The President and Provost have asked all Deans and Vice Presidents to review the work of their planning units and to identify work that we are doing that is critical to our success as an academic institution and to consider every option to conserve resources or generate revenue – both in the short term to help weather the pandemic, but also with an eye to where we want to be when the pandemic is over. 

Working with unit leaders within their areas, planning unit heads developed recommendations for reductions. Leaders were instructed not to think in the context of hitting a pre-defined target or achieving across-the-board cuts, but rather to think strategically about meeting our financial challenges through strategic reductions while protecting our student experience. They were also asked to propose plans based on data. For example, changes in instructional capacity should be informed by credit hour production realities. Proposed plans have been shared with the President, Provost and Senior Vice President for Finance and Administration for review, revision and approval.

Decisions that are across the board or impact university policy, such as the development of a new interim furlough policy, are being vetted and revised through our shared governance structure.
 

During this critical time, our five senates, and numerous university committees are essential to our success. The fluidity and urgency of this situation demands that we review policies and, in some cases, develop new procedures to give us necessary flexibility. A good example of that is the development and review of an interim furlough policy, which was reviewed by President’s Cabinet and Budget Planning Council (BPC) before being finalized. BPC has also weighed in on administrative realignment plans that have university-wide reach.

Similarly, as we consider any changes to academic program offerings or academic college structures, we will engage with Faculty Senate and seek feedback through Student Senate leadership. 

At the same time, departmental-level decisions, including personnel reduction decisions, will be made at the department level in consultation with the appropriate Dean or Vice President. Decisions impacting academic units will be reviewed by the Provost prior to implementation and decisions impacting administrative units will be reviewed by the President prior to implementation.
 

The majority of the institution’s operational costs are in its employees, and we must address the largest share of our budget while we simultaneously strategically plan for the future of our great University. As such, while the actions we have taken to date are far-reaching, we want to be transparent that they will not be our final steps as we move toward the beginning of FY21. Some colleges and divisions are continuing to work through reorganization plans that required additional time and study to ensure the right decisions are made for the future of the University.

Over time, we need to reduce our staffing so that it is better aligned with our level of enrollment, and difficult decisions being made are based on many factors including the availability of work, reduced demand for programs and services, and reduced funding available.

While some impacts of the pandemic will be short term, others will carry with us for years. If we see enrollment impacts for fall, for example, those impacts will not only impact next fiscal year but the four subsequent years as that smaller class moves through the academic journey. In addition, Ohio University was already planning the use of reserves to bridge budget reductions over several years in response to changes in enrollment. If we make no changes to our expenses, our reserves simply will not be enough.

First, the President and Provost, along with all Vice Presidents and Deans, will be taking voluntary pay reductions. Second, as we explore furlough strategies, we are considering a tiered structure that would have greater impact on employees with higher salaries. 
However, balancing our budget through a total restructuring of our compensation model that introduces a salary cap is not a viable option for several reasons:

1. First and foremost, it would not save enough money to balance the budget. Across-the-board deep salary cuts to employees in the highest salary brackets would simply not save enough to balance the budget.
2. A salary cap would greatly damage our ability to recruit top talent – not just administrative managers but also top researchers, competitive faculty positions and physicians.
3. Dramatically reducing salaries would require changes to HR policy. Under our current guidelines, salaries can only be reduced through demotion or reorganizations in which we terminate one position and create a new one that is open to applicants at a lower salary.

Athletics was required to model budget reductions that reduce its institutional funding support. Athletics currently receives approximately $19.8 million annually in institutional support. Approximately $9 million is used for financial aid for student athletes. If the other $10.8 million was cut in its entirety, it would contribute only in a small way toward our financial challenges, as it represents only 1.4% of our total University budget. It would, however, have dramatic impact on our student and alumni experience – impact that would change who we are as an institution and have unseen ripple effects on institutional revenues.

Can we make cuts in athletics, yes. And we will do so. We are not, however, considering a 100% cut or the elimination of sports at this time.
 

Donors typically designate private donations to the University for a targeted purpose, be it a facility, a particular school or college, or a specific chair or program. Those funds, while extremely important to our educational mission, cannot be used to supplement the University’s operating budget.

Gifts to the university are vital to our funding structure and are used to leverage other revenue sources. But gift funds in no way lessen the importance of maintaining a strong financial base of support from the state, from tuition, and from research dollars.
 

A furlough was instituted for fiscal year 2021, which begins on July 1, 2020. This measure will be applied to all administrative, faculty and classified non bargaining employees. To minimize the impact on employees in our lower pay bands, an interim furlough policy was developed. See the FY21 Furlough website, including a listing of frequently asked questions.