During the last 10 years, the overall square footage of space FM supports has grown by approximately 13 percent.  The additional space has also been more complicated and complex.  We haven’t been building warehouses; we’ve been putting up cutting edge space like Molecular and Cellular Biology and the Translational Research Facility.  In the not too distant future, state of the art research facilities will ring TCF Bank Stadium.

Meanwhile, the U has implemented a new budget model designed to reward good long-range decision making by Colleges and Departments.  One important piece of that model allows Colleges and Departments to keep energy savings to support their teaching and research efforts.  Historically FM applied those savings towards the bottom line which allowed us to operate in a deficit, in other words we spent more money than we were budgeted and used energy savings to cover any overages.  We no longer have that option.

On top of that there has been an overall slow down in the U.S. and Minnesota economy. Currently the state is projecting a $1.1 billion dollar deficit.  During the last session the legislature gave the U an increase of $82 million instead of the $123 million we requested.  We are thankful for those funds but know that the economy is not out of the woods yet. 

Those three challenges: taking care of more space that is increasingly complex; working with a new budget model; and dealing with an economic slowdown means FM will need to find ways to deliver services more efficiently.  I’m happy to say that our transformation efforts over the last two years have put us in good position to meet these challenges. 

I am working with our team on four projects with the goal of identifying between $6-12 million dollars of savings out of our $190 million dollar budget during the next two years.  We are calling them the Four Pillar Projects because they form the foundation of our business.  They include:

• Energy Management
• Parts & Procurement
• Operations & Maintenance
• Custodial

During my next several weekly messages, I will spend more time explaining each of the projects.  We are proactively planning in order to create choices on how to meet a potential budget shortfall.  Using this approach we can shape our response and continue to provide outstanding services to our students, faculty and staff.

Mike