December 1, 2008
To the University of Miami Community:
We are all watching the economy and trying to figure out what the current crisis means for our country, community, University, and ourselves and families.
Every day seems to bring greater financial volatility, creating uncertainty about what needs to be done and by whom. One thing is clear—we are all facing a serious challenge to the way we conduct our business and live our lives.
But even with all the concern about the future, it’s important for you to know that the University of Miami is financially secure. I tell you this not because we are in any way immune to the current economic crisis (we are not) but because if we stand on solid ground today it is due to the hard work and dedication of the University of Miami family. From our very beginning, we have learned to do more with less, and this guiding principle and our well-ingrained habits of conservative financial management serve us especially well today.
Our various sources of income remain fairly stable and again, because of our conservative fiscal spending policies, we are well positioned to weather the economic turbulence. Like many of our fellow universities, our endowment, which had seen growth due to the market gains of the previous years and record-setting fundraising, has decreased significantly in value. However, unlike many other institutions, endowment income does not make up a substantial part of our annual operating funds, and endowment spending is averaged out over several years to minimize the effects of market volatility.
While understanding that in the current economic climate both private and public funding will be under greater strain to meet growing demand, we will continue to focus on our ambitious fundraising goals and competitive pursuit of federal grants. Our past successes in both areas are a clear indication that the University of Miami is an excellent investment, and we have earned the respect and confidence needed to attract significant external funding. As the largest private employer in Miami-Dade County and a regional economic powerhouse, these dollars are reinvested into the community and generate both substantial tangible and intangible returns on investment.
Our decision to invest in UHealth and the University of Miami Hospital is a perfect example of the invaluable impact we have on our community. Today, South Florida is better served with higher quality medical care and improved access to more specialties staffed by some of the nation’s best physicians. Our investment will also translate into an enhanced learning environment for tomorrow’s doctors, nurses, physical therapists, and other health professionals and greatly expanded clinical research opportunities.
The leadership of the University, with the strong support of our Board of Trustees, is taking a number of immediate steps to protect and preserve our financial resources. We are reviewing and prioritizing each and every item in our current budget and are reducing spending where necessary and temporarily postponing projects where prudent. We also are evaluating our assets and investment strategies to respond to the evolving financial marketplace and will make adjustments as necessary.
So what are some of these immediate actions we have taken in response to the economic crisis?
We have implemented a mandatory review of all new and vacant positions. Only positions fulfilling crucial University needs that must be met during this fiscal year will be filled.
Construction and renovation projects that have not started and are not fully funded are now delayed one year pending further discussions with the Board of Trustees.
At this time in our budget planning process, we see little or no salary increases for next year so we can protect the jobs of our current employees. And we have asked departments to identify where they can reduce spending on items such as travel, mailings, office supplies, and special events.
We continue to monitor students’ access to federal financial aid and are working with them and their families to respond wherever possible to demonstrated need.
Of course, no one knows for sure how long or how deep the economic downturn will be, but our disciplined and conservative long-term planning has advantageously positioned us to meet a variety of challenges if they arise.
Now more than ever our strategic planning—both University-wide and for individual schools and colleges—must serve to guide us through this difficult period.
We may have to slow down our pace as we tighten our belts, but we remain committed to the goals of the Strategic Plan. Our priorities will continue to be to:
- admit the most-qualified students, regardless of their ability to pay;
- recruit and retain the best faculty and staff;
- increase our research productivity and delivery of health services;
- provide a safe and stimulating learning and working environment;
- serve the community with an unwavering commitment to excellence; and
- create new opportunities for making people in the communities we serve smarter, healthier, and financially secure.
Each of us can do a great deal to ensure that we not only survive but ultimately thrive as an institution and that all members of our community find ways to meet their personal needs.
To that end, now is an excellent time to ensure that you and your family stay as healthy as possible by following both preventive care to avoid illness and maintaining a high level of care and coordination for any existing or chronic medical conditions.
For UM employees, just as we are reviewing our institutional financial health, this is a good time to review your own situation in terms of your retirement investments and other benefits offered by the University. If you are facing personal difficulties, I urge you to contact our Employee Assistance Program, which can provide assistance in a variety of areas.
I also think it is vital that we, as a community of learning, become a community that values sharing with and caring for others less fortunate than ourselves. This is a University of Miami hallmark, and efforts such as the United Way campaign and countless volunteer programs, such as health fairs, can help our South Florida community through this difficult time.
Finally, I promise to keep in touch with you and provide updates regarding any further actions needed in response to a continued downturn or increased severity of the economic crisis. The ’Canes family is a creative and resourceful bunch, and I encourage all of you to look for ways the University can do its work more efficiently and in a cost-effective manner.
As always, please feel free to contact me at email@example.com with any suggestions or concerns.
We are all in this together—that’s how we’re going to see this through.