Jan. 21, 2009 | By Gary D. Myers

NEW ORLEANS -- New Orleans Baptist Theological Seminary announced significant budget cuts during a meeting attended by the entire seminary faculty and staff Jan. 19.

Seminary President Chuck Kelley called the meeting in response to the deepening world-wide economic downturn and its effects on Southern Baptists, their churches, and the Cooperative Program.

“We learned in December that New Orleans Baptist Theological Seminary would be seriously affected as well,” Kelley said. “It appears that our total income from the Cooperative Program, tuition, gifts and investments will be more than $1 million less than we anticipated.”

Kelley announced six steps the seminary is taking to decrease expenses and weather the tough economic times.

“All of these adjustments are very difficult,” he said. “Every employee, including me, will be negatively impacted in some way.”

The budget cuts include adjustments in medical benefits; temporary salary reductions; temporary adjustments in faculty teaching loads; intentional reductions in campus energy consumption; a freeze on non-essential operating expenses; and a hiring freeze.

While the reductions were significant, no employee layoffs were announced at this time. The budget adjustments take effect Feb. 1.

“We have made our decisions in light of the same basic principle we followed in responding to the Katrina disaster. Our guiding principle is the preservation of employment necessary to accomplish our mission,” Kelley said.

The adjustments in medical benefits include a change in staff eligibility for insurance and changes in the deductibles for all faculty and those staff members who remain eligible for medical benefits.

Changes in staff eligibility for medical benefits will primarily affect student employees taking more that one class per semester and employees who have a spouse taking more than one class per semester. Kelley said those affected by this change will receive a raise of 50 cents per hour to help offset the loss of benefits. According to Kelley, Guidestone representatives will be working with affected employees to find alternative medical coverage.

Kelley said that faculty and staff members who retain coverage must now pay a higher deductible. For those with single coverage the deductible will be $250. The deductible will be $500 for family coverage.

Kelley’s plan also called for a 5 percent salary reduction for all faculty and staff members except those who lose medical coverage. The salaries of senior administrators will be reduced by 7 percent. Kelley will receive a 10 percent reduction in salary.

“Restoration of full salaries is a high priority and will be done as soon as possible,” Kelley said.

Temporary teaching load adjustments will be made for all faculty members. Kelley said three hours will be added to the base teaching load and three hours will be added to the maximum load. Kelley said the temporary increases in teaching loads will be in place for at least 18 months.

Kelley called on seminary cost centers to control energy consumption and freeze all non-essential operating expenses. These non-essential expenses, he said, include purchases, travel, professional development, etc.

Such reductions, along with the hiring freeze, should balance the budget and stem any further cuts Kelley said.

The overall meeting was followed by two smaller question-and-answer meetings, one for faculty and a second for seminary staff.

Kelley closed the informational meeting with a reminder for the seminary family.

"We have to hold the reality of the difficulty of these adjustments that we're making in one hand," Kelley said. "But as we hold these in our hand and seek to understand what we're going to do with these circumstances, we need to realize that God gave us two hands."

"I am in no way trying to minimize these decisions. I am not trying to divert your attention from the challenges," he continued. "But I must talk to you about this other hand. In this other hand, we also have the sufficiency of the grace of God."

Whenever God places challenges in one hand, He will always fills the other hand with His mercy and grace, Kelley said.

And Kelley also pointed to God's special provision for NOBTS in the past as evidence for His faithfulness.

"If there's anybody on earth that has been prepared for such a time as this, it ought to be this School of Providence and Prayer," Kelley said. "When Hurricane Katrina put the city and the seminary under water ... God was enough to see us through. He will do so in these times as well."

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With reporting by Michael McCormack