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Public universities here estimate $224 million in losses so far

Wednesday, Apr 8, 2020

* Press release…

Presidents of Illinois’ public universities sent the following letter to the state’s congressional delegation Tuesday, seeking additional relief from increasing costs associated with the COVID-19 pandemic.

Dear Senator/Representative:

We write on behalf of Illinois’ public universities to ask for your continued support—and additional federal resources—as we respond to the COVID-19 pandemic.

With over 180,000 students, more than 48,000 employees and a collective economic impact of greater than $21 billion, our institutions have a crucial role to play in helping Illinois manage and recover from this grave challenge. Over the past several weeks, we have taken unprecedented steps to safeguard the health, well-being and education of our students while maintaining our commitments to our employees and to the communities we serve. These measures have taken a significant financial toll, including:

    Refunds for room and board;
    Costs of transitioning to online education and telework;
    Expenses associated with mitigating and remediating the impact of COVID-19, including assisting relief and response efforts, cleaning our campuses, and safely ramping down research activities;
    Lost revenues from cancelled programs and events, closed facilities and delayed grants.

We are grateful for the support Congress has provided to date, particularly the assistance for students, institutions and student loan borrowers included in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted March 27. As Congress crafts further legislation responding to the crisis, however, additional relief is urgently needed.

In particular, while the CARES Act included roughly $14 billion for grants directly to institutions of higher education nationwide, that is roughly a quarter of the funding that the higher education community had requested. Collectively, our institutions stand to receive approximately $140 million in direct grants under the CARES Act, at least half of which will be passed on to students for emergency financial aid grants. These institutional funds are welcome, but they do not cover the expenses and revenue losses we have incurred to date, which we estimate at approximately $224 million, let alone the additional costs and losses we expect in the coming weeks and months. Accordingly, we support the request made by the Association of Public and Land-grant Universities that Congress provide an additional $47 billion in emergency funding for students and institutions of higher education.

We also ask that Congress provide public institutions with the same assistance that private employers are receiving to pay for the expanded employee paid sick leave and Family and Medical Leave Act (FMLA) benefits included in the Families First Coronavirus Response Act (FFCRA), enacted March 18. We estimate that our universities will expend approximately $195 million to comply with these new requirements. While private employers will receive refundable tax credits to offset the costs of these benefits, FFCRA excluded public employers from eligibility.

We thank you for all that you are doing during this challenging time, and appreciate you considering this urgent request for assistance.

- Posted by Rich Miller        

20 Comments
  1. - City Zen - Wednesday, Apr 8, 20 @ 11:21 am:

    Universities should consider liquidating any unrestricted endowments.


  2. - Jocko - Wednesday, Apr 8, 20 @ 11:28 am:

    Like CZ is saying, I have a hard time believing that the profit margins of UIUC (and others) are so tight that they had to furlough the majority of their minimum wage employees.


  3. - ArchPundit - Wednesday, Apr 8, 20 @ 11:32 am:

    I would expect the biggest impact to be on private colleges and universities. There are a lot of them in very marginal financial position and this is going to hit them hard and lead to a lot of closings.

    For publics, it’s going to be tough, but they may have an easier time recruiting if we have a recession that lasts past the fall (the fall semester is going to be a mess everywhere)


  4. - Big Jer - Wednesday, Apr 8, 20 @ 11:34 am:

    It is an absurd time when I agree with anything City Zen says but he is right.

    Not just liquidating unrestricted endowments but if the universities want financial help then require complete transparency of each universities financials.

    While it may be a “public university” I have have a hard time believing the University of Illinois is not lacking in financial resources. The smaller universities like Eastern, Northern, etc. probably need help but even then they need to be financially transparent.

    Unfortunately like many businesses etc in COVD-19 crisis the universities on the edge like Western and Southern-Edwardsville will probably not survive


  5. - illdoc - Wednesday, Apr 8, 20 @ 11:42 am:

    SIUE has grown to pass SIUC in total enrollment


  6. - 47th Ward - Wednesday, Apr 8, 20 @ 11:46 am:

    Agreed Archpundit. A lot of the privates are almost completely tuition dependent so if enrollments collapse, that’ll be the ball game for many.

    OTOH, the publics are likely to feel the squeeze next fiscal year and beyond as the state’s revenue craters and the budget ends up with a multi-billion hole in it.

    In either case, this is a major disruption event for all of higher education. We’re going to find out if on-line education is for real because the market is going to grow. Some will take advantage, like Arizona State and Georgia Tech. The colleges (and really it’s the faculty) who haven’t embraced on-line teaching and learning, are going to be dinosaurs.


  7. - Scamp640 - Wednesday, Apr 8, 20 @ 11:47 am:

    @ Big Jer. I am not sure you know what you are talking about. WIU will survive. SIUE has reached SIUC in student enrollment. Sheesh.

    A couple of people here are talking about public university budget transparency. University budgets are public record. Google is your friend if you think public universities in this state are somehow “hiding” money.


  8. - up2now - Wednesday, Apr 8, 20 @ 12:06 pm:

    The universities haven’t caught many breaks the past 10 years or so.


  9. - ArchPundit - Wednesday, Apr 8, 20 @ 12:11 pm:

    ===The colleges (and really it’s the faculty) who haven’t embraced on-line teaching and learning, are going to be dinosaurs.

    I wouldn’t take this too far. Many students need in person to focus. Online can be great in an emergency and for those who are self-motivated and have a strong understanding of how to learn. Face-to-Face is still a benefit to students who need to the discipline and in person guidance. I think we’ll see some further expansion, but there is a limit on it.


  10. - 47th Ward - Wednesday, Apr 8, 20 @ 12:30 pm:

    ===but there is a limit on it===

    Agreed 100%. Many students prefer face to face, and it’s pretty evident that the learning is much better in small classroom settings.

    But this temporary need to provide remote learning is going to further refine it for many, and some students will find they prefer it to moving away from home for four years.


  11. - Jimmy baseball - Wednesday, Apr 8, 20 @ 12:41 pm:

    == Universities should consider liquidating any unrestricted endowments.==

    With respect, how do you think they got through the budget impasse? Not a lot of meat left on those bones.


  12. - Generic Drone - Wednesday, Apr 8, 20 @ 12:42 pm:

    McMurray in Jacksonville has closed. Don’t think the Corona virus had much to do with it, but didn’t help.


  13. - Because I said so.... - Wednesday, Apr 8, 20 @ 12:56 pm:

    Most if not all the regional universities had not fully recovered from the budget impasse. Remember, one of those years they got a 70% cut in appropriations. And most endowments are set funds set aside for specific scholarships. You can’t get access that money when you need it for something else.


  14. - Big Jer - Wednesday, Apr 8, 20 @ 1:13 pm:

    illdoc and Scamp:

    It is rare that I comment on Capitol Fax without data or evidence so admittedly my comment may not have been fact based or accurate in the details. However, I still stand by the message that “some: public and private universities are well prepared to deal with the crisis.

    Many people have criticized higher education, public and private for their administrative bloat, expansion, etc.

    One example is Roosevelt University in Chicago which from what I have read has been completely mismanaged since went there for graduate studies in 2006. They built a state of the art high rise dorm in downtown Chicago but a few years late cut many programs at it’s Schaumburg campus. Meanwhile the presidents of RU get paid like CEO’s.

    https://www.chicagotribune.com/investigations/ct-roosevelt-university-finances-met-20151008-story.html

    I also do not believe that public universities are “hiding money” but some are better off than others. That being said, like some private colleges, due to underfunding of public higher ed many public universities are essentially private as they are largely tuition dependent.

    Scamp: my poor examples of WIU and SIEU aside, I feel I do know what I am talking about as I have been connected to academia for many of my 61 years.


  15. - ArchPundit - Wednesday, Apr 8, 20 @ 1:14 pm:

    ===Some students will find they prefer it to moving away from home for four years.

    We agree. I do have one worry and that is if some of the online during this period is a bad experience it might scare some off, but given the situation there’s only so much anyone can do.


  16. - Big Jer - Wednesday, Apr 8, 20 @ 2:50 pm:

    Addendum:

    I am amending my earlier comments slightly in that the impacts of the budget impasse on the universities slipped my mind. As commenters have pointed out some of the universities endowments got eaten up during the impasse and have less to deal with in a crisis.

    But many authors have written articles and books criticizing higher ed for administrative bloat, expensive expansion, luxurious amenities, turning many professors into adjuncts/temps. I am just urging caution when we give money to any entity, public or private, that there is some accountability and transparency.


  17. - Farmer Boys - Wednesday, Apr 8, 20 @ 3:53 pm:

    Sell all university owned farms more than 30 miles from C-U.


  18. - Rich Miller - Wednesday, Apr 8, 20 @ 4:17 pm:

    ===Sell all university owned farms===

    Everyone has their own priorities.


  19. - filmmaker prof - Wednesday, Apr 8, 20 @ 4:20 pm:

    47th - The colleges (and really it’s the faculty) who haven’t embraced on-line teaching and learning, are going to be dinosaurs.

    Really? Name them please. Give me the names of the faculty who are not currently embracing on line teaching. I’ll wait.


  20. - 47th Ward - Wednesday, Apr 8, 20 @ 4:52 pm:

    Whoa, try some decaf professor.

    Over the past decade and a half that I’ve worked in higher ed (staff, not faculty, but you probably guessed that), I’ve heard dozens of reasons why on-line learning wasn’t good enough, didn’t save money, didn’t make college more affordable, wasn’t worth trying as an enterprise.

    Most adjuncts and term faculty embrace it, and some schools do a really good job. I mentioned two up above. But in my experience, many tenured faculty have been reluctant to get on board or take the technology training they need to be effective on-line instructors. That’s their choice, certainly, but my guess is that will make them obsolete in the near term future.

    And seriously, asking for a list of names? That’s your response to the point I was making?


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