Campus update: Budget message from President Harreld

Monday, June 8, 2020

Over the last three months, the University of Iowa and University of Iowa Health Care have taken deliberate steps to protect our students, faculty, staff, patients, and the surrounding community during this global pandemic. That has included canceling study abroad programs; moving to virtual instruction; shifting to work-from-home status; closing our residence hall system and providing refunds; canceling elective health procedures; and keeping employees in pay status through the end of the spring semester.

Since the outset of the COVID-19 crisis, the university has adhered to its values and focused on doing what is right by our faculty, staff, and students. In so doing, we created several financial challenges we must now address. As I have shared previously, since March and projected through August, the university will lose more than $70 million due to the pandemic. In addition, UI Health Care is facing losses of more than $100 million during the same time period. While federal funding will help, it is far short of what is needed to make the university whole. As a result, many collegiate and central service unit leaders across the university will be forced to make difficult decisions, some of which will impact employees.

Guiding principles

The impact from the pandemic will be different for each area, so it is important that these budget decisions be made at a local level. Our campus leaders are guided by the following principles:

  • Preserving the core values of the institution (excellence, learning, community, diversity, integrity, respect, and responsibility)
  • Protecting the core activities of the university to ensure delivery of the mission
  • Engaging shared governance

Budget process

The UI’s budget process empowers the colleges and central service units to determine annual budgets based upon their projected revenue. Each area of campus will work to understand potential changes in enrollment and other factors affecting their finances to make budget decisions based on their own projections and circumstances. Contract extensions and new hires will follow the university’s regular processes based on the academic and research needs of the employing college/unit. UI Health Care will issue more specific guidelines for its employees in the coming weeks.

Some areas, particularly our self-sustaining units such as athletics and housing and dining that face steeper losses, continue reviewing budget and enrollment projections to determine appropriate staffing levels. If meaningful work is not available, employees are asked to register for the temporary redeployment pool and accept redeployment when offered, and to utilize paid vacation leave or comp time (if applicable) or request unpaid leave. In addition, supervisors may consider:

  • Hiring and salary freezes
  • Salary reductions
  • Temporary layoffs or furloughs, and
  • Permanent layoffs

Transparency and collaboration

This news understandably will create anxiety and concern within our community, but we must be forthright about the challenges we face and the difficult decisions ahead.

When the university adopted a new budget model two years ago, the goal was to increase transparency, reward collaboration, and provide predictability and stability in the face of a generational decline in state support. The same goals apply during today’s global pandemic. If we focus on our core missions of education and research, placing the success of our students and compassion for our people at the forefront of every decision, we create an opportunity to differentiate our university as a national leader.

Bruce Harreld, president