Kotlikoff thanks staff, outlines challenges in annual address

After a year of intense political pressure and financial strains, President Michael I. Kotlikoff used his annual Address to Staff on Jan. 8 to talk through "some of the tough topics we've all been dealing with" along with many of the challenges faced by Cornell.

But first, he began by expressing his appreciation for Cornell staff, who he called the "backbone of the university."

"Without you, the magic that occurs in our classrooms, in our residence and dining halls, in our libraries and laboratories and athletic facilities, and everywhere else across our campuses, would not occur," he said.

At the start of the event, Rose Howard, the Cornell Engineering and Cornell Bowers Computing and Information Science representative of the Employee Assembly, presented the assembly's 2025 Appreciation Awardto the 15-person team that worked to implement the floating holidays program.

Accepting the award on behalf of the group was Jess Reynolds, a Human Resources policy and compliance consultant and one of the group's leads.

"From introducing to implementing the floating holiday time program, it's been a meaningful initiative, and it's incredibly gratifying to see it being recognized for enhancing flexibility, inclusivity and employee well-being," Reynolds said.

In his speech, Kotlikoff described the unprecedented challenges faced by the university and its peers in higher education, particularly the "seismic impact" of disruptions to research funding. He detailed the settlement Cornell reached with the Trump administration in November, and why it was necessary.

"When we learned that we were being directly targeted by the administration with stop-work orders and non-payment of grants, something amounting to hundreds of millions of dollars, we established two goals," he said. "The first was to restore the funding that is so vital to our research labs and the faculty, staff and students working in them. The second goal was to do so in a manner that maintained the principle that Cornell is a private entity that determines its own policies, adjudicates those policies itself, decides whom to hire and whom to admit, and is bound by the law, rather than political mandates.

"It took nine months of negotiations and holding our ground," he added, "but we were able to achieve, in my view, both of those goals."

Kotlikoff urged the audience to look beyond news coverage of the settlement and read the agreement itself, which enabled the dismissal of civil rights investigations against the university, restored research funding and provided a "legal footing" that would help Cornell in any future disputes with the government.

"None of our commitments to our students, staff or faculty have changed," he said. "Our 'any person' commitment is intact."

Despite the agreement and resulting restoration of funding, the university continues to face severe financial stress due to increasing costs, an expanded workforce, legal expenses, the growth of financial aid, the need to invest in deferred maintenance, and reductions in federal and state funding, he said.

Facing "enormous and unpredictable financial headwinds, with the potential to disrupt every part of our financial model," Kotlikoff said, Cornell must pursue purposeful and thoughtful changes that will prepare it for - and protect it from - future shocks.

He outlined the Resilient Cornell initiative, which is intended to safeguard the university's academic mission and institutional excellence by centralizing functions, identifying more efficient processes and systems, reevaluating budgets, and addressing unsustainable staffing levels through job attrition and layoffs.

"There is no way to make this easy, but we're doing our best to minimize layoffs and support our staff, and get to the place we need to be in the most humane way possible," he said.

That support includes a new Talent Transition Service for any staff impacted by layoffs, as well as a new internal career hub that will help connect Cornell community members with job openings across the university.

Another challenge, one that is not limited to universities, is rising health care costs, which have resulted in an increase in Cornell's employee contribution rates - "a big hit to many paychecks," Kotlikoff said.

Kotlikoff explained that Cornell has historically covered 90% of the cost of individual plans and 75% of the cost of plans covering dependents, but those percentages have gradually increased over time. As of last year, Cornell covered 93% and 81%, respectively, of plan costs, even as the overall cost of health care sharply increased. Beginning this month, the university will allocate an additional $17 million to employee health care, for a total of $149 million; these contributions will cover 91% and 77.5%, respectively, of the cost of individual and family plans, he said.

"I know that costs are increasing rapidly in our region, and that with rising health care costs and constrained salary increases, people feel that they are losing ground," he said. "I can only say that Cornell leadership is working as hard as we can to create the best working conditions and the most stable future for Cornell that we can."

Kotlikoff did have some good news to share: The university will continue its Salary Improvement Program (SIP) in 2026, with employees seeing increases in their base pay, as well as performance rewards.

"I've been asked by some why we're having a SIP given the financial situation - why are we having a SIP while we're also laying off some employees. The answer is that both are necessary for our long-term goal of a sustainable financial model that supports Cornell's excellence," he said. "Competitive and equitable pay that attracts, recognizes and rewards outstanding employees is an essential part of our core mission, and that is not something that is going to go away in our work toward a more resilient Cornell."

The event also featured a Q&A with the audience in which Kotlikoff and Interim Vice President and Chief Human Resources Officer Sean Moeller further discussed the potential impact of Resilient Cornell on university employees and the work they do, professional development, student experience and academic offerings.

"Let me just finally say that one of the things that I think is Cornell's secret sauce is the strength of our community and our ability to work together to achieve great things and overcome great challenges," Kotlikoff said at the conclusion of his remarks. "So I appreciate, so much, everyone's help in everything that we're doing."