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Cost-Saving Measures

Re: Cost-Saving Measures
To: All faculty and staff
June 29, 2020
 
Dear Colleagues,
 
UC Merced is experiencing an unprecedented series of challenges brought on by the COVID-19 pandemic. As we work together to address these challenges, it is critically important that we identify financial measures that can reduce costs that have limited impact on basic operations and allow resources to be directed toward our core mission of teaching, research and public service. In a message announcing the measures for campus sustainability, we set forth several steps to control our salary and benefit costs, which account for 70 percent of the campus budget. We do need, however, to control costs in all areas.
 
To ensure spending is prioritized, the following controls and restrictions on expenditures are effective immediately. Beyond these specific restrictions, departments should ensure all purchases are necessary for essential operations. Any incidental purchases should be postponed until further notice.
 
Review and Approval Requirements
 
  • All purchases and contracts of $5,000 or more will require approval from the dean or division head prior to purchase.
  • All professional services and consulting agreements of any value will require division-level or dean approval prior to purchase.
 
These restrictions apply to all expenditures, except for purchases made using extramural funds, such as those from grants and contracts.
 
Category Restrictions
 
Here are spending categories that are generally non-essential and offer an opportunity for significant cost savings. Ending all purchases in these categories would save the campus about $1.4 million per year. The following guidance and restrictions are effective immediately.
 
  • Desktop printers, ink and toner: Purchases of desktop printers cost the university more than $58,000 per year, plus $145,000 a year for ink and toner and $55,000 a year for printer paper. Reducing spending in this area can save the campus approximately $258,000 annually. To reduce unnecessary spending and increase campus sustainability, all purchase of new desktop printers, ink and toner must be approved by the division head or dean. Staff and faculty should make every effort to adopt digital means of communicating and storing documents. If printing is necessary, use a shared printing/multi-functional device.
  • Catering and events: In 2019, the university spent approximately $340,000 on catering for meetings and events. While this is normally a reasonable expenditure, catering must be considered non-essential in conditions that emphasize physical distancing and other health protections. We must collaborate to ensure funding is protected for UC Merced’s core mission. As a result, all potential expenditures for events and catering must be approved by the division head or dean.
  • Print and marketing materials: The university spends approximately $775,000 a year on print and marketing materials. While some of these expenditures are necessary to support UC Merced’s core mission, they should be made only if absolutely necessary, with preference to lower-cost digital communication and marketing. Until further notice, purchases of print and marketing materials must be approved by the division head or dean and by External Relations, which can advise on digital options.
 
Thank you for your efforts in helping UC Merced remain focused and strong during these challenging times. We’re all in this together. Be safe and be well.
 
Michael Riley, CPA
Interim Vice Chancellor and Chief Financial Officer
 
Josh Dubroff
Chief Procurement Officer