Urbana University has laid off nine faculty and staff members and the president resigned this week, about two weeks after Franklin University acquired the smaller 164-year-old school.
The staff cuts were unfortunate but necessary in order to balance the budget at Urbana, said David Decker, Franklin’s president. Although the cuts were announced shortly after the acquisition was finalized, he said they were the result of a lengthy process to review Urbana’s financial situation.
He declined to discuss the positions that were eliminated.
“Once we reached a point where we felt we understood that pretty clearly, we didn’t see any advantage in delay,” Decker said. “The sooner we could get the university on a sound footing, the better, we thought.”
Urbana University has about 1,800 students and its economic impact on the community has been estimated at about $30 million a year.
Franklin acquired it at the end of April in an agreement that allowed the Champaign County university to remain open. But it had faced financial difficulties for years, and was facing an increasingly dire situation that threatened to close the school.
The staff cuts made this week were about equal to the personnel costs that had been added in the past 18 months, Decker said.
The cuts weren’t made based on the performance of employees, he said, but an evaluation of which roles could be filled or combined between the two entities.
Franklin University has also extended job offers to the remaining 143 full-time faculty and staff members at Urbana. Those staff members will also receive what Decker described as a modest raise of about 2 to 3 percent, the first they have received in several years.
Within the last year, Urbana stopped contributing to the retirement fund for employees. But Franklin will renew those payments, Decker said, and make up the contributions that would have been made over the previous months.
Kirk Peterson, Urbana’s president, helped lead the negotiations that allowed the school to remain open. But he resigned this week. Peterson couldn’t be reached for comment late Wednesday.
Once Peterson negotiated an agreement that kept Urbana open, he believed it was time to move on and allow Franklin to begin the transition, Decker said.
Pamela Shay, a vice president at Franklin, will replace Peterson and will serve as senior vice president for academic and student affairs at Urbana. She will report directly to Decker.
“His reason, based on his statements, was that he felt that his primary goal had been to identify some method of sustaining the university on a long-term basis, of averting the financial collapse of the university,” Decker said of Peterson.
The past two days have been difficult for faculty and staff, despite the raise, said Catherine Brinnon, an assistant professor in the College of Business. Closing the university would have devastated the community, she said, but keeping it open came at the cost of several longtime employees.
“We’ve survived,” she said. “We’ve survived at the cost of some great people.”
Despite the difficult situation, Franklin handled the cuts well Wednesday, Brinnon said.
She also thanked Peterson for his work in keeping Urbana University open.
“He has great things in store for him,” Brinnon said. “He can say that he successfully managed this partnership and gave Urbana new life. That could go on his resume quite easily.”
Although the university will remain open, she said faculty and staff were still hit hard by the loss of their coworkers.
“When reality hits, it’s devastating,” Brinnon said. “We feel like we lost friends and family. There were tears.”
In addition, Franklin is planning to make additional improvements to roads, repair roofs and make other capital improvements at Urbana, although the total investment hasn’t yet been determined.
Franklin will also spend about $175,000 to replace about 120 desktops and laptops, along with other technology investments such as wireless connectivity. Most of the computers on campus were 10 years old or more.
Staying with the story
The Springfield News-Sun first broke the news about Franklin University buying Urbana University about two weeks ago and has written several stories digging into the school’s finances.
By the numbers
9 — Faculty and staff members laid off from Urbana University as part of purchase by Franklin University
143 — Remaining Urbana faculty and staff members offered positions at Franklin
2 — Estimated percent of raise offered to remaining Urbana employees
$30 million — Estimated economic impact of Urbana University on the local economy