Strategic and Budget Planning at �þ��Ƶ

February 7, 2019

To the Miami community,

�þ��Ƶ has thrived for generations because of our ability to adapt—to find new paths to excellence in a world that is always changing. The current higher education landscape presents its own set of challenges for all universities, including reduced enrollments and budgetary constraints. Miami is not immune to these forces. We have launched exciting innovations like the Boldly Creative academic initiative and our comprehensive campaign with its focus on scholarships. At my annual address in October and at Faculty Assembly earlier today, I discussed how our Strategic Plan will provide a blueprint, but that we face significant choices ahead as we navigate these accelerated changes to advance Miami. Now is the time for us to refocus our resources and invest in the future.

�þ��Ƶ is operating from a position of strength compared to most universities. Our targeted investments in high-demand and high-impact undergraduate and graduate programs—including health care, data science and entrepreneurship—will help us to thrive. Our financial stewardship is strong. We have an undisputed national reputation for academic quality, an immersive campus experience and a track record for �þ��Ƶ success. But the reality is clear that our current expenses are growing faster than our revenue; it is not sustainable. Great institutions are not immune to market volatility and disruptive change, but great institutions proactively plan and position themselves accordingly.

We have a plan to secure Miami's future, focused on three investment priorities:

We will continue to invest to retain and attract talented faculty and staff.
We will increase merit and need-based scholarships to attract top �þ��Ƶs and increase access to Miami, a focus of our comprehensive fundraising campaign.
We will identify and fund the most important academic initiatives in the strategic plan, when the Strategic Planning Steering Committee finishes its work next summer.

To generate the necessary resources to invest in our long-term growth and success, we will re-purpose some existing funds to targeted areas. I have charged divisional leadership with creating budget plans for the following (starting in the 2019–20 fiscal year):

For administrative divisions (including the President's Office), a reduction of 1.5% annually for the next five years
For auxiliary operations (including Intercollegiate Athletics), a reduction of 2% annually in general fee support for the next five years
Academic department budget reallocation of 1% initially for the next five years, allowing the provost to redirect those funds to high-demand, high-impact programs with measurable outcomes

We do not believe that these budget parameters will result in personnel reductions during the current academic year. As future plans develop, some areas will grow with new investments to advance Miami’s strategic initiatives, while others may require fewer positions. We will update these budget plans annually, based on the incoming class, and adjust our plans accordingly. Your dean, department chair, divisional vice president or manager will be communicating with you directly about plans in your particular department or division.

The �þ��Ƶ of the future will be stronger, more agile, and more responsive to the types of programs that �þ��Ƶs need, and are demanding. In December, the Board of Trustees passed a resolution asking the administration to develop a five-year budget plan to face our new reality. I am convinced that this is the responsible, forward-looking and mission-based direction for Miami to take. Our commitment to academic excellence and an unparalleled �þ��Ƶ experience will not waver.

Thank you for all that you do for Miami.

Love and Honor,

Gregory P. Crawford
President

Questions and Answers

How can we invest $50 million in the Boldly Creative initiative and then plan for cutbacks?

These five-year budget plans will not affect the Boldly Creative fund, which is a one-time investment. Those one-time investments will improve our structural budget outlook by creating self-sustaining programs and attracting new �þ��Ƶs.

Didn't we just recruit a record freshman class and give raises to faculty and staff? How can we do that and say we are facing financial difficulty?

This is simply proactive planning. Great institutions are not immune from market forces, but great institutions plan and position themselves accordingly. Like nearly all public universities, we remain dependent on tuition revenue while state financial support continues to dwindle. Our expenses are growing faster than our revenue. This is not sustainable. We are planning for changes we know are coming.

What about our fundraising campaign? Can private donations make up some of this budget shortfall?

We have seen remarkable early success from our comprehensive campaign—$291 million raised so far, and the last two years have been the most successful for private donations in Miami history. The campaign is in its early stages and resources come in over time—for example, five-year pledges and bequests. The bulk of the campaign will be targeted for recruitment scholarships—both merit and need—and for faculty to enable academic innovation.

Does this mean there will be layoffs?

We do not anticipate layoffs during the current academic year. As future plans develop, some areas will grow with new investments to advance Miami's strategic initiatives, while others may require fewer positions. We will update these budget plans annually, based on the incoming class, and adjust our plans accordingly.

�þ��Ƶ