To the Members of the MIT community:
We are writing to update you on the Institute's planning process in response to the contracting economy and to the strains we anticipate it will place on our traditional revenue sources.
As outlined in last month's community letter, in anticipation of a decline in our revenues, we plan to reduce General Institute Budget (GIB) expenses by $100-150 million (i.e., 10-15% of the GIB) over the next two to three years. During the past two weeks we have met with the Academic Council and the Academic Department Heads to discuss inclusive collaborative ways to achieve our budget reduction targets. In addition, Chancellor Phil Clay and Vice Chancellor Steve Lerman have met with student leaders to brief them on the situation and solicit their input. These conversations have helped shape a process that includes both near-term and long-term plans.
We have asked the leaders of academic and administrative units to plan for fiscal year 2010 (FY'10) budget reductions totaling $50 million (i.e., 5% of the GIB). We have provided each unit with a target budget and will work with them to achieve the required reductions by July 1, 2009. The goal of this near-term process is to explore ways of optimizing the operations within each academic and administrative unit.
To meet the long-term target, future years will require additional budget reductions. This financial challenge gives us the rare opportunity to assess how we carry out MIT's mission and to consider ways to make improvements while reducing expenses. For this purpose we will launch an Institute-wide Planning Task Force that will bring together faculty, staff and students to address these goals in an integrated manner.
The Task Force will draw upon the academic planning exercise led by the Deans during the last year. Their work revealed many opportunities for collaborative activities among departments, schools and other units. The Task Force is charged to explore these opportunities and identify new ways to increase the efficiency and effectiveness of our operations. We (the provost, the chancellor, and the executive vice president and treasurer) will lead the Task Force, and a coordinating team will oversee planning groups focused on academic, administrative and student life areas.
The Task Force will also explore revenue enhancement opportunities. Given the broad range of topics under review, the Task Force will seek input from our whole community. Task Force members will be announced shortly, and will commence their work this January. The Task Force will focus on recommendations for implementation in FY'11 and FY'12, as well as identify those that could be phased-in in FY'10. The goal of this long-term process is to recommend ways to optimize the operations of the whole Institute.
We will provide the community with periodic reports from the Task Force and updates from senior Institute officers. We plan to convene the Institute's faculty, administrative and student leaders early in the spring term to discuss innovative ideas for the complex task at hand. We will also reach out to the community by reporting periodically at meetings of the faculty, the Administrative Council, the Administrative/Financial Officer group, UA/GSC and other groups.
To foster an inclusive process, we have created a website (web.mit.edu/institute/budget-planning/) that will serve as a resource in the months ahead. In addition to providing up-to-date information about the Task Force, the site will include all announcements, reports and news related to MIT's budget planning. You may also use the website to submit comments directly to the Task Force. As soon as the Task Force members are announced, we will launch new features on the website to encourage dialogue, share ideas and leverage technology's ability to bring communities together.
We have complete confidence that this opportunity to rethink how we perform our mission will stimulate the innovation and creativity that will result in a much stronger MIT.
L. Rafael Reif, Provost
Phillip L. Clay, Chancellor
Terry Stone, Executive Vice President & Treasurer