Campus Financial Situation Update - 5/5/2020
May 5, 2020
The Chancellor, along with the leadership team, is constantly evaluating how the COVID-19 pandemic will affect the long- and short-term financial planning for our campus.
Earlier today, President Schlissel shared a message referring to Michigan Medicine’s recently announced economic recovery plan. This plan, which includes organizational restructuring, postponing some construction projects and reducing personnel costs through leadership salary cuts, attrition, strict limits on hiring, suspension of the employer retirement match and reductions in force, is a necessary response to the unfortunate financial impact of responding to the coronavirus pandemic in our region. Many health systems around the country are experiencing similar stresses to their fiscal models.
In contrast, our campus is in quite a different situation and facing a very different set of circumstances from residential universities. That is not to say that we are not experiencing our own COVID-19 induced stress to the UM-Dearborn system. I, along with the leadership team, am constantly evaluating how the COVID-19 pandemic will affect the long- and short-term financial planning for our campus.
Revenue uncertainties derive in large part from student enrollment behavior, potential budget shortfalls in state appropriations, availability of testing and health interventions (therapeutics and prophylactics) and results of predictive public health and economic models. We are monitoring all these issues with close attention and factoring them into our thinking and planning.
As noted in previous communications, UM-Dearborn has no plans for reductions in force at this time. This measure would be among the last taken should we experience major budget shortfalls and difficulties.
UM-Dearborn leadership has implemented financial measures that will be in place for the remainder of fiscal year 2020:
- Leadership team salary reductions.
- Cancelling all on-campus events and meetings through August 22.
- Freezing of all reserve funds in the colleges and units for exigent senior leadership discretionary deployment.
- Freezing all travel spending and tuition reimbursement for non-UM programs.
- Reassigning staff to facilitate highest priority campus needs and to support employment continuity.
- Stopping all non-essential projects unrelated to health, life and safety.
- Reducing expenditures on utilities, general supplies, vendor services and other non-critical expenses.
We are also considering and evaluating many Fall 2020 scenarios and alternative fiscal year 2021 budget models to help mitigate financial risk while constantly ensuring student success and the health and safety of our community. This situation remains fluid and we will keep the UM-Dearborn community informed as circumstances change.
Our community has shown its mettle during this crisis. We have many reasons to remain optimistic, not least of which is that we have a thoughtful and capable leadership team working diligently to devise creative and appropriate solutions to our challenges and a dedicated, adaptive and talented faculty and staff preparing to seize the opportunity to create a new and exciting future for UM-Dearborn.
Please join us for our campus virtual Town Hall Meeting on May 12.
Together, we will get through this as a stronger, more caring and more innovative institution.
Go Blue. Go Dearborn!