Editor’s note: The original version of this story has been revised to reflect corrections.
Despite many holding out hope, students were informed by email Oct. 8 that the spring 2021 semester would be conducted online. The official announcement was something Jeff Hamrick, vice provost for institutional budget, planning, and analytics, had been waiting for.
“To my mind, it was only a matter of thinking about the timing of the announcement and the president firming up his own mind about that decision,” he said. So what exactly does this decision mean for the University’s finances?
For every fiscal year, Hamrick’s office builds a budget primarily based on the number of continuing and incoming students. Usually, there are only small variances between those budget targets and their actual costs. However, Hamrick said the fall 2020 semester is the first systematic and structural shortfall in undergraduate enrollment of this magnitude that he has experienced since stepping into his role.
“Imagine you’re planning a personal household budget around a $35,000 income, and you can plan for $35,000 of expenses, and then something happens to you or your job. Only $20,000 of income comes in. You’ve got to make some choices about cutting expenses to keep everything in balance,” Hamrick said. “That’s basically the situation that the University is in. And not just us, but most, if not every, university in the United States right now,” said Hamrick. According to a message from their president, Santa Clara University, a fellow Jesuit university in the Bay Area, is dealing with a hefty revenue loss of around $35 – $45 million.
Next semester, the University must contend with the possibility that enrollment deferral numbers will increase (more than 200 students deferred the fall 2020 semester) and that tuition payments expected of these students will not be made. “There may be some students who are very unhappy right now with the way their online classes went this fall,” Hamrick said.
Sevag Halajian, a junior economics major, is one of these students. Halajian expressed that he was unhappy with online learning and said, “From a purely psychological standpoint, when I see someone in real life, it feels like there’s more incentive to make a connection, to be present. The screen can be kind of isolating sometimes. At least, I think it takes a lot of effort for me to really see it as something that is equivalent to in-person [learning].” Halajian said he is considering deferring enrollment at USF this spring in favor of pursuing a full-time job to boost his resume until classes return to in-person modality.
The spring online decision also means another semester of residence halls operating at near-empty capacity, which has already financially burdened the University due to room and board fees that account for a large portion of USF’s annual revenue. According to Hamrick, USF is facing “about a $60 million impact on our revenue outcome for the current fiscal year“ due to residence halls operating at about 10% capacity.
In response to the changing financial situation, USF has been making changes to what resources are being used and which are not. Utility, natural gas, and custodial budgets were among those that were cut as a result of scaled back foot traffic on campus, said Hamrick. Many buildings have had their restrooms shut down, and some are being completely powered down. One such building is Kalmanovitz Hall, whose shutdown has been a point of contention among faculty and administration, as it is home to most full-time professors’ offices.
“I have been told that the university is saving a half a million dollars a month from shutting buildings down. If these savings allow some people to keep their job, I absolutely endorse them,” said Keally McBride, vice president of the full-time faculty union, in an email. “I know faculty have been struggling to balance life and work obligations–just as everyone else during this pandemic–so I hope that they might figure out some creative ways to provide more spaces for working, or open the buildings up for one week a month in order to provide more support for faculty who need it.”
While maintenance costs have decreased, the utilization of information technology resources has gone up significantly. Professors are not the only USF employees who have transitioned to an online format. Employees in Students Disability Services (SDS), Counselling and Psychological Services (CAPS), and career services, among many other offices, have also made the change. As a result, the University has not realized significant savings through these offices because they are still being used, but they have realized savings through other means. For example, the School of Nursing and Health Professions returned about $200,000 intended to fill vacant faculty positions because it felt that it did not need to hire anyone new during the pandemic.
Additionally, USF has cut down its recruiting costs. The University normally sends admissions counselors around the country to visit high schools and community colleges to recruit the newest class of Dons — given the coronavirus pandemic, they are not able to do these visits.
“In a normal year, we would’ve been traveling from state to state, hitting three to five high schools a day, and then a college fair at night. But now with everything being virtual, we can’t even hit as many schools and events as we want because most schools are still trying to figure out how to teach their students and still be safe while doing it,” admissions counselor Justin Nkemere said in a written statement to the Foghorn.
All of the money associated with those travel budgets was eliminated by Strategic Enrollment Management as part of its “savings identification process.” However, the school did not eliminate its digital marketing recruitment budgets.
Faculty and staff have taken on a significant role in lessening USF’s financial load for this and next semester. “Our faculty were due for a 4% pay increase plus what we call a step increase [periodic pay raise]. And they gave those up as part of helping the university balance its budget in light of the tremendous revenue shortfall,” Hamrick said.
According to McBride, the decision to take a pay cut, and the negotiations with the University surrounding it, were far from easy. In May, USF administration informed the full-time faculty union that they were considering laying off all tenure-track faculty. “This was incredibly shocking and upsetting to all concerned, as these professors are many of our most dynamic and talented faculty,” said McBride. “This threat had the intended effect-we returned to the bargaining table with the support of our membership to prevent the loss of our junior colleagues.”
McBride said the full-time faculty union felt “boxed in” by this threat, which led to negotiations that were “personally, extremely exhausting and demoralizing.” The negotiations culminated in the union agreeing to shoulder 36% of the University’s budget shortfall, which manifested in salary cuts as high as 10% for senior faculty.
Those who make less than $70,000, however, did not receive any cuts. “Adjuncts are [not paid above] that rate, you know, we’re part time faculty. So I feel like they [USFFA] were looking out for us and some of their people that are lower on the scale as well,” said Jill Schepmann, president of the USF Part-Time Faculty Association. According to Schepmann, most adjunct faculty at USF are paid between $20,000 and $40,000.
In addition, many members of the administration and President Paul Fitzgerald’s cabinet, such as Hamrick himself, experienced a 15% salary cut. Hamrick said that the University had to make the tough decision of getting some people to retire and laying others off as part of “leaning the university out, rightsizing it a bit to match the current revenue circumstances that we face.”
Despite these financial cuts, Hamrick said he believes human capital is still the most important resource the University has. “If you lay off those folks and they go away and they go off and do other things, you lose all that knowledge,” Hamrick said. “The knowledge and expertise, and the way that our employees understand our mission, vision and values is in and of itself an important asset that you don’t just want to throw away, even though you’re experiencing a $60 million revenue shortfall.”
Julian E.J. Sorapuru contributed to the reporting of this story.