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University Restructuring As Part of Strategic Effort to Address Economic Climate

May 19, 2009

Bethune-Cookman Restructuring As Part of Strategic Effort to Address Economic Climate

Today, Bethune-Cookman University (B-CU) confirmed it has undertaken a restructuring as part of its strategic effort to address the ongoing economic recession.  A total of 30 employees, 4.7% of B-CU’s workforce, will be released as a result of this process. 

Because of the downturn in the economy, B-CU and many other higher education institutions have had to reduce expenses to balance expected reductions in revenue.   According to a survey of colleges and universities conducted in December 2008 by the Chronicle of Higher Education and Moody's Investors Service, more than one-third of respondents had frozen salaries or delayed salary increases, and more than half of the remainder said they had plans to do so.  A little more than 10 percent of colleges reported laying off employees, and another 26 percent were considering reductions in faculty and staff.  Additionally, more than 40 percent had frozen faculty hiring, and nearly 60 percent had frozen hiring for non-faculty positions.  

“We are experiencing the same impact as other colleges and universities due to the recession of the past year – drops in enrollment, decrease in government funding and decreasing value of endowment funds,” noted E. Dean Montgomery, B-CU’s executive vice president and chief operating officer.

The B-CU Board of Trustees has instructed the institution’s administration to formulate a strategy to reduce the University’s budget while maintaining a high level of service and academic integrity. 

“This decision is a proactive measure and imperative to maintain effective operations,” commented B-CU Board Chairman Dr. Irving Matthews.  “We are proud that over the last five years, B-CU has had clean audits which are an indication of strong financial stewardship.”

Prior to this restructuring, the University had already taken a number of steps to reduce costs such as requiring senior administrators, including the University president, to take unpaid furloughs.  Other cost-saving measures already in place include freezing hiring and salary increases for faculty and staff, ensuring that all full-time faculty are teaching full course loads, conserving energy and reducing in operating budgets across departments.   

A cost reduction committee was formed comprising a cross-section of administration, faculty and staff representation to determine additional steps the University should take.  This committee engaged the services of an independent consulting firm to assist with a thorough assessment of the University’s revenue sources and expenditures.  The firm, Hewitt Consulting, made several recommendations, including a reduction in faculty and staff positions.
Based on this general recommendation to “right-size” the University’s staffing, a separate review committee, including the University’s chief operating officer, chief academic officer and a tenured faculty member, reviewed and approved specific faculty and staff reductions, with a focus on eliminating inefficiencies.  

“While these kinds of decisions and transitions are difficult, we are confident that by making these changes Bethune-Cookman University will remain in a strong financial position through the current economic downturn,” commented Montgomery.  “It is our fiduciary responsibility to take aggressive action when needed to protect the institution from expected revenue losses.  And, it is our moral responsibility to ensure the stability and viability of the institution for future generations.”

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About Bethune Cookman University:

Founded in 1904 by Dr. Mary McLeod Bethune, Bethune-Cookman University (B-CU) today sustains her legacy of faith, scholarship and service through its relationship with the United Methodist Church and its commitment to academic excellence and civic engagement.  B-CU offers 38 degrees on its main campus and online college. Located in Daytona Beach, B-CU is one of three private, historically black colleges in the state of Florida. The institution boasts a diverse and international faculty and student body of nearly 4,000.  For more information, visit

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