Colleges and universities face budget shortfalls amid coronavirus

Like so many colleges and universities, schools like William Paterson University have refunded room and board and meal plan payments to students for the spring semester. It’s left massive holes in their budgets.

“The cost to the university right now, right now this semester is about $12 million,” said the president of William Paterson University, Richard Helldobler.

State aid has been frozen, as Rowan University’s President Dr. Ali Houshmand explains.

“The last four months of the fiscal year they cut our application by 50% and this could be continuing in the following fiscal year,” Houshmand said.

For Rowan University, the losses total about 6% of its already-slim margin operating budget.

“So far $33 million for this fiscal year, the two and a half, three months left from this one. Next year, God help us. I have no idea. It could be monumental,” Houshmand said.

Monmouth University is a private school in West Long Branch. The school has been forced to freeze all hiring and announced executive staff voluntary salary cuts — the president by 25% and the 18 cabinet members by 10% .

All options for the future are on the table. In a letter to its faculty, President Patrick Leahy said: “We have no choice but to create room in our operating budget this year both to cover lost revenue and to fund the unforeseen expenses associated with the rapid transition to remote instruction and learning.”

William Paterson’s Helldobler says it’s too early for those discussions, but he’s guaranteed no furloughs through the end of this fiscal year.

“I think especially during the pandemic, when lots of families have lost their jobs, as long as the university can remain fiscally viable, we’ll try to avoid those at all costs. I mean, the heart of your institution is your people,” he said.

Houshmand is considering salary cuts first, and has already suspended raises for the administration.

“I’d much rather if nobody loses their job and everybody shares the burden so that we can come through,” Houshmand said.

But federal aid like the CARES Act and GEAR grant could supplement some of the losses. CARES funds have come in, but schools need guidance from the U.S. Department of Education on how to distribute it to students.

“William Paterson received about $10 million. About 6 of that will go directly to students,” Helldobler said. “We’re hoping that as federal money in through the GEAR grant that we spoke about earlier, that the state will either give us money from the GEAR grant, or unfreeze some of the appropriation that the university is due.”

With the state budget deadline pushed back to September 30, New Jersey’s schools still have a ways to go before they understand what state funding will look like next year.