In an alarming e-mail to the entire VCU college community, University President Michael Rao painted a "worst-case scenario" picture of what could happen in the Federal Government fails to act to prevent the sequestration cuts.
We broke down the important warnings in the e-mail Monday night on NBC12. Here is our report:
The full email can be found below:
To the VCU and VCU Health System Communities,
I write to you with great concern about sequestration, the more than $1 trillion in federal budget cuts that will take effect Friday unless Congress intervenes. These cuts threaten core missions of Virginia Commonwealth University, research universities across the country, as well as the economic vitality of the state.
I have met with federal lawmakers in Washington, D.C., to discuss sequestration and how we must work together to prevent a worst-case scenario from becoming a reality. It is important for everyone to understand the profound impacts of sequestration and have a voice in mitigating the dire consequences. For example:
The sequester significantly cuts the budgets of many federal agencies that fund research, meaning hundreds of millions fewer research dollars would be available to our nation’s universities. For VCU, it could mean a $21 million reduction by the end of September. Much of the cuts involve the National Institutes of Health, the principal source of research support to the VCU Center for Clinical and Translational Research and the VCU Massey Cancer Center, affecting our ability to conduct life-saving cancer research.
It is also possible that 100-200 positions funded by research grants could be eliminated.
Sequestration also could make it more difficult for students and families to pay tuition. The Federal Work Study program, a U.S. Department of Education initiative that helps students pay tuition by working on-campus jobs, would face substantial cuts. That means that more than 700 students at VCU could earn about 5 percent less in aid. The Supplemental Educational Opportunity Grant, a federal program that supports thousands of low-income VCU students, could be cut by almost 33 percent.
Students who apply for Stafford and PLUS loans as part of their financial aid package would likely face higher origination fees if sequestration takes effect. The sequester may furlough or close some loan providers, which could impact the ability to repay loans previously received.
In addition, sequestration would likely mean that federal tax returns would be processed more slowly, which could delay students in applying for financial aid for the summer and fall sessions.
There are other likely impacts of sequestration that we cannot yet gauge. One is so-called “pass-through money,” those federal funds that funnel through the university to other entities, such as contractors or collaborative partners. It is also very likely that steep cuts to federal defense spending would reduce state income tax levels in Virginia, making it possible that state agencies like VCU would be asked to return some funds already appropriated in the state budget.
At a time when resources for higher education around the nation are already limited, and the state and national economies remain uncertain, sequestration must be avoided. I am committed to working with partners to find a solution.
And, as VCU continues its rapid ascent as one of America’s Top 50 public research universities, with or without sequestration, we remain fully committed to implementing Quest for Distinctionand to our priorities for 2013 and beyond.
We will update you as we learn more.
President, VCU and VCU Health System