PORTLAND (AP) — Oregon’s only medical school and teaching hospital — Oregon Health & Science University — is imposing an immediate freeze in hiring and salaries, and expects to lay off some personnel to cope with a funding gap of more than $30 million primarily from declining investments.

Hospital President Dr. Joe Robertson said it is clear that the global financial crisis will continue for years rather than months, and OHSU is facing investment losses as well as declining revenues from reductions in elective surgery and increased demand for free care.

The unprecedented investment losses account for about 95 percent of the shortfall, estimated at between $30 million and $35 million, said spokesman Tim Kringen.

Last month Robertson warned of the financial difficulties, despite a recent $100 million gift from Nike co-founder Phil Knight and large cash reserves.

“OHSU managers responded very well to earlier calls for cost-cutting and cash conservation,” Roberts said in a statement. “Additional steps must be taken. We will leave positions open, defer expenditures and make other sacrifices with the goal of preserving vital services for Oregonians.”

The state research university has 12,400 employees, operates schools of medicine, nursing, dentistry, pharmacology, science and engineering, OHSU Hospital and Doernbecher Children’s Hospital. State revenues account for only 3 percent of its budget.

Robertson said each department will be developing a cost-cutting target within the next two weeks, including layoffs. The scope of layoffs was not immediately clear.

Besides declines in investment income, OHSU had been counting on a 6 percent increase in patient revenue, which it has enjoyed for some time, but has seen just a 1.2 percent increase this year, Kringen said.

When times get tough, people tend to put off elective surgery, and lose their health insurance, he added.

The university said all salaries of unclassified administrative staff and faculty will be frozen until further notice, there will be no bonuses or new hires without top executive approval, and executives have chosen to give up incentive pay this year. Union personnel will continue to be paid according to their contracts.

There is a hold on capital expenditures, delays in expansion of various departments, and no new spending for conferences, travel and minor equipment.

The university is expecting demands for free care to increase as the recession continues.