UofM Makes Drastic Cuts to Save University

In a letter to the community and staff, the University of Michigan President Mark Schlissel announced today measures to cut costs as the University bleeds money due to the Coronavirus shutdown in Michigan. In his letter, he wrote, "The pandemic also has threatened the financial stability and future strength of our university."

UofM Makes Drastic Cuts to Save University

In a letter to the community and staff, the University of Michigan President Mark Schlissel announced today measures to cut costs as the University bleeds money due to the Coronavirus shutdown in Michigan.

In his letter, he wrote, “The pandemic also has threatened the financial stability and future strength of our university.”

Right now with all the campuses closed, including Michigan Medicine, the anticipated losses are $400 million to $1 billion through the calendar year. The current situation has created uncertainties for virtually all revenue streams.

Credit: University of Michigan – President Mark S. Schlissel

With Michigan Medicine, they have experienced massive cuts in revenues in being unable to perform non-urgent medical procedures. As well as costs from the pandemic response at hospitals and clinics.

The University has called for drastic cost-cutting measures. Eliminating travel, conferences, and the use of consultants. There will be no salary increases, and a hiring freeze is in effect.

UofM senior management is also taking a 10% pay cut as well. Including UofM President Schlissel, who was reported in 2018 of having a salary of $850,000.

The University of Michigan is rolling out two programs to curb costs which are voluntary to their staff upon approval of their departments. Mainly for staff in non-critical operations. Staff employees could choose to get unpaid furlough during the COVID-19 pandemic or temporarily reduce their work hours. This leave could range from 60 to 120 days. Employees would file for state unemployment compensation and possibly be eligible for federal unemployment as well. The university would still fund their healthcare programs, and affected staff wouldn’t have to contribute to their health plans.

Credit: The University of Michigan – A. Alfred Taubman Biomedical Science Research Building Vivarium Expansion

Additionally, all construction projects on campus have been postponed. This includes a $19 million Alfred Taubman Biomedical Science Research expansion and an $8.9 million alumni center expansion, to name just a few.

President Schlissel wrote plans are already in the works for a gradual return to normal activity based on “strong public health guidance”. He also said that financial aid funds should be increased. As the students and their families have experienced reductions as well.


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Michigan State Students File Lawsuit Seeking Restitution For Tuition, Room And Board

Michigan State University students are demanding adequate restitution after they were sent home from campus due to the COVID-19 pandemic and forced to take online classes.

Michigan State Students File Lawsuit Seeking Restitution For Tuition, Room And Board

EAST LANSING, Mich. (WNEM) — Michigan State University students are demanding adequate restitution after they were sent home from campus due to the COVID-19 pandemic and forced to take online classes.

According to the lawsuit, students are seeking refunds from the university on a pro-rata basis.

“Despite the cancellation of live in-person instruction, the constructive eviction of students at the University for the remainder of the semester, and the cessation of all campus activities for at least the same time period, the University has not offered adequate refunds of tuition, room and board, and fees paid to cover the cost of certain on-campus services which will no longer be available to students,” states the lawsuit, filed by Milberg Phillips Grossman LLP, a member firm of the Coronavirus Litigation Task Force.

The firm said the lawsuit is its latest effort to stop universities from passing coronavirus financial losses on to students and their families.

According to the firm, it filed a similar lawsuit against Perdue University on Thursday, April 9.

“Michigan State’s decision to end classes is understandable from a public health perspective, but the University’s refund policy is unfair to students,” said Glenn Phillips, a partner at Milberg. “Students paid for an on-campus experience and received an off-campus experience for one-quarter of the academic year, which amounts to an educational bait-and-switch.”

According to the lawsuit, half of the Spring 2020 semester remained when MSU announced that all classes would be moved online and that students should vacate on-campus housing, for the remainder of the semester. It says the university charges approximately $5,250 per semester in room and board fees.

Students said MSU only offered a room and board credit worth $1,120 which is less than half the pro-rata amount.

The lawsuit also states that MSU has not offered a partial tuition refund reflecting the difference in the value of live instruction versus online learning. Michigan state tuition and fees cost $14,524 per semester and $39,830 per semester for in-state and non-Michigan freshmen, according to the lawsuit.

On Monday, April 20, a spokesperson for MSU said the university has not been served the lawsuit.

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