Published in Talent

Higher ed leaders plan for fall, respond to budget setbacks

BY Sunday, May 24, 2020 06:20pm

Leaders at public universities, community colleges and private schools across Michigan are getting a clearer picture of their budget shortfalls resulting from COVID-19, but uncertainty still clouds enrollment prospects and future in-person learning.

The pandemic — and resulting stoppage of on-campus living, learning and public events — has resulted in hundreds of millions of dollars in lost revenue for higher education. Some were harmed more than others, such as Western Michigan University, which has already made significant layoffs and budget cuts to offset the losses. Schools also received millions of dollars in federal CARES Act stimulus funds last month, at least half of which is reimbursed to students.

But at this point, school leaders are running through multiple scenarios for spending and teaching students.

“We are planning to offer face-to-face enrollment in the fall and to meet any and all conditions around public health and well-being,” Grand Valley State University President Philomena Mantella told MiBiz. “I say that, but I don’t know 100 percent what those specific conditions are.”

She added that GVSU is planning “multi-modality enrollment” that may include a mix of online and in-person learning. Most of GVSU’s student housing is private suite-style apartments, while empty event space could be used for classes. Earlier this month, a group of “health technical advisers” including local health experts, hospitals and public safety officials were meeting several times a week. 

Central Michigan University also used an emergency management team to focus on public health and safety while making sure students “progress along their academic goals,” said President Robert Davies. 

The school is planning for four to five different scenarios for the fall semester that include a mix of in-person and online classes.

“What will guide us in these efforts is the safety and health of our students and making sure there’s progress toward their academic goals,” he said.

Western Michigan University also is planning to have in-person classes this fall.

“If the government imposes restrictions, we’ll do what’s necessary to safely deliver the curriculum and instruction,” said WMU spokesperson Paula Davis. “It’s hard to predict the future but we want to get back to campus.”

At Davenport University, a private school with 10 campuses across Michigan, administrators are planning for a mix of classroom and online instruction this fall, according to President Richard Pappas.

“We’ll see what happens. We’ll see how the pandemic (goes). September, while it seems like it’s a long way off, is not,” he said.

Davenport will follow U.S. Centers for Disease Control and Prevention social distancing guidelines and require staff and students to wear masks, and will do health screenings and testing such as temperature checks, Pappas said. The university is having its safety plan reviewed by the chief medical officer at Metro Health-University of Michigan Health.

Since the 1990s, Davenport has offered online learning, so faculty was prepared to handle the transition when the pandemic hit Michigan in March. The university, with 6,800 students, transitioned to all online instruction within two days, “and really had almost no interruption,” Pappas said.

Davenport also decided to offer only online instruction for the summer term, Pappas said.

Reimbursing students

Across the state, higher education institutions saw a swift drop in revenue, primarily from funding reimbursed to students for room and board. The shortfalls extend into next year with the unlikelihood of sporting or other public events. Michigan State University will have a roughly $50 million budget shortfall this fiscal year, which could reach $300 million the next fiscal year. The University of Michigan could see losses of up to $1 billion by the end of 2020.

Western Michigan University faces a shortfall of $45 million this year, which could increase up to $85 million over the coming school year. Over the past month, WMU officials have announced more than 200 layoffs, salary reductions for some staff and a 20 percent cut to its Athletic Department budget. The university has frozen fees related to tuition and room and board.

“The university is under financial strain, but we recognize students and families are also under financial strain,” Davis said.

GVSU’s financial outlook is less bleak. The school anticipates a $13 million shortfall during this fiscal year, which can be absorbed by reserves. The school also received $18 million in CARES Act funding. While half of that is required to be returned to students, Mantella said the full amount will be prioritized for students, such as financial aid and internship support.

CMU is facing a budget shortfall of upwards of $25 million, yet it was one of the first public universities in the state to freeze tuition for next year. Last month, the school also announced that it would provide on-campus employment to any first-year student who needs it, deferred payment and flexible plan options, and an increase in need-based scholarships.

Still, Davies said further budget losses, including from lower state appropriations, require a “lot of future prognosticating. We’re planning for nine to 10 different scenarios of operations and budget implications.”

Enrollment future

The pandemic struck as enrollment was declining at most Michigan public universities, and leaders say it’s too soon to tell whether fall semester uncertainty will lead to an “off year” or students starting their education at community colleges.

Davies said CMU will have a clearer enrollment outlook for the fall over the next month. Over the past decade, CMU’s enrollment declined by about 9,000 students, or roughly 31 percent. From 2018-19, enrollment declined at Michigan public universities by nearly 6,500, one-third of which took place at CMU.

Since CMU’s announcement of scholarships, student jobs and freezing tuition, “our number of deposits and reservations for orientation have started an uptick,” he said. “Will it replace a number of students who just decide not to go? That’s a whole different discussion.”

At Western, enrollment is down nearly 25 percent over the past 15 years, with year-over-year declines for the past decade.

GVSU’s Mantella says school leaders will need to be intentional about the type of programming they provide while ensuring student safety for families.

“I think there’s going to be some shift and some very significant impacts in college enrollment,” Mantella said. “There will be institutions that struggle with this transition, and we’ll struggle with the disruption. But I think we’ll come out stronger in the end.” 

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