End of Fiscal Year Update
Dear Faculty and Staff:
We will wrap up the fiscal year on June 30; below is a summary of how we navigated a stunningly difficult year. The aggregate financial losses for the University since the onset of COVID-19 have been considerable, including housing, dining and parking refunds to students, compounded by considerable drops in auxiliary and related sources of revenue. The total deficit being absorbed during the current fiscal year exceeds $27M, reaching well beyond the limited federal funds made available from the CARES Act, which carried specific expectations on its uses and significant restrictions.
Although we received $15.8M in federal funds, $7.9M was distributed in direct payments to students, with the additional funds utilized for indirect student support (e.g., scholarships and retaining all of our student workers through the end of the academic year). In contrast to many of our regional and national peers, we have been able to avoid furloughs or position reductions given our strong financial position over the past five years. The UofM has been able to do so by strategically managing expenses (including putting in place a hiring moratorium), establishing strategic partnerships with our community, along with implementing a range of efficiency measures. We are also actively exploring strategies to support our students financially and keep them on track academically. Additional steps on that front will be communicated shortly. We will continue to make investments needed to prepare for the return of students, faculty and staff to campus this fall, including support for our research infrastructure.
We anticipate receiving a revised state budget in the coming week. I will provide an update as soon as detailed information is available. We continue preparation for an anticipated reduction of 12% in recurring state funds. Although we have prepared a general framework for managing the pending reduction, we are forming several advisory groups to offer specific recommendations for absorbing reductions in University base funding. It is critical we continue to work together as we move into a new fiscal year.
Thank you for your dedicated work, collaborative spirit and limitless support as we continue to successfully navigate each and every challenge that emerges for our University and community.
Be safe, and stay healthy.
Dr. M. David Rudd, President