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April 22, 2010


Dear Colleagues:

Powerhouse. Limitless. Extraordinary.

I often use these words to describe the University of Miami. We consistently prove we can overcome challenges and surpass goals, and I recognize that our core strength comes from our 13,000-plus faculty and staff.

During these challenging economic times, we are pushing forward with our most strategic priorities, while continuing to protect our core mission, operations, and the people of the University. I am pleased and more than a little proud that we have managed our finances in ways that have allowed us to continue to improve as an institution, while minimizing layoffs and other actions that adversely affect our people.  To hold this momentum, we must continue to be smart about how we operate.  

Our overall finances are stable. Tuition revenue has continued to grow modestly, despite the smallest rate increase in our recent history. Freshman applications for the fall semester have increased 18 percent, guaranteeing that another impressive class of students will grace our campuses. Clinical care revenues at the Miller School of Medicine are up double digits for both the physician practice plan and our three hospitals.

Funding for research is increasing. We have more than $100 million of American Recovery and Reinvestment Act (ARRA) grants coming to the University. UM now ranks 14th in the nation among private research universities for ARRA funding. This is great news, but we’ll want to be careful in how we ramp up expenses that depend on ARRA funding, which by design will only be available for a brief period.

There are indications that philanthropy is on the rise—an encouraging sign in an economic environment that has had an elusive bottom.

But we are not without challenges. The decline in the stock market had a significant negative impact on our endowment and pension fund investments. Low interest rates have reduced earnings on our working capital.  

The impact of high South Florida unemployment has resulted in an increase in uninsured patients at our medical facilities. And, as you have read, our long-time partners at the Jackson Health System are dealing with financial challenges of monumental proportions that have an effect on all of South Florida, particularly the Miller School of Medicine. We are working closely with our Jackson colleagues and seeking solutions that meet the long-term needs of residents and visitors to South Florida, the Jackson Health System, and the Miller School.

I am confident in our ability to continue to move the University forward in positive ways, but only if we are diligent and aggressive in managing both revenues and expenses.

At the Board of Trustees meeting later this week, I will make several recommendations regarding compensation, benefits, and cost-savings priorities. I am pleased that my recommendations will include a 2 percent performance-based salary increase for this upcoming fiscal year and, for the second consecutive year, no increase in student and employee parking rates in UM facilities. We will continue to offer free and reduced Metrorail and Tri-Rail passes through the Public Transit Program, a program that costs the University more than $2 million per year but provides helpful relief to many of our employees.

In order to strengthen our balance sheet while continuing to offer a competitive total compensation package, we have performed extensive internal reviews and identified a number of cost-savings opportunities. Some are complex, while others require simple changes that can help make a difference. I also urge you to consider actions that you can take within your organization to conserve resources, increase efficiency, and reduce spending. Every new efficiency and cost savings makes a difference. Below are some examples of actions that are in progress:


  • Policy revision to reduce University-paid cell phones and PDAs, and moving to a taxable allowance for eligible employees

  • Streamlined Hurry ’Canes Shuttle operation

  • Continuation of university-wide energy conservation programs

  • Reduced off-site document storage

  • Tightened express delivery services

  • Creation of a UM-specific office supply catalog that includes greater use of generic brands


  • Improved vacation tracking

  • Revised overtime policy

  • Ongoing review of health plans designed to encourage wellness, increase personal accountability, and reduce costs.

We are also making some changes to benefits. We understand the value of University benefits to your total compensation. After extensive research based on a review of our aspirational peers in the Association of American Universities (AAU), the local market, and meetings with the Faculty Senate and the Employee Benefits Advisory Council, we discovered opportunities to make changes while ensuring our benefits remain competitive. We are:

  • Revising the tuition remission benefit. While we believe that UM should offer employees and their dependents the benefit of a foundational level of higher education, we also believe that employees should share responsibility for this benefit. Changes include: 

    • Employee Accountability: Employees will be required to pay in full for failed or withdrawn classes (if withdrawn after the deadline).

    • Limiting credits for employees: New credit maximum of 15 credits per calendar year—two courses per semester (including fall, spring, intersession, and summer).

    • Limiting credits for dependents: Dependents will be eligible for a lifetime maximum of 128 credits (with some program exceptions).

    • Excluding certain programs: Doctoral degrees and executive/working professional MBA scholarships will be excluded from tuition remission.

  • Changing the University-provided life insurance benefit from two times annual salary up to $200,000 to two times annual salary up to $100,000. The new policy will be implemented on a prospective basis (i.e., Current employees will not be affected by the reduced benefit. Benefit will be frozen at current amount for employees hired before June 1, 2010. No one will lose their current benefit). We will also be providing an Enhanced Voluntary Life Insurance option during a one-time open enrollment period – May 3 -17, 2010. Employees will be able to buy up to three times their annual salary to a maximum of $250,000 without a medical statement. If a medical statement is provided and accepted, a maximum of six times annual salary to $1,000,000 is available.

I am also pleased that we will again offer the Summer Flexible Work Schedule in those departments where it can be accommodated. Our intention, where possible, is to provide employees with more time for family and outside activities.

To learn more about the above benefit and policy changes, please click here.

The University is navigating this economic downturn with its commitment to excellence in teaching, research, and service intact, thanks to the dedication and hard work of the entire UM community. We still face significant challenges. We recognize how important it is to remain competitive and recruit and retain talented faculty, staff, and students, while continuing to look for ways to operate more efficiently and effectively.

Your feedback is important. You have had great suggestions this past year, and if you have any ideas about cost savings initiatives, please submit them at the Faculty and Staff Suggestion Program website.

I thank you for all that you do for this University.