In last week’s Clif’s Notes, I discussed the $7.6 million withhold from our state appropriation that was announced earlier this month.
This withhold is only one of the revenue losses we anticipate in fiscal year 2020, which ends June 30.
Examples of other unbudgeted revenue reductions and expenditures include:
- More than $3.5 million in housing credits
- More than $1 million in meal plan credits
- More than $1 million as a result of contract revisions
- More than $1 million in other credits (study away and immersion programs, band and Chorale trips, tickets for shows and events, etc.)
- More than $900,000 in reduced tuition and fee revenue for the summer term (more on this below)
- Expenses to facilitate work-from-home, remote delivery of classes and disinfecting of campus spaces
- Expenses to enhance services, supplies and equipment at Magers Health and Wellness Center and our other campus clinics
As the coronavirus pandemic continues, we are presented with a litany of additional revenue reductions, expenditures, and short and delayed payments on amounts owed to the university.
These revenue reductions and expenditures create a substantial FY2020 budget gap.
Managing revenue losses
Last week I shared with you several steps we have taken to fill this gap. Here is some additional detail:
- The hiring freeze for open positions will continue through June
- We reduced our engagement of student workers and part-time staff
- We moved 65 full-time staff to 2/3 pay with more likely to follow
- We halted 133 campus facility projects
- We canceled all events and travel through June
- We closed most campus buildings to decrease utility costs
Additionally, I have instructed athletics that they will be responsible for managing their own unbudgeted revenue losses and expense increases. This includes more than $600,000 in reduced payments due to cancellation of the MVC and NCAA basketball tournaments. We will not use university funds to cover the unbudgeted athletics shortfall.
Today I want to let you know about additional actions we are taking to help fill the FY2020 budget shortfall.
We will eliminate online course incentive payments to faculty for the summer term.
By offering only online classes this summer, the university will receive $900,000 less in tuition and fees. While tuition for online courses is higher than in-state tuition for seated courses, the $900,000 shortfall results from not collecting student fees for online classes as well as not collecting the price differential for out-of-state and graduate students.
Eliminating the online course incentive payments for faculty will generate $700,000 in savings, making up the bulk of the summer tuition and fee shortfall. We’ll make a decision regarding restoring the incentive payments in the fall following financial analysis in July when we’ll have a better sense of our financial position.
Additionally, our leadership team (including all vice-presidential level administrators, deans, associate and deputy provosts, as well as the Chancellor of the West Plains campus) will take a voluntary 10% pay reduction, and I will take a 20% pay reduction, for the months of May and June. Thank you all for caring so much about our university.
Coronavirus stimulus funds
Last week the state legislature authorized Governor Parson to distribute federal coronavirus stimulus funds, including a $31 million authorization for Missouri State University. We are grateful for the quick action of Missouri lawmakers.
It is important to note that this does not mean Missouri State University will receive $31 million in federal stimulus funds. We may very well not receive any of these funds.
If we receive any of these funds, they will likely have many strings attached. They may also be combined with offsetting withholds, resulting in flat (or possibly even decreased) funding for Missouri State.
At this time we cannot plan for any of these funds to close the university’s budget gap. We continue to advocate on this and other funding opportunities.
We anticipate additional revenue shortfalls for next fiscal year. Several difficult decisions lie ahead as we establish the FY2021 budget in the coming months.
There is some good news. Last week the U.S. Department of Education issued its first round of guidance on the funding universities will receive under the Coronavirus Aid, Relief and Economic Security (CARES) Act.
Missouri State University is set to receive $13,855,674 for Springfield and $960,166 for West Plains under the CARES Act. Unlike the federal stimulus funds flowing through the state that I referenced above, these funds will flow directly from the federal government to the university.
There are stringent restrictions regarding the use of these funds (e.g., at least 50% must be used to provide students with emergency financial aid, etc.). While we will work to utilize these funds as much as possible to fill the void of unbudgeted expenditures and revenue losses due to the coronavirus, these federal funds are not a dollar-for-dollar substitute for losses to the university’s general operating revenue.
We are grateful to Sen. Roy Blunt, Sen. Josh Hawley, Rep. Billy Long, Rep. Jason Smith and all of our federal lawmakers for supporting this important legislation. It will have an impact on the university’s ability to respond to the coronavirus pandemic and on our students’ ability to recover from the academic and financial disruption.
Thanks for all you do for Missouri State!
- Clif’s Notes for Sept. 29, 2020 - September 29, 2020
- Clif’s Notes for Sept. 22, 2020 - September 22, 2020
- Clif’s Notes for Sept. 15, 2020 - September 15, 2020
- Clif’s Notes for Sept. 8, 2020 - September 8, 2020
- Clif’s Notes for Sept. 1, 2020 - September 1, 2020
- Clif’s Notes for Aug. 25, 2020 - August 25, 2020
- Clif’s Notes for Aug. 18, 2020 - August 18, 2020
- Clif’s Notes for Aug. 11, 2020 - August 11, 2020
- Clif’s Notes for Aug. 4, 2020 - August 4, 2020
- Clif’s Notes for July 28, 2020 - July 28, 2020