The University of Michigan is instituting new requirements to reduce spending as a “buffer against negative, long-term impacts on operations” stemming from federal funding cuts.
The requirements involve hiring, budgets and spending and are effective immediately.
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They were outlined in a Feb. 26 email to Ann Arbor campus faculty and staff from President Santa J. Ono and U-M’s three executive vice presidents: Provost Laurie K. McCauley, Chief Financial Officer Geoffrey S. Chatas and EVP for Medical Affairs Marschall S. Runge.
“While the university is fortunate to maintain a strong financial position, we have spent recent weeks modeling scenarios and taking prudent actions to be as prepared as possible to respond to financial events that may lie ahead,” the email said.
The actions include:
- Deans and executive officers will recommend all new hires for regular and non-student temporary employees — faculty and staff — who will then be reviewed by the president or executive vice presidents. This includes replacement and incremental positions, as well as temporary and contract staff. Outstanding job offers, made prior to Feb. 26, will be honored. Michigan Medicine teams should continue to use their existing review process.
- Non-payroll commitments exceeding $50,000 must be reviewed for a decision by the president or executive vice presidents. Units also are being asked to voluntarily review other non-essential spending, such as travel, conferences and consultants.
- Capital projects, including new buildings, renovations and other infrastructure projects, will be reexamined. Capital expenditures requiring approval by the Board of Regents will continue to be reviewed and approved by the university’s capital council. Projects currently in process will continue at this time.
The email said Michigan Medicine will be subject to separate guidance and that further communication with its faculty and staff will be forthcoming.
The actions follow a legal notice sent to U-M from a federal agency that instructed the university to stop work on a multimillion-dollar project.
“We expect this is the first of what will likely be many orders, the combined impact of which could have significant repercussions on the university’s budget,” the email said.
“While it is always difficult to contemplate potential spending cuts, your thoughtful engagement will be vital in helping us continue to fulfill our mission.”
