The University Senate of Michigan Technological University
PROCEDURES FOR PERIODS OF FINANCIAL
Senate Procedures 902.1.1
- Introductory Statement
- These procedures are prescriptive for circumstances of Financial
Stress at the University, from its recognition by the President
through its declaration and eventual termination by the Board of
- In approving these procedures, the President and Board of
Trustees relinquish none of their constitutional or statutory
- These procedures are intended for contingencies in which the
University is confronted with a financial shortfall due to
circumstances largely out of the control of the University,
such as an unexpected and sharp decline in enrollments, or
an unexpected failure of budgeted support from the State.
- These procedures are intended for situations requiring planned
action within a period of about one year. Contingencies that
require decisive action in a matter of weeks are covered in
the Procedures for Financial Crisis (q.v.).
- A period of time is required to implement these procedures and for
expenditures to be reduced. To enable the University to meet its
financial obligations during this period, it is incumbent on the
University to plan for periods of financial distress. Financial
contingency plans must be prepared for this eventuality.
- Titles of University administrators may change with time. Hence,
where particular administrative titles are used in these procedures, "or equivalent" is always implicit.
- At a time of a financial stress, any departures from these procedures
should be made in good faith and must be reported by the President to
the Board of Trustees and the University Senate.
- Committee Membership
Three committees are involved initially in the declaration and
management of financial stress. The function of these committees
is described below in Sections C and D.
- Financial Emergency Committee (FEC): An advisory committee
consisting of the Officers of the University Senate (President, Vice
President, and Secretary), and those members of the Senate Finance
Committee who have been appointed to that committee by the
Senate. Chaired by the President of the Senate.
- Executive Budget Council (EBC): An advisory committee consisting
of administrative officers holding these titles: the Provost and
Senior Vice President for Academic and Student Affairs, the Vice
President for Administration, the Vice President for
Governmental Relations, the Senior Vice President for Advancement
and Marketing, the Vice President for Research, and the Director of
Planning and Budgeting. Chaired by the Provost and Senior Vice
President for Academic and Student Affairs.
- Reconfiguration Committee (RC): A working advisory group consisting
of the Executive Budget Council (above), the President of Staff Council,
and the Deans of the Colleges and Schools, and three tenured faculty and
two professional staff members will be selected by the Senate with regard
to familiarity with university finances, gender, race, and unit membership.
A representative from Human Resources shall serve without vote. Chaired
by the Provost and Senior Vice President for Academic and Student Affairs.
- Declaration of Financial Stress
- The decision to initiate a state of Financial Stress rests with the
President. The procedures below will be followed when the President
determines that a financial emergency exists which may justify
declaration of a state of Financial Stress. The emergency will be an
extraordinary one threatening the University as a whole so that usual
procedures of planning, management, budgeting and cost-reduction are not
adequate to meet necessary budget reductions within the time available.
- Procedures for Declaration of a State of Financial Stress
- The President will call the Financial Emergency Committee into session.
The President will inform the
Committee of the nature and severity of
the Financial Stress and will present a timetable for sending the
President's recommendation to the Board of Control.
- The Financial Emergency Committee may confer, and comment or respond
immediately to the President. The Committee should provide a written
response to the President and the Board of Trustees indicating the
Committee's view of the Financial
Emergency Stress. The response may include
supporting documentation, and
may include recommending an independent
audit of the financial status of the University.
- The Senate President will call a meeting of the University Senate. At
that meeting, the President and other
administrative officers, and the
Financial Emergency Committee, will inform the Senate of the nature of
financial emergency. The Senate will make its recommendation on the
financial emergency expeditiously in
a proposal communicated by the
Senate President to the President and the Board of Trustees.
- A state of Financial Stress will exist upon declaration of the Board of
- Procedures for a State of Financial Stress
The procedures below will be followed when the Board of Trustees has
declared a state of Financial Stress.
- Immediately after the declaration of a state of Financial Stress, the
Executive Budget Council and two non-voting liaisons from the Financial
Emergency Committee will provide the vice presidents, vice provosts, deans, and
directors with guidelines, including deadlines, for preparing plans for
reductions of budgets. These guidelines will also be furnished to the
Financial Emergency Committee.
Guidelines may include incentives for cutting costs, such as arranging
for some portion of the budget given up
by a unit to be returned to that
area as discretionary funds.
- Vice presidents, vice provosts, deans, directors, and chairs will generate plans for
These individuals will actively and systematically seek input from
appropriate faculty, staff and students; the
existence of this input will
be documented when the plans are submitted.
Vice Presidents, vice provosts, deans, and directors must review their plans with Human
Resources (or equivalent successor
division) to ensure that they are
consistent with University policy where individual employees are affected.
The proposed plans are expected to consider the possible unequal treatment
of units. Vice provosts, deans,
and directors may expect that areas will
not be treated equally.
The proposed plans will be submitted to the Office of the Provost and Senior
Vice President for Academic and
Student Affairs. Only those plans meeting
the guidelines (D.1. above) will be forwarded to the Reconfiguration
Committee. Plans not meeting the guidelines will be returned for
- The Reconfiguration Committee will review the proposed plans and prepare
recommendations for the President following these guidelines:
- verify the adequacy and accuracy of documented employee input into the
proposed plans (see D.2. above);
- seek feasible alternatives to any plans that would result in elimination
of faculty and staff positions;
- determine that all plans are consistent with existing policies of the
- identify, create (if necessary), and evaluate plans avoiding the
termination of faculty and staff, including such
measures as temporary
furlough, reduced time appointments, severance pay for resignation, and
for early retirement, to meet the stress in the short term and
to allow orderly planning over longer periods.
- The Reconfiguration Committee will submit its recommendations to the
The recommendations may include plans submitted to the committee, unchanged
or modified. Recommendations
may also be original with the committee.
- In the event the President determines that resolving the state of Financial
Stress requires program reconfiguration
involving the removal of faculty and
staff, the President will ask the Reconfiguration Committee for
recommendations for reconfiguration.
Such recommendations for reconfiguration will be developed following these
- Consistent with the role and mission of the University, recommendations will
protect academic programs and
educational needs of students.
- The recommendations will protect the University's commitment to the principle
of tenure. Thus, elimination or reconfiguration of a program or department
is the only procedure by which tenured faculty may be removed
because of a
- The recommendations will protect the University's commitment to equal
- The recommendations will provide that the budget for salaries and wages of
the Administration's first, second,
and third echelons as a unit will be
reduced equitably with reductions in budgeted salaries and wages
- High financial priority will be given to providing at least a year
of notice to tenured faculty, and to providing six months notice to
nontenured faculty and to staff.
- Recommendations for Reconfiguration of Programs and Administrative Units
- Definition: Programs are defined as departments, degree programs, majors
or options within departments, interdepartmental degree programs, and units.
- Definition: Reconfiguration may involve one or a combination of the
following, any of which result in a loss
of position: absorption of one
or more programs unto another program; merger or consolidation of two or
more programs to form a new program; separation of a program into two or
more programs; elimination. Reconfiguration also applies to administrative
- Criteria for Consideration of Proposals for Reconfiguration
- The Reconfiguration Committee will base its
consideration of the proposed program reconfiguration on
criteria of quality, centrality, need, and cost. A list of more
specific considerations is provided below.
- Not all criteria will have equal weight nor
should proposals be evaluated on some algebraic formula
the criteria. The listing is to be considered as a reminder of
factors to be included in review
of proposals for reconfiguration.
- Criteria may have different implications in
different contexts. For example, "accreditation status" of a
program might count against a proposal for merger if the resulting
unit could not be accredited; however,
it might favor a proposal for
elimination of a unit on the verge of losing accreditation.
- Specific Criteria for Use in Evaluating Proposals for Reconfiguration
- Productivity of a program as indicated by
applicants for admission, credit hours generated, degree
scholarly publications, and service internal or external to the
- Quality of products compared with similar programs
at the University and elsewhere.
- National or international reputation of a program.
- Status of accreditation
- Conformation of the proposed reconfiguration with
national patterns of organization, to enable
and recognition of students, faculty, and staff.
- Centrality to University mission
- Necessity of a program or its products because
of external mandate, including University charter, legislative pressure,
laws, and governmental regulation.
- Effects of reconfiguration on other programs at the
- Extent of internal support available for the program.
- Whether a program is of a class that should be
present in every university, or at least in every
- Need - Present and Projected
Demand for the program, including measures such as market demand for
graduates, demand by applicants, and demand by other programs at the
- Cost of operating the program and the size of the
program relative to its contribution to the
compared with equivalent programs in peer institutions.
- Ratio of effective production to University
fiscal input to the program.
- Comparison of cost of the program to the revenue
generated by the program, including tuition,
grants, contracts, gifts,
- The University's investment in a program's
facilities that can not be redirected easily.
- Possible economies available with a merger of
programs that are similar in goals, orientation,
- Possibility of shifting fiscal support of a program, for
example to external grants or contracts , or from endowment
- Effect of the proposed reconfiguration on the
University's image and support by the public.
- Proposals for Reconfiguration of Non-Academic Unit
- When the Reconfiguration Committee submits to the President a recommendation for reconfiguration of non-academic units, an appropriate administrator will notify in writing each member of the unit that a recommendation has been made to the President.
- The President of the University Senate will similarly notify and inform the Senate.
- Within 14 calendar days of the notification, any employee of the non-academic unit may present a written petition to the Reconfiguration Committee asking it to reconsider a decision to reconfigure a unit. Such reconsideration must be based on a failure of the committee to follow established procedures, or on new information which was not available to the Reconfiguration Committee. The Reconfiguration Committee will consider all appeals expeditiously, and will reply in writing to the petitioner.
- Review of Proposals for Reconfiguration of Academic Programs: Program Review
- When the Reconfiguration Committee develops a recommendation for
reconfiguration of academic programs, it will appoint a Program Review
Committee to review each reconfiguration proposal. Each Program Review
Committee will be composed of at least four faculty and one undergraduate
or graduate student. No faculty or student from the program(s)
being reviewed nor member of the Reconfiguration Committee will serve
on any Program Review Committee.
- The Reconfiguration Committee will provide the Program Review Committee
with written description of the proposed reconfiguration and the rationale
for the proposal. This is to be a succinct charge to the Program Review
Committee and not a comprehensive document.
- Upon appointment of a Program Review Committee, the dean or director
of the program(s), or other appropriate administrator, will
notify in writing each faculty and staff member of the program(s)
that the review has begun. Students in the program(s) will
be given public notice. Such notification will inform the affected
persons of their right to present their views to the Program Review
- The President of the University Senate will similarly notify and inform
- Procedure for Program Review Committees
- The Program Review Committee will base its consideration of
the proposed program reconfiguration on the criteria of quality,
centrality, need, and cost given in D.6.c and D.6.d above.
- The Program Review Committee is encouraged to hold open meetings,
and to inform affected persons of such meetings and of the progress
of the review. A Program Review Committee is expected to keep
a written record of its proceedings, and all documents considered
in its deliberations.
- The Program Review Committee is expected to conclude its review
within 60 calendar days (excluding the period between spring commencement
and fall matriculation).
- When the Program Review Committee has decided it has sufficient
information to make a recommendation to the Reconfiguration Committee,
it will hold an open meeting to solicit responses and comments.
Before this meeting, the Committee will prepare a synopsis of
its procedures, findings, and preliminary conclusions. At least
48 hours before the meeting, the synopsis will be made available
to faculty and staff in the program being reviewed. The synopsis
will also be made available to all who attend the open meeting.
- The Program Review Committee will present to the Reconfiguration
Committee a detailed report containing a description of its procedures,
the information collected, a summary of the comments at the final
open meeting, and its findings and recommendations on the proposed
- Within 30 calendar days after the Program Review Committee submits
its report, the Provost and Senior Vice President for Academic
and Student Affairs will announce in writing the results of the
Reconfiguration Committee's consideration of the report. The announcement
will include the reasons for accepting or rejecting the recommendations
of the report.
- Within 14 calendar days of the announcement by the Provost and
Senior Vice President for Academic and Student Affairs, any faculty,
or student within the program may present a written petition to
the Reconfiguration Committee asking it to reconsider a decision
to eliminate a program. Such reconsideration must be based on
a failure of the committees to follow established procedures,
or on new information which could not have been available to the
Program Review Committee. The Reconfiguration Committee will consider
all appeals expeditiously, and will reply in writing to the petitioner.
- Recommendations from the Reconfiguration Committee will be presented to the
University Senate concurrently
with their presentation to the President.
- Hiring of new faculty or staff during a state of Financial Stress will be
limited to extraordinary circumstances (for example, replacing a recently
deceased employee) where an existing program would be otherwise seriously
- In the event the President approves reconfiguration of a program, the dean
or director of the program will
implement the reconfiguration plan and will
notify in writing each faculty and staff member of the program
Students in reconfigured academic programs will be given public notice. The
President of the
University Senate will similarly notify and inform the
- These following procedures will apply when approved program reconfiguration
involves the loss of faculty or staff
- Prompt and explicit notice to affected personnel.
- The mechanisms in place for separation or laying-off of personnel will be
followed. Such mechanisms include, for example, established university
procedures or collective bargaining agreements.
- For faculty and/or other non-union employees who are removed, special
provision will be made including, but not limited to the following:
- Every effort will be made to provide suitable placement elsewhere
in the University.
- Preferential rehiring of removed persons to fill any vacancy
for which they are qualified within the University, for a period
of three years after their removal.
- Faculty who were tenured and who are rehired as faculty
will be rehired with tenure.
- Persons who are rehired will not lose credit for previous
years of service, and will have the same fringe benefits as
current employees. Sick leave that has accrued prior to the
layoff would be reinstated.
- Faculty members removed during a state of Financial Stress will
at their request be appointed as adjunct faculty members, and
will be entitled to continuation of at least these prerogatives:
access to library, parking, computing, access to Career Center
facilities and personnel, cultural, and recreational facilities
afforded non-removed faculty; status as graduate faculty; use
of granting and contract offices. Regular full- and part-time
non-union staff who are removed will be afforded similar prerogatives.
- 4) Regular full- and part-time non-represented staff who are
removed will be entitled to continuation of at least these prerogatives:
access to library, parking, computing, access to Career Center
facilities and personnel, cultural, and recreational facilities.
- 5) All faculty and non-represented staff removed would be guaranteed
a 2-month continuation of health benefits.
- Faculty and staff who are removed are eligible to receive health
insurance at rates available to them under COBRA.
- Eligibility for employee education programs and tuition reduction
incentive programs will continue for three years after removal.
- Removal of tenured faculty must be approved by the Board of Trustees.
- A tenured faculty member who is removed during a state of Financial Stress
has a right to a hearing before
the University Academic Tenure Committee
(or its designated alternate).
- A written request for a hearing must be filed within 30 days from the date
of initial notice of removal. A copy of the request must be filed at the same
time with the Provost.
- The request for a hearing must include either or both of the following:
- A citation of the specific Financial Stress
procedure(s) which the member thinks have been violated;
A summary of information that the member thinks is
either new, or was not considered by the
Reconfiguration Committee in its
- The recommendations of the Academic Tenure Committee (or its designated
alternate) shall be made to the President through the Provost within 90 days
of receipt of the written appeal. The report shall indicate
whether or not
the Financial Stress procedures have been violated, or whether in the
the information supplied during the hearing should alter
the recommendations of the Reconfiguration
- Termination of a State of Financial Stress
- The President and the Reconfiguration Committee will monitor closely the
financial situation of the University during the state of Financial Stress.
The President of the University Senate will report the situation regularly
to the Senate.
- If the President determines that the conditions of Financial Stress no longer
exist, a recommendation for
termination will be submitted to the Board of
- A state of Financial Stress will cease to exist upon declaration of the Board
Adopted by Senate: 8 May 2002
Approved by Administration: 24 May 2002
Adopted by Senate: 14 January 2004
Approved by Administration: 22 January 2004
September 2015: Name changed from Board of Control to Board of Trustees
Copyright © 2001. Michigan Tech
All Rights Reserved - 29Nov01
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