional budget and (within the framework of the total budget) in decisions relevant to the further apportioning of its specific fiscal divisions (salaries, academic programs, tuition, physical plant and grounds, etc.). The soundness of resulting decisions should be enhanced if an elected representative committee of the faculty participates in deciding on the overall allocation of institutional resources and the proportion to be devoted directly to the academic program. This committee should be given access to all information that it requires to perform its task effectively, and it should have the opportunity to confer periodically with representatives of the administration and governing board. Such an institution-level body, representative of the entire faculty, can play an important part in mediating the financial needs and the demands of different groups within the faculty and can be of significant assistance to the administration in resolving impasses which may arise when a large variety of demands are made on necessarily limited resources. Such a body will also be of critical importance in representing faculty interests and interpreting the needs of the faculty to the governing board and president. The presence of faculty members on the governing board itself may, particularly in smaller institutions, constitute an approach that would serve somewhat the same purpose, but does not obviate the need for an all-faculty body which may wish to formulate its recommendations independent of other groups. In addition, at public institutions there are legitimate ways and means for the faculty to play a role in the submission and support of budgetary requests to the appropriate agency of government.
Budgetary decisions directly affecting those areas for which, according to the Statement on Government, the faculty has primary responsibility - curriculum, subject matter and methods of instruction, research, faculty status, and those aspects of student life which relate to the educational process - should be made in concert with the faculty. Certain kinds of expenditures related to the academic program, such as the allocation of funds for a particular aspect of library development, student projects under faculty sponsorship, or departmental equipment, will require that the decision-making process be sufficiently decentralized to permit autonomy to the various units of the faculty (departments, divisions, schools, colleges, special programs) in deciding upon the use of their allocations within the broader limits set by the governing board, president, and agencies representative of the entire faculty. In other areas, such as faculty research programs, or the total library and laboratory budget, recommendations as to the desirable funding levels for the ensuing fiscal period and decisions on the allocation of university funds within the current budget levels should be made by the university-level, all-faculty committee as well as by the faculty agencies directly concerned.(See Note 3) The question of faculty salaries, as an aspect of faculty status, is treated separately below.
Circumstances of financial exigency obviously pose special problems. At institutions experiencing major threats to their continued financial support, the faculty should be informed as early and as specifically as possible of significant impending financial difficulties. The faculty - with substantial representation from its nontenured as well as its tenured members, since it is the former who are likely to bear the brunt of any reduction - should participate at the department, college or professional school, and institution-wide levels in key decisions as to the future of the institution and of specific academic programs within the institution. The faculty, employing accepted standards of due process, should assume primary responsibility for determining the status of individual faculty members.(See Note 4) The question of possible reductions in salaries and fringe benefits is discussed in Section III below. The faculty should play a fundamental role in any decision which would change the basic character and purpose of the institution, including transformation of the institution, affiliation of part of the existing operation with another institution, or merger, with the resulting abandonment or curtailment of duplicate programs.
Before any decisions on curtailment become final, those whose work stands to be adversely affected should have full opportunity to be heard. In the event of a merger, the faculties from the two institutions should participate jointly in negotiations affecting faculty status and the academic programs at both institutions. To the extent that major budgetary considerations are involved in these decisions, the faculty should be given full and timely access to the financial information necessary to the making of an informed choice. In making decisions on whether teaching and research programs are to be curtailed, financial considerations should not be allowed to obscure the fact that instruction and research constitute the essential reason for the existence of the university. Among the various considerations, difficult and often competing, that have to be taken into account in deciding upon particular reductions, the retention of a viable academic program necessarily should come first. Particular reductions should follow considered advice from the concerned departments, or other units of academic concentration, on the short-term and long-term viability of reduced programs.
III. FACULTY PARTICIPATION IN DECISIONS RELATING TO SALARY POLICIES AND PROCEDURES
The Statement on Government asserts that "the faculty should actively participate in the determination of policies and procedures governing salary increases. Salaries, of course, are part of the total budgetary picture; and, as indicated above, the faculty should participate in the decision as to the proportion of the budget to be devoted to that purpose. However, there is also the question of the role of the faculty as a body in the determination of individual faculty salaries.
A. The Need for Clear and Open Policy
Many imagined grievances as to salary could be alleviated, and the development of a system of accountability to reduce the number of real grievances could be facilitated, if both the criteria for salary raises and the recommendatory procedure itself were (1) designed by a representative group of the faculty in concert with the administration, and (2) open and clearly understood.(See Note 5) Such accountability is not participation per se, but it provides the basis for a situation in which such participation can be more fruitful.
Once the procedures are established, the person or group who submits the initial salary recommendation (usually the department chair, alone or in conjunction with an elected executive committee of the department) should be informed of its status at each further stage of the salary-determination process. As the Statement on Government points out, the chief competence for the judgment of a colleague rests in the department, school, or program (whichever is the smallest applicable unit of faculty government within the institution), and in most cases the salary recommendation presumably derives from the judgment. The recommending officer should have the opportunity to defend that recommendation at a later stage in the event of a serious challenge to it.
B. Levels of Decision Making
Not all institutions provide for an initial salary recommendation by the department chair or the equivalent officer; the Association regards it as desirable, for the reasons already mentioned, that the recommendation normally originate at the departmental level. Further review is normally conducted by the appropriate administrative officers; they should, when they have occasion to question or inquire further regarding the departmental recommendation, solicit informed faculty advice by meeting with the department head or chair and, if feasible, the elected body of the faculty. It is also desirable that a mechanism exist for review of a salary recommendation, or of a final salary decision, by a representative elected committee of the faculty above the department level in cases involving a complaint.(See Note 6) Such a committee should have access to information on faculty salary levels. Another faculty committee, likewise at a broader level than that of the department, may be charged with the review of routine recommendations.
Of the role of the governing board in college and university government, the _Statement on Government_ says: "The governing board of an institution of higher education, while maintaining a general overview, entrusts the conduct of administration to the administrative officers, the president and the deans, and the conduct of teaching and research to the faculty. The board should undertake appropriate self-limitation." The Statement adds that "in the broadest sense of the term" the board "should pay attention to personnel policy." The thrust of these remarks is that it is inadvisable for a governing board to make decisions on individual salaries, except those of the chief administrative officers of the institution. Not only do such decisions take time which should be devoted to the board's functions of overview and long-range planning, but such decisions also are in most cases beyond the competence of the board.
When financial exigency leads to a reduction in the overall salary budget for teaching and research, the governing board, while assuming final responsibility for setting the limits imposed by the resources available to the institution, should delegate to the faculty and administration concurrently any further review of the implication of the situation for individual salaries, and the faculty should be given the opportunity to minimize the hardship to its individual members by careful examination of whatever alternatives to termination of services are feasible.
C. Fringe Benefits
The faculty should participate in the selection of fringe benefit programs and in the periodic review of those programs. It should be recognized that of these so-called fringe benefits, at least those included in Committee Z's definition of total compensation have the same standing as direct faculty salaries and are separated for tax purposes. They should be considered and dealt with in the same manner as direct payment of faculty salary.
(1) Jointly formulated by the American Council on Education, the Association of Governing Boards of Universities and Colleges, and the American Association of University Professors. See Academe 76 (May-June 1990): 45-48.
(2) The participation of students in budgetary decisions affecting student programs and student life is taken for granted in this document, but no attempt is made to define the nature of that participation here.
(3) For obvious reasons, the focus here is on funding from the resources of the institution, and not from external agencies such as private contractors or the federal government. Even in these cases, however, it may be possible in certain circumstances for the faculty to play a part in deciding further on the allocation of a particular grant to various purposes related to the project within the institution. There should be careful faculty and administrative scrutiny as to the methods by which these funds are to be employed under the particular contract.
(4) On the question of due process and appropriate terminal settlements for individual faculty members (on tenure or prior to the expiration of a term appointment) whose positions are being abolished, see Regulation 4(c) of the "Recommended Institutional Regulations on Academic Freedom and Tenure," Academe 69 (January- February 1983): 15a-20a.
(5) This section does not take into account those situations in which salaries are determined according to a step system and/or a standard salary is negotiated for each rank. The salary policy and, in effect, individual salaries are public information under such systems.
(6) See Regulation 15 of the "Recommended Institutional Regulations on Academic Freedom and Tenure."